FORT WORTH — BAE Systems will lay off the bulk of its employees at Alliance Airport in north Fort Worth after South Korea decided to cancel a contract with BAE to upgrade more than 130 F-16 fighter jets.
About 190 workers received layoff notices today, said BAE spokesman Neil Franz. The company said it would offer severance packages to eligible employees who are regularly scheduled to work more than 20 hours a week.The British defense manufacturer, which is also a supplier to Lockheed Martin on the F-35 fighter jet program, beat out Lockheed for the South Korean contract in 2012 and won U.S. government approval last year. The company then set up shop at Alliance Airport in north Fort Worth, in space formerly occupied by Bell Helicopter, and hired about 200 workers to handle the development work.In a statement, BAE Systems said it was disappointed by South Korea’s decision and said it was confident “that we could have performed the remaining work on the program in an efficient and cost-effective manner.”“BAE Systems was selected by the Republic of Korea in 2012 after a full and open competition, where our solution was deemed the best, most flexible and cost-effective to meet the Republic of Korea's F-16 upgrade needs,” BAE said in its statement.“We made it clear throughout the government-to-government discussions that we were committed to our firm-fixed-price contract for the overall scope of work agreed upon by both the U.S. Government and Republic of Korea last year,” the company said. “Unfortunately, the program was impacted by Korea’s strict budget limitations and the U.S. Air Force's conservative approach to the overall program cost.”According to Reuters, which first reported the decision, South Korea decided to back out after the U.S. government indicated that the cost of the program, handled as a handled as a government-to-government foreign arms sale, would increase from about $1.7 billion to between $2.1 billion and $2.4 billion.Pentagon spokesman Lt. Col. Joseph Sowers said that it became clear that the cost of the contract would have to increase “as there became greater clarity in scope.”In a statement, Fort Worth-based Lockheed Martin Aeronautics, which built the F-16 and has done upgrade work for other countries, said it “values its relationships with its F-16 customers and stands ready to support their current and future needs.”Have more to add? News tip? Tell us
