Future for Hughes Unit Uncertain : Restructuring: Ground Systems Group’s functions will be absorbed into new operating sectors. Company says no immediate layoffs planned.
FULLERTON — The future of Hughes Aircraft Co.’s Ground Systems Group remained uncertain this week in the wake of the parent company’s announcement Tuesday that it is restructuring itself to emphasize its diversification into commercial markets.
Richard Dore, spokesman for Westchester-based Hughes Aircraft, said Wednesday that no layoffs will result immediately from the management restructuring. But he said the consolidation is aimed at cutting costs in an era of shrinking defense budgets and that further cutbacks in the overall work force remain likely.
“The change is fundamental in that Hughes will go from a company built around product lines to a company built around markets,†Dore said. “I don’t know if there will be any physical movement of people. A lot of detail is being worked out.â€
Ground Systems Group, which employs 7,500 people in Fullerton, will be phased out as a stand-alone organization by the end of 1993, along with Hughes’ six other operating groups, Dore said.
The groups will each be merged into five new operating sectors: Telecommunications and Space, Aerospace and Defense, Systems Integration, General Motors Programs and Commercial-Industrial.
Ground Systems makes a wide variety of military radars, air traffic control systems and conventional weapons. Its programs will become parts of two of the new sectors--Aerospace and Defense, and Systems Integration. Dore said the systems integration sector will manage programs that require complex software systems, such as air traffic control.
W. Scott Walker will remain president of Fullerton-based Ground Systems until 1993, when he will lose that title. He has become assistant to the president of the aerospace and defense sector, however, and will retain that title after Ground Systems is dissolved.
Walker will report to Richard D. Brandes, president of the Aerospace and Defense sector and president of the Hughes Electro-Optical/Data Systems Group.
The restructuring, begun in July, 1991, included the appointment in February of former IBM Vice President C. Michael Armstrong as Hughes chairman.
Hughes now has 63,000 employees and has been eliminating 3,000 to 4,000 jobs per year, Dore said. Ground Systems has shrunk by 50% from about 15,000 in 1985.
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