BETHESDA, MD, February 7th, 1998 -- Vance Coffman, vice chairman and chief executive officer of Lockheed Martin, today urged U.S. and European allies to pool research and development and production efforts to provide military forces the technology they will need in the 21st century. Pointing to the limited defense expenditures projected over the next two decades, combined with the growing cost of state-of-the-art technology, Coffman said that it will be increasingly difficult for any single nation or company to find the investment funds in all the technology areas needed to field the sophisticated weapons of the next century.

In a speech delivered to the 1998 Wehrkunde Conference in Munich, Coffman called for mutually beneficial transatlantic cooperation and partnerships between U.S. and European defense contractors. "The challenge for business and government," he said, "will be to foster both competition and cooperation across the Atlantic in a way that binds Europe and America closer together." Coffman cited new models of highly successful transatlantic cooperation and partnership, including Lockheed Martin's teaming with British Aerospace in the Joint Strike Fighter competition, its partnership with Alenia to develop the C-27J transport aircraft, and TRACER, an armored vehicle being jointly developed for the United Kingdom and the U.S.

The goal of Coffman's call for cooperation is based on the need to rationalize European defense industry in ways that do not lead to counterproductive competition between European and American industries. "If this perspective results in a 'Fortress Europe' competing against a 'Fortress America,' both our respective companies and our respective countries will be much the poorer. Such an outcome would be both bad business and bad policy," he warned.

He outlined challenges on both sides of the Atlantic. "I do not believe that meeting the challenge is simply and exclusively a matter of European defense companies adjusting to the new reality of a consolidated American defense industry," he stated. "For American political leaders and for the American people, it will require an unprecedented willingness to be dependent on others," he explained. He said that policymakers on both sides of the Atlantic should work to liberalize barriers to build the strongest teams possible for competition in the global marketplace. He further noted:

-- No one member of the Atlantic Alliance has a monopoly on world-class technology, and no one member can shoulder the burdens of maintaining a defense industry capability sufficient to meet all of its security requirements. Alliance nations must cooperate; share; and must find new ways to meet the challenges of a dramatically changed international landscape. -- Cooperative arrangements can and do work within U.S. industry and can work between the U.S. and Europe if the parties come together as business partners focused on making their venture a success without the rancor of politics, or the "who owns who" mentality of ownership dominance.

"Governments need to continue to encourage cooperation through commitments to joint programs and harmonized requirements," he elaborated. "In a similar vein, industry must work to define new patterns of mutually desirable cooperation and partnership. These might include transatlantic, project- specific joint ventures, cross-investments, and Sector-specific strategic alliances and partnerships," he concluded.