Lockheed Since the 1950s

In the mid-1950s, Lockheed Aircraft Corporation, based in southern California, moved firmly into the military aviation sector. Its Skunk Works, the popular name for its advanced projects office, could take credit for most of Lockheed's early military sales. Led by the talented designer Clarence "Kelly" Johnson, the facility designed America's first operational jet fighter, the P-80, that entered service late in World War II. In 1952, the Skunk Works designed the famous reconnaissance plane, the U-2, which debuted in 1955. It presented intelligence analysts with the Central Intelligence Agency and other organizations with critical airborne imagery over the Soviet Union at the height of the Cold War. The U-2 remained the mainstay of airborne reconnaissance through the end of the 20th century.

When a U-2 spy plane was brought down over the Soviet Union on May 1, 1960, the need for a faster and higher-flying plane became obvious. The result was the SR-71 "Blackbird," which evolved from the YF-12 interceptor. The YF-12 itself had evolved from the A-12, which first flew on April 24, 1962, and which was used for CIA flights around the world. The Blackbird first flew on December 22, 1964, and test pilot Robert Gilliland took the aircraft to Mach 1.5. It entered service as the Air Force's first Mach 3 aircraft in January 1966. It was retired in 1990, and then brought back into service briefly in 1995. The Blackbird was the only plane to be the fastest operational aircraft in the world from the day it entered service until the day it was retired.

The Skunk Works also produced the F-104 Starfighter. Accepted by U.S. Air Force in 1958, it was the first and most widely used Mach 2 jet fighter built. Although sales of the plane began slowly and a large number of planes crashed during use, worldwide Starfighter production eventually reached 2,583. Manufacturers in seven countries produced Starfighters, and they equipped at least 15 Air Forces.

With the need for military deployment around the globe as a result of the Cold War, Lockheed began in the latter 1950s to develop a succession of significant military transports. The first of these was the C-130 "Hercules." Lockheed buildt more than 2,000 of the turboprop C-130, in different models, for the U.S. Air Force, and the airplane later found service in a multitude of nations around the world. It gained fame in the siege of Khe Sanh in Vietnam in 1968, resupplying the Marines holding the post against a concentrated onslaught of North Vietnamese. The C-130 remaied in service at the end of the 20th century. In the early 1960s, Lockheed produced the C-141 "Starlifter," the first pure jet cargo aircraft in the military transport fleet. The U.S. Air Force purchased 270 of these aircraft, greatly enhancing its ability to project military force around the world. It has served since 1964 and remains a central aircraft in the military air transport fleet. In the late 1970s, the fleet was modified for in-flight refueling, increasing its operational range, and in the 1980s these aircraft were "stretched" by adding sections to the fuselage for greater cargo capacity.

Lockheed also received a contract in 1965 to build 115 C-5 "Galaxy" jet transports. The plane first flew on June 30, 1968. The largest U.S. Air Force plane to date, its wings spanned 222 feet 9 inches (67.9 meters) and it was 247 feet 10 inches (75.5 meters) long. (A football field is 300 feet [91 meters] long.) But Lockheed had underestimated the aircraft's cost. Delays and cost overruns resulted, and what had begun as a $2 billion project grew to $5 billion. In November 1969, Congress reduced funding to pay for only 81 aircraft.

Although primarily a military planebuilder, Lockheed's chairman and CEO Dan Haughton was anxious to remain in the commercial sector. In 1969, the company decided to develop the three-engine L-1011 TriStar equipped with the high-performance Rolls-Royce RB.211 engine.

This decision led to all sorts of problems. Rolls-Royce itself was having serious financial difficulties and was almost bankrupt. But the British government was not inclined to help and in 1971, Rolls-Royce Aero Engines was placed in receivership. Production of TriStars stopped immediately. Lockheed was depending on TriStar sales, and without government help, would have followed Rolls-Royce into bankruptcy. After much negotiating, Haughton arranged for Congress to guarantee a loan of $250 million to Lockheed, allowing it to go ahead with its project and giving Rolls-Royce the funds it needed.

TriStars were produced until 1983. But the company never recouped its investment, and when production ended, it had lost over $2.5 billion on the aircraft. This was the last commercial airliner that Lockheed built.

In 1976, in the midst of the problems with the TriStar, the company revealed that some $22 million in "sales commissions" had been paid to foreign government officials, including $1 million to Prince Bernhard of the Netherlands and perhaps some amount also to West Germany, in exchange for doing business with Lockheed. In fact, questionable payments by Lockheed to foreign officials may have extended back to the 1950s and factored into the F-104 sale to NATO. Sales of the L-1011 to Japan in 1972 also involved bribery in the amount of some $14 million to Japanese agents and officials.

Arguably some of these payoffs could be termed extortion, where the foreign purchasers demanded payment in order to ensure a sale or prevent its cancellation. Nevertheless, whether Lockheed or the purchaser initiated them, and whether they actually improved Lockheed's financial situation, the "Lockheed Bribes" scandal shook the company to its core and forced several Lockheed executives to resign. The ensuing Senate investigations led to passage of the Foreign Corrupt Practices Act (FCPA), which President Jimmy Carter signed into law on December 19, 1977.

On September 1, 1977, Lockheed Aircraft Corporation became the Lockheed Corporation. At the time, the C-130 Hercules was still one of Lockheed's most successful planes, having first flown in December 1956. Lockheed produced the 1,500^th unit of this large cargo plane in 1978. The 2,000^th was delivered on May 15, 1992, and early in the 21^st century, production still continues.

Lockheed's A-12 and SR-71 of the 1960s had used some low-observable, or stealth, technology, meaning that the aircraft were difficult to detect by radar. In 1976, after Lockheed had developed several prototypes, the Air Force awarded it the contract to develop the first stealth aircraft. Under the guidance of Ben Rich and his Skunk Works team, small test models began flying late in 1977. A full-scale development aircraft, piloted by Hal Farley, flew in June 1981. The aircraft used the radio signal of 117, which led to its designation as the F-117A even though it was solely an attack aircraft and not a fighter. It was also called the Nighthawk because the highly secret plane flew only at night for five years. Not until November 1988 was the F-117's existence revealed. Around the same time, 52 of the aircraft were delivered to the Air Force.

In the mid-1980s, Lockheed, along with aerospace companies Boeing and General Dynamics (GD), won a competition for the Advance Tactical Fighter (ATF), called the YF-22. The team received the development contract in April 1991. Under development as the Raptor, it may be operational by 2004. Lockheed acquired GD's Fort Worth Division in 1992, gaining both GD's share of the F-22 project as well as its highly successful F-16 program.

Meanwhile, on January 1, 1954, Lockheed had established a Missile Systems Division, soon renamed the Lockheed Missile and Space Company (LMSC). Its first project was the X-7 ramjet high-altitude vehicle. Beginning in 1956, Lockheed began producing reconnaissance satellites and other space hardware for the U.S. intelligence community. In 1960, after a string of failures, the Air Force and CIA orbited the first successful reconnaissance satellite, named CORONA. More than 140 versions of this spacecraft flew until 1972. Lockheed went on to build later reconnaissance satellites and the Agena upper stage, which boosted hundreds of military and civilian spacecraft into orbit. From 1959, it also supported the Polaris submarine-launched ballistic missile (SLBM) program and built the solid-fuel Polaris missiles.

Early in NASA's Space Shuttle program, LMSC manufactured the tiles for the Shuttles' thermal protection system. It also beat out Rockwell International, the incumbent contractor, for the contract to manage all ground processing of the Space Shuttle fleet at Kennedy Space Center in Florida. Lockheed also participated in the Air Force activation of Vandenberg Air Force Base for Shuttle operations. The company also developed the Support Systems Module for the Hubble Space Telescope as well as providing support for NASA during operations of the telescope.

In 1995, Lockheed and Martin Marietta, the dominant firm in defense/aerospace electronics, merged, forming Lockheed Martin. The new aerospace giant listed combined revenues of some $23.5 billion, with products ranging from transports and the most advanced combat planes to missiles and rocket launch vehicles, as well as a myriad of electronic systems and services. In 1997, Lockheed-Martin attempted to merge with Northrop Grumman, another aerospace company, but the Federal Government blocked the merger. In October 2001, a Lockheed-led team was chosen to produce the Joint Strike Fighter, a stealthy, supersonic, multi-role fighter designed for use by the U.S. Air Force, Navy, and Marine Corps, as well as the British military. The team plans to fly the first test aircraft in 2005 and deliver the first operational JSF in 2008.

—Judy Rumerman