Rockwell Revamps Defense Electronics Unit for 3rd Time

By DEAN TAKAHASHI

June 8, 1990 12 AM PT

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TIMES STAFF WRITER

ANAHEIM — Rockwell International Corp. said Thursday that it has reorganized its defense electronics operation again in a move aimed at further streamlining the business and boosting weapons sales in the United States and abroad.

The move marks the third time since July that Rockwell has announced a reshuffling of its Anaheim-based Defense Electronics unit, which is headed by John A. McLuckey, group president.

The changes will not result in any layoffs or relocations, and the company will not take a charge against earnings as a result of the restructuring, said Ron Duncan, an executive vice president of the group, which employs 7,000 people in Anaheim.

The reorganization is designed to help the defense electronics group handle several major contract programs the company has won in the past several years more efficiently, Duncan said. For instance, two divisions that make navigation systems for missiles and submarines will be combined into a single division.

The group’s largest programs include contracts for the Hellfire missile, F-111 aircraft avionics gear, a combat system for a Royal Australian Navy submarine program and guidance devices for the MX and Midgetman missiles.

“The new organization will focus our core competencies on the global markets we now serve, as well as emerging business opportunities,” McLuckey said. “This streamlining effectively restructures 17 former business segments into 14 more-focused market thrusts.”

George Podrasky Jr., an analyst with Duff & Phelps Inc. in Chicago, said it was unclear whether the restructuring would leave the company better prepared to deal with the defense downturn. He said Rockwell’s defense unit, which accounted for about $1.7 billion of the corporation’s $12 billion in revenue last year, still has a healthy mix of programs.

“They’ve been disappointed with the profits of the defense electronics area, but I don’t know how this will change things,” he said.

Lawrence M. Harris, an analyst with Bateman Eichler, Hill Richards in Los Angeles, said the restructuring makes sense because the company had several units, such as its missile and submarine navigation businesses, reporting to different groups.

Harris said the defense electronics unit will have about $2 billion in sales under the new organization. He said he expected the group to report flat sales and profits for the next several years.

The company’s defense group has been growing since last July, when the missile systems groups were combined under the Autonetics Electronics Systems unit in Anaheim. In March, the defense electronics group was created by combining the former Autonetics Electronics Systems and Collins Defense Communications businesses.

Last week, the company added Collins Government Avionics Division in Cedar Rapids, Iowa, to the electronics group. The Collins unit makes avionics and radio systems.

RESTRUCTURING AT ROCKWELL

International Defense Electronics

Top Executive: John McLuckey, president

Headquarters: Anaheim

Employees: 26,000

Autonetics Marine & Aircraft Systems

Headquarters: Anaheim

Top Executive: Ken McQuade, vice president and general manager

* Military aircraft avionics and systems

* Shipboard information networking and combat systems

* Antisubmarine warfare systems, including unmanned underwater vehicles

Autonetics Strategic Systems