No. 19: UTC keeps eye on the ball

The future looks green for United TechnologiesCorp. The company, based in Hartford, Conn.,won several major government contracts in2007 that will keep revenues rolling in foryears.UTC is made up of several brand-name companies,including Sikorsky Aircraft Corp., Prattand Whitney, Hamilton Sundstrand aerospacesystems and UTC Power. The company ranksNo. 19 on this year's Top 100 list with $1.3 billionin 2007 prime contracting revenue and isled by Louis Chenevert, who became chief executiveofficer in April.The most significant win for UTC during thepast year was a five-year contract award toSikorsky in December forthe delivery of 537 H-60HAWK helicopters to theArmy and Navy, withoptions for an additional263 aircraft. The contract isworth between $7.4 billionand $11.6 billion.David Manke, UTC's vicepresident of governmentand international affairs,said the contract is criticalto providing UTC with continuing revenue andthe ability to plan."When you have a nice backlog of work likethat, you can make investments that you mightnot otherwise do if you only had a year-to-yearcontract and didn't know when these thingswere going to stop being made," he said. "Witha nice contract like this, you've got enough runwayto make the big investments and reallybenefit from the learning curve that comes withit."UTC's Hamilton Sundstrand is heavilyinvolved in space systems, including being theprime contractor for NASA's space suit and lifesupport systems. Thecompany works on environmentalcontrols,mechanical systems andthermal control systemsfor international spaceprograms. Another divisionis working on sophisticatedsystems for theHomeland SecurityDepartment, which include chemical and biologicalcountermeasures, such as handheld andfixed facility monitors. Meanwhile, UTC's Prattand Whitney Rocketdyne, the space division ofPratt and Whitney, captured a $1.2 billion contractfrom NASA. It will design, develop andtest a J-2X engine to powerthe upper stages of the AresI and Ares V launch vehicles,which are slated toeventually power mannedflight missions to the moonand Mars.Manke said the contractwas considered significantbecause of the high visibilityof the project and because itwill give the company achance to be on the cutting edge of the latesttechnology. "There's a lot of learning that goeson with a new development contract like this,"he said.Pratt and Whitney also continued the developmentof the F135 engine for the Air Force's F-35 Lightning II aircraft. The service awarded thecompany in September a $69.3 million productioncontract for F-135 power plants. The firstengines are expected to be delivered in 2009.For all its recent success, UTC is keeping aneye on the near future, which Manke said ismarked by customer concerns about fuel supplies,carbon footprints and flat budgets. UTC isresponding by building more efficiency intoconventional engines and ensuring that they arerobust enough to handle more than one type offuel.Pratt and Whitney has developed what'sknown as a Geared Turbofan engine that canprovide a 12 percent improvement in fuel consumption,environmental emissions, enginenoise and operating costs. The engine is initiallybeing marketed to the airline industry but Manke said it is alsoapplicable to Defense Department platformssuch as long-range bombers and unmannedaerial vehicles.Given the tight fiscal environment, UTC istrying to improve efficiency and lower costs,though Manke said that goal is clearly beingchallenged by the fast-rising costs of commodities,including titanium, copper and aluminum,required for aircraft engines."If we can't bring the price down, at least wecan keep it steady, because affordability is goingto be a critical requirement of the governmentcustomer going forward," Manke said.