Andrew Doyle/MUNICH Graham Warwick/WASHINGTON DC
Northrop Grumman and DaimlerChrysler Aerospace (Dasa) are evaluating a strategic alliance covering niche defence activities.
US company Northrop Grumman says the deal is being considered because an equity merger with EADS (European Aeronautic Defense and Space), of which Dasa will be part, is not currently possible.
Dasa's talks with Northrop mark EADS' first step towards establishing a meaningful presence in the USA, where European rival BAE Systems is expanding rapidly (see related story on P8).
Talks will focus on "business alliances" in surveillance and reconnaissance, with Northrop revealing that the US Department of Defense supports co-operation in these areas because it will help close the "capabilities gap" between the USA and its NATO allies that became evident during the Kosovo campaign.
Northrop chairman Kent Kresa says an alliance will do much to address "the fundamental causes of the capabilities gap" by eliminating duplication, freeing resources and creating inter-operable systems.
He adds that transatlantic equity mergers "are too difficult to achieve, at least in the near term", because of political, management and other factors, and that "teaming arrangements and joint ventures" are instead "where we should focus our effort and energy in the current climate".
The alliance is likely to cover areas where Europe lags, including ground surveillance systems, high altitude, long-endurance unmanned air vehicles (UAVs), maritime UAVs (including real-time signal processing), radar for military transports, naval radar, and wide bandwidth datalinks. An initial decision on the scope of the partnership is due in June.
Northrop will inevitably take the lead. It is partnered with Airbus on the NATO Advanced Radar project - formerly Airborne Ground Surveillance - which will put an updated Joint-STARS into an A321, and has been earmarked by the Pentagon to spearhead efforts to accelerate technology transfer to Europe.
Northrop also has the Global Hawk UAV and E-2C Hawkeye airborne early warning aircraft, and has been chosen to supply the US Navy's next tactical UAV. Dasa's relevant activities are within its defence and civil systems unit, but this is to shed 1,200 jobs, while its Seamos UAV project is faltering after a crash last year.
Dasa says a Northrop deal will be a "sort of litmus test to see if transatlantic co-operation makes sense given the current political and regulatory framework".
Source: Flight International
