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Boeing mulls plant shutdown
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October 30, 2001: 6:31 p.m. ET
Lockheed's superior design caused Boeing to lose huge defense contract.
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NEW YORK (CNNmoney) - Boeing Co., which lost what could become the biggest U.S. military contract ever to rival Lockheed Martin Corp., is mulling shutting down a plant in Spokane, Washington.
The plant employs 550 workers who manufacture parts for Boeing's commercial jet business. The Spokane plant was operating close to capacity before the Sept. 11 terrorist attack which caused a sharp slowdown in aircraft demand.
Now Boeing, which also plans to cut 30,000 of 95,000 workers in its Seattle-based commercial jet unit, is considering closing the plant.
The news comes days after the U.S. Department of Defense snubbed Boeing and awarded a multibillion-dollar contract to build its new radar-evading Joint Strike Fighter to Lockheed last week.
Jerry Daniels, Chief Executive of Boeing's military aircraft unit, said on a conference call that the company lost the contract because Lockheed had a superior design. Boeing also has not talked to Pentagon officials about any "workshare" programs with Lockheed, he said.
The Joint Strike Fighter is intended to replace the nation's aging fleet of fighter aircraft including the A-10 and the FA-16. The plane is expected to be the government's primary fighter aircraft beginning in 2008 through 2040.
Shares of Chicago-based Boeing (BA: down $0.72 to $33.03, Research, Estimates) fell more than 2 percent Tuesday while Lockheed Martin (LMT: down $1.00 to $48.00, Research, Estimates) also shed 2 percent.
--Staff and Wires 
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