On Saturday, The Decatur Daily reported that Virginia-based aerospace industry analyst Marco Caceres said ULA’s large scale compared to newer competitors means it will have to cut workers to remain competitive in a tightening fiscal environment. “I think what they’re doing is looking at the future and saying they don’t see too much opportunity for growth and thinking they’ve got to be a little leaner to compete against some of the younger and smaller companies like SpaceX,” he said. “They’re going to have to lay off people.”

One analyst said Northrop would do well to focus on maritime capability. “The US Army likes the STARlite, but it could have a much bigger future if they can go maritime, which is what the US will need more of as it focuses on Asia,” said David Rockwell, an analyst at the Teal Group.

“There’s no economic argument that I can think of for leaving Puget Sound,” said Richard Aboulafia, an aerospace analyst with Teal Group, a Fairfax, Va.-based consultant. The 777X is hugely important to Boeing’s future in the commercial airplane industry, where it faces competition now from Airbus with Russia and China looking to get more market share in the next decade, experts say.

After formally unveiling the plane on the opening day of the Dubai Air Show, Boeing announced airline orders for the 777-8X and 777-9X worth nearly $100 billion at list price. After Boeing’s experience with the 787, which saw three years of delay before the first delivery, the company’s margin of error for delivering the 777X is “between zero and none,” Aboulafia said. Everett and Puget Sound offer the least production risk, noting its trained workforce, developed infrastructure and state support, and none of that is going to change in three months, he said.

These proposed sales, particularly the long-range SLAM-ERs, raised eyebrows in the defense community. If these sales are approved by Congress, it would mark the first time SLAM-ER has been sold to the Gulf region. Analysts point to the rise of Iran, a joint enemy to the US, Israel and countries in the Gulf Cooperation Council, as a key driver that could be changing the long-held policy. “Seeing these [deals] pop up strongly suggests to me there has been a policy change somewhere,” said Steve Zaloga, an analyst with the Virginia-based Teal Group. “Somebody had made a decision that these will be openly offered to Saudi Arabia and the UAE.”

While these cuts to overhead costs are proactive, Marco Caceres, a senior space analyst for aerospace/defense adviser Teal Group, worries that this is not the end of Lockheed’s downsizing. “They are becoming very realistic about their future of space systems,” which is changing because of budget cutbacks, budget stagnation, increased competition from international players and competition from other U.S. commercial companies, Caceres said. “They are being smart. They are moving now as opposed to two to three years from now when it might be too late,” he said. “If they can’t see a significant way to lower their costs, they could be scooted out of the business in the future.”