In a major deal that was heavily freighted with international politics, Japan's All Nippon Airways last week ordered six of Lockheed's L-1011 Tri-Stars, which are powered by Britain's Rolls-Royce engines. The $130 million sale was a sorely needed and roughly won victory for Lockheed, which was saved from bankruptcy by a $250 million federal loan guarantee 14 months ago and is counting considerably on the TriStar for its future. The plane nosed out McDonnell Douglas's DC-10 and a short-range version of Boeing's 747 for the All Nippon airbus business. Beyond the prospect of additional sales of the 300-passenger planes to All Nippon, a big domestic carrier, the deal gives Lockheed its first firm commercial foothold in the Asian market. Says Lockheed President Carl Kotchian, who has been camping in Tokyo for four months: "We won this contract against great initial odds."
Japanese officials are sure that All Nippon's choice will be gratefully received by the U.S. and British governments. At the Hawaii summit in August, President Nixon prodded Prime Minister Kakuei Tanaka to have Japan buy more American goods, including aircraft, to help reduce the U.S. trade deficit. Half a dozen of Japan's newspapers, including Tokyo's large Yomiuri Shimbun, carried reports that Nixon feels a special responsibility to keep Lockheed viable, and that he put in a good word with Tanaka specifically for TriStar. In September Britain's Prime Minister Edward Heath, also worried about trade deficits, urged Japanese officials in face-to-face meetings in Tokyo to have Japan buy aircraft equipped with Rolls-Royce engines. The Japanese took these proddings most seriously, and the only way that they could satisfy both Nixon and Heath was to have a Japanese airline buy the TriStar.
Old Wish. To accomplish that, according to reports in the Japanese press, Tanaka would offer to grant All Nippon one of its long-cherished wishes: overseas routes within Asia. Officials of major Japanese trading houses, who represented the three competing U.S. companies in the negotiations, say that Lockheed was definitely given special consideration by the Japanese. Of All Nippon's decision to buy TriStar, Toru Fukinishi, deputy general manager of the country's international carrier, Japan Air Lines, said: "I was somewhat amazed at this choice." JAL itself last week bought four short-range versions of Boeing's 747.
Though All Nippon and Lockheed vigorously deny that any political pressure was applied, the deal was indeed remarkable. All Nippon's officials say that the key factor in ordering the TriStar was the relative quiet of its engines; yet in noise tests in Osaka and Tokyo, the L-1011 did no better than the McDonnell Douglas DC-10. Moreover, an industry-wide comparison study in the U.S. shows that TriStar's Rolls-Royce engines have had to be removed for maintenance at a rate about three times that of the DC-10's General Electric engines. Early comparison tests also show that the TriStar's Rolls-Royce power plants gulp much more fuel than the DC-10's GE engines, though steps are being taken to correct that problem, at least partially.