AVIATION: An Offer of Costly Salvation

Under normal circumstances, the offer that the British government made to Lockheed Aircraft Corp. last week would sound like something to be turned down flat. But the circumstances were very far from normal. As operator of the now nationalized Rolls-Royce Ltd., the government proposed to deliver engines to Lockheed, six to 18 months late, the early models less powerful than Lockheed wanted, at a price perhaps 40% higher than Lockheed had expected to pay. In addition, Lockheed would have to form a production partnership with the British government and share some development costs—which could be quite expensive.

A Price for...

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