Lockheed Martin Corporation's New Secret Weapon... Isn't a Weapon at All
Lockheed Martin's C-130J Super Hercules is a monster. At 39 feet tall, 113 feet long, and with a 133-foot wingspan, this military transport plane can carry 128 soldiers, 22 tons of cargo, or an entire armored personnel carrier within its capacious hold, and is rugged enough to land them on short, unimproved runways -- then take off again from same. With 1,131 planes in use by 16 nations around the globe, it's hands-down the most popular military transport on the planet.
And now Lockheed Martin is preparing to deploy the C-130J to maintain its dominance in one key segment of the civilian aircraft market as well.
Super Hercules receives honorable discharge to civilian life
Last week, Lockheed announced plans to launch a new commercial aircraft, derived from the uber-successful C-130J. Dubbed the LM-100J, Lockheed says its new civilian variant of the C-130J will be a "civil multi-purpose air freighter capable of rapid and efficient transport of cargo... particularly to austere locations worldwide."
Like the military C-130J, the new LM-100J can take off from and land on "short, unprepared airfields without ground support equipment." Lockheed describes the new plane as ideal for such missions as fighting forest fires, transporting cargo to remote and "austere" locations, and medevac/air ambulance.
Lockheed intends to offer the plane as a modern-day upgrade to its previous civilian plane, the L-100, which was itself based on the original design of the military C-130. More than 100 L-110s were sold over the 28 years the plane was produced. Now, according to Reuters, Lockheed aims to sell at about 75 of the updated LM-100Js -- primarily to mining and oil exploration companies, but also to government agencies and to other commercial customers as well.
Lacking some of the high-tech avionics and communications equipment installed on its military variant, Lockheed expects to sell the civilian LM-100J for a bit less than the C-130J Super Hercules (which retails for about $70 million). The reported asking price for the LM-100J will be "in the mid-$60-million range." Even so, this appears to make the plane close to a $5 billion opportunity for Lockheed -- before factoring in revenues from maintaining, servicing, and (eventually) selling upgrades on the planes.
For Lockheed Martin, which did $45 billion in business last year, that may not sound like much. But you know what they say -- $5 billion here, $5 billion there, and pretty soon, Lockheed Martin will be making some real money.
Oh, and one more thing
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The article Lockheed Martin Corporation's New Secret Weapon... Isn't a Weapon at All originally appeared on Fool.com.Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of Lockheed Martin. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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