Thu, Dec 04, 2008
The Patriot anti-missile system, built by Raytheon Co.'s Integrated Defense Systems division in Tewksbury, Mass., is expected to be a popular item amid increasing worries about possible missile strikes from Iran and North Korea.
the associated press 2006

Business

world tensions' business role

Raytheon expects surge in Patriot defense sales

By Robert Weisman
The Boston Globe
Tucson, Arizona | Published: 01.19.2007
A week after President Bush said the United States would deploy Patriot anti-missile systems to the Middle East as part of its efforts to stabilize the region, Raytheon Co. executives said this week that they're expecting a spike in Patriot sales as world tensions escalate.
Raytheon has been talking to nine foreign customers about upgrading their existing Patriot systems, and it's also in discussions with several potential new customers, including Turkey and South Korea, executives from the Waltham, Mass.-based company said in a briefing.
Countries around the Middle East and the Korean peninsula are especially concerned about guarding against missile strikes from Iran and North Korea.
"There are a couple of regional threats around the world that have certainly been a lot more active in the past six to eight months," said Skip Garrett, vice president of international operations for Raytheon's Integrated Defense Systems division in Tewksbury, Mass.
Raytheon Missile Systems, Southern Arizona's biggest private employer with about 11,000 local workers, produces some missile-defense systems, but the Patriot is handled in Tewksbury.
In his Jan. 10 speech to the nation, Bush said Patriot systems would be sent to U.S. allies in the Middle East as part of his new strategy for Iraq and the wider region. But he didn't specify which countries would receive the Patriots, where they would come from, and whether the Army would buy new batteries to replace those being deployed.
On Wednesday, an Army spokesman said the Patriot batteries that Bush mentioned initially would arrive in Kuwait but would remain under control of U.S. forces.
They will be sent to the region as part of the USS John C. Stennis carrier strike group and the 3rd Battalion, 43rd Air Defense Regiment, deployed to bolster security, the spokesman said. The length of the deployment would be determined by the commander in the theater, and there are no current plans by the Army to buy more Patriots to replenish the U.S. stock, he said.
Garrett and Rick Yuse, Raytheon's vice president for integrated air defense, said renewed interest in the Patriots is more a result of rising global tensions than the increase of 20,000 troops in Iraq.
Many of Raytheon's existing customers — including Germany, Greece, the Netherlands, Spain, Saudi Arabia, Kuwait, Israel, Japan and Taiwan — are considering an upgrade to the Configuration 3 system, they said.
Raytheon is the Patriot system's integrator and also makes radar for the anti-missile system.
The new configuration includes not only upgraded radar and software, but also the improved PAC-3 missile built by Lockheed Martin Corp. to intercept tactical missiles such as the Russian-made Scuds or Iskanders.
So far, only the U.S. Army has fielded the new model, but the Netherlands and Japan have placed orders, and other countries have been weighing upgrades in the aftermath of missile tests by North Korea and Iran in the past year.
"The heightened tensions with North Korea and Iran are certainly drivers for sales of tactical ballistic missile defense systems," said Steven Zaloga, senior analyst for missile systems at Teal Group Corp., an aerospace and defense consulting firm in Fairfax, Va.
Raytheon doesn't break out Patriot revenue in its financial reports, and Garrett and Yuse didn't say Wednesday how much the company was anticipating in increased revenue. Last year Raytheon reported Patriot orders totaling $283.9 million.