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Lockheed Martin Study Develops Cost-Cutting Solutions Reducing Assembly Time 90%, Seeker Cost 22% on Implementation for LAM Production

DALLAS, TX, August 11th, 2005 -- Lockheed Martin [NYSE: LMT] has completed two aggressive cost reduction workshops for the Non Line-of-Sight – Launch System (NLOS-LS) Loitering Attack Missile (LAM), resulting in the reduction of the missile assembly time of the current System Design and Development (SDD) baseline configuration from 21.4 hours to 1.6 hours, a reduction of more than 90 percent. Additionally, the LAM’s Laser Radar (LADAR) seeker cost was reduced by 22 percent.

The LAM is among several products awarded in 2003 to NetFires LLC, comprising Lockheed Martin and the Raytheon Company [NYSE: RTN]. Other products under development by the LLC include a Precision Attack Missile (PAM) and an autonomous Container Launch Unit (CLU).

The workshops, held at Lockheed Martin’s Pike County operations facility near Troy, AL, and its LADAR facility in Ocala, FL, were a cooperative effort between Lockheed Martin and its Army customer, and involved elements of Lockheed Martin’s manufacturing, engineering, quality management and production operations.

“This was an excellent cross-functional meeting,” said Chris Farmer, a production engineering representative for the U.S. Army’s NLOS-LS Task Force, who attended the Troy workshop.

“Our goal is to provide a highly effective and affordable weapon system to our Soldiers,” said Rick Edwards, vice president of Tactical Missiles at Lockheed Martin Missiles and Fire Control. “The team’s challenge was to dramatically reduce costs. Working with our customer, we broke old paradigms and applied forward-thinking solutions to address future austere budgets, while still meeting the warfighter’s requirements.”

Plans include establishment of a pilot production line in Troy and Ocala. The SDD effort will include engineering integration, test and limited production. Full-rate production is forecast to continue through 2020, and involve as many as 70 jobs at the Troy facility.

“We are redesigning the missile body so that assembly is quick and easy,” said Glenn Kuller, Netted Fires director at Lockheed Martin Missiles and Fire Control. “We also leveraged advanced prototyping techniques from the Lockheed Martin ‘Skunk Works’ for the Affordability Workshops.”

“We took a very good design, and reviewed it at just the right time,” said Steve Ericson, senior manager from Lockheed Martin Aeronautics ‘Skunk Works’ Advanced Development Program facility in Palmdale, CA. “The LAM’s square airframe allows for flexibility in packaging and has plenty of volume, which makes for easier assembly and integration.”

The LAM is an integral part of the Army’s Future Combat Systems. The LAM and its LADAR seeker have been successfully demonstrated under previous DARPA NetFires and U.S. Air Force’s Low-Cost Autonomous Attack System (LOCAAS) programs, and will be interoperable with the current force as well as the future force.

The NLOS-LS LAM is a ground-launched, canistered tactical missile capable of increasing the warfighter’s area of influence through hunter-killer flight operation, automatic target recognition, and can attack high value targets or report their target locations for attack by other weapons systems.

LAM’s LADAR seeker provides three-dimensional analysis of potential targets. The LAM vehicle is 62 inches long and weighs 117 pounds, and can search a wide area or loiter for 30 minutes at a range of 70 kilometers. Two-way data links on LAM will provide for re-tasking while in-flight and down-linking of images.

Lockheed Martin has had a successful business relationship with the state of Alabama for the past 10 years. As a result of strong state and local partnerships over the years, Lockheed Martin’s Pike County Operations has amassed a string of national, state and industry awards for excellence in production, quality, security, environmental protection and workplace safety. The Troy facility has been honored with Industry Week’s “America’s Best Plants” award, the Defense Investigative Service Cogswell Award, and the 2002 Alabama “Manufacturer of the Year” award.

Additionally, the facility in 2002 received the prestigious Shingo Prize for Excellence in Manufacturing Award, which “recognizes organizations that use world-class manufacturing strategies and practices to achieve world-class results.” Pike County Operations is among a small number of facilities recognized with this award.

Craig Vanbebber, (972) 603-1615

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