RAYTHEON AND LOCKHEED MARTIN JOIN FORCES FOR SECOND PHASE OF CEC PROGRAM
ARLINGTON, VA, 05-FEB-03 -- Raytheon Company (NYSE: RTN) and Lockheed Martin (NYSE: LMT) today announced that they have teamed to bid for the U.S. Navy's Cooperative Engagement Capability (CEC) Block 2 program. The Block 2 phase is expected to be worth approximately $1 billion, and when combined with the $2 billion CEC Block 1 effort, the program's end-to-end value is pegged at $3 billion. Competition for Block 2 is slated to begin in the second quarter of this year, with contract award expected in early 2004. CEC is a unique sensor networking system that helps war fighters detect, target and kill fast-moving airborne weapons-such as cruise missiles-with extreme speed and accuracy. Considered an enabler of network-centric warfare, CEC extracts data from sensors, turns the data into meaningful information and imparts knowledge to commanders. Armed with this knowledge, commanders can make faster, more confident weapon-firing decisions.
One of CEC's current partners in naval network-centric warfare operations is the U.S. Navy's Aegis Combat System. CEC gathers data from its platforms and feeds it into the Aegis Weapon System, where combat system operators use the data to engage threats. CEC-Aegis systems aboard the Navy's USS John F. Kennedy and USS Dwight D. Eisenhower battle groups recently supported U.S. military operations in the Middle East.
Raytheon is the design agent and prime contractor for CEC Block 1. Lockheed Martin is the design agent and prime contractor for the Aegis Weapon System, and was recently contracted to integrate the Royal Navy's CEC T23 Frigate program.
For the Block 2 competition, Raytheon will serve as the team's prime contractor and design agent and will have approximately 60 percent of the development and design agent work share. Lockheed Martin will be Raytheon's principal subcontractor, executing approximately 40 percent of the work.
The Navy's Block 2 development program will improve CEC's capabilities by increasing the size of its sensor network, decreasing its cost, adding new categories of users, optimizing bandwidth efficiency and extending CEC to the joint military community. Approximately 155 Block 2 systems will be installed on aircraft carriers, destroyers, E-2C Hawkeye aircraft, amphibious ships and other platforms. CEC's 2018 deployment goal is 256 systems, as compared with the 46 Block 1 systems in service today.
In announcing the CEC Block 2 teaming, Colin Schottlaender, president of Raytheon's Network Centric Systems, and Fred Moosally, president of Lockheed Martin's Naval Electronics and Surveillance Systems division, stressed the benefits that their companies' collaboration could bring to the user community.
Schottlaender said, It's time for us to join forces, collaborate and better serve the interests of the Navy and war fighters who need CEC.
Both leaders noted that the Raytheon/Lockheed Martin CEC Block 2 team is particularly well qualified to deliver the strongest solution.
The team is built on highly complementary capabilities that each company brings to the table, said Moosally. We're joining together to give the Navy the best solution to meet its needs.
Raytheon Company, with 2002 sales of 16.8 billion, is an industry leader in defense, government and commercial electronics, space, information technology, technical services, and business and special mission aircraft. With headquarters in Lexington, Mass., Raytheon employs more than 76,000 people worldwide.