With push from Lockheed, Greek aerospace company spreads wings

In an economy noted for its inadequately trained labor force, archaic production techniques, and indifferent attitude to quality, the Hellenic Aerospace Industry (HAI) has come to be seen as something of a miracle.

Operating in a sprawling complex of workshops and hangars near the Tanagra air base, 45 miles north of Athens, Greek HAI technicians overhaul United States Air Force engines, make helicopter fuselages, and train defense personnel from the Gulf.

The company is considered part of Greece's drive into the modern technological era. Its future, however, depends on the uncertain future of Greek-American relations and on the renewal of HAI's contract with Lockheed, the controversial US aerospace giant.

Despite Greek dissatisfaction with the quality of assistance rendered by Lockheed under a 15-year contract, HAI officials admit that if they wish to extend the scope of their aerospace venture they will have little option but to renew their contract with the American company when it reaches the end of its second phase in December next year.

''Although the Americans could have done a better job, we couldn't have done it without them,'' an HAI official said.

The Hellenic Aerospace Industry was set up in the wake of the 1974 Greek-Turkish crisis, when Greek officals were appalled to discover that a large number of Air Force planes were out of the country for servicing. Today the Greek Air Force is HAI's most loyal customer, but aerospace officials were aware that for the industry to be commercially viable, work would also have to be sought abroad.

Originally, HAI intended to devote itself exclusively to maintenance and overhaul. But it decided to turn to manufacturing as well when it became clear that there was insufficient maintenance work in the region.

HAI was legally constituted in March 1976, construction of the complex began in February 1977, and the first aircraft were accepted for overhaul by the end of 1978. The corporation is jointly owned by the Greek state and the Greek Bank of Industrial Investment. With a total investment of around $400 million, it is Greece's largest industrial project.

The company first made its mark in 1980 when it defeated 12 competitors, including Fiat of Italy, Fabrique Nationale Herstal of Belgium, MTU Friederichshafen of West Germany, and the Israel Aircraft Industry to win a three-year contract to overhaul J-79 engines for US Air Force Phantom jets based in Europe.

''That's how we made our name,'' says HAI's public relations manager, Spiros Karayiannis. ''If you can say that you have the US Air Force as a customer and they're satisfied, then anyone will be satisfied.'' The contract, which is worth

Despite national pride in the achievements, officials admit the undertaking could never have gotten off the ground without foreign help. HAI concluded contracts with several foreign companies to provide technical assistance, including General Electric and Westinghouse. But the most controversial aspect of foreign cooperation was the contract with Lockheed Aircraft International, to provide management assistance and to fill the posts of general manager, marketing director, and quality assurance manager.

The contract with Lockheed was originally scheduled to run 15 years, consisting of a three-year initial period and two six-year operating periods. The agreement was signed at the end of 1975.

The first six-year operational period of the contract is due to end in December 1984, but there have been threats from the Greek side to break off the contract unilaterally before then. The Greeks have complained that although Lockheed might have abided by the letter of the agreement, they have not provided either the quality or quantity of assistance the Greek side had expected.

Both Lockheed and American diplomatic officials in Athens refused to comment on the future of the agreement.

It is believed that HAI is prepared to conclude a new contract with Lockheed at the end of next year, but on a basis different from the present one. Officials say HAI would like to see any future agreement concentrating more on technical rather than managerial assistance. The total number of Lockheed staff at HAI is already down to 30, from 140 at the time the agreement was reached. Although Americans still hold the posts of general manager and quality assurance manager, officials say that management is now effectively in Greek hands anyway.

About these ads
Sponsored Content by LockerDome

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...

Save for later

Save
Cancel

Saved ( of items)

This item has been saved to read later from any device.
Access saved items through your user name at the top of the page.

View Saved Items

OK

Failed to save

You reached the limit of 20 saved items.
Please visit following link to manage you saved items.

View Saved Items

OK

Failed to save

You have already saved this item.

View Saved Items

OK