There are a lot of counterfeit products out there — bogus designer clothing, fake auto parts, even phony aircraft components, but a Framingham company thinks it can put the forgers out of business, with a spray of artificial diamond dust.
DUST Identity spun off from the Massachusetts Institute of Technology in 2011, and has received more than $2 million in federal grants through the Defense Advanced Research Projects Agency. In its early days, the company focused on futuristic ideas, like using nanoparticles of synthetic diamond to build chips for quantum computers that haven’t been developed yet, ut now the company wants to use its diamond particles to weed out counterfeit products, which cost the US economy $600 billion a year, according to the FBI.
DUST Identity recently raised $10 million in venture funding, in a round that included venture capital firm Kleiner Perkins and the investment arms of aerospace companies Airbus and Lockheed Martin, companies that are always on the lookout for better ways to identify and track the millions of parts they purchase every year.
DUST Identity’s chief executive and co-founder Ophir Gaathon, said his company is getting inquiries from carmakers, pharmaceutical firms, even food and cosmetics companies.
“We’ve just been overwhelmed with the number of requests,” said Gaathon, “I think we’ve hit a nerve.”
DUST stands for “Diamond Unclonable Security Tag.” The system combines tiny diamond particles with a polymer that bonds the diamonds to the surface of a manufactured object. The system is compatible with a variety of polymer chemicals, so a manufacturer can use whichever chemical works best for its products.
“We see this technology as rather compelling,” said Chris Moran, general manager of Lockheed Martin Ventures. His parent company makes some of the US military’s most important aircraft, including the F-35, F-22 and F-16 fighters, but even for these highly specialized airplanes, he said, “there are potentially lots of counterfeit parts on the market.” So Lockheed Martin has begun testing the DUST Identity system for its most critical “Class I” parts.
Thomas d’Halluin, managing partner of Airbus Ventures, said that Airbus is also trying out the DUST Identity system. “The probability of counterfeit parts is a real threat,” d’Halluin said. “There is no room to negotiate with the safety of our products.”
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Raytheon Technologies Corp. is realizing it doesn’t need all of its 31 million square feet in office space anymore.
Chief executive Greg Hayes, said on an earnings call Tuesday that he envisions “the office of the future” to be a mix between in-person and remote work.
Raytheon had already been aiming to reduce its costs this year by $2 billion and to conserve $4 billion in cash as part of its April merger with United Technologies Corp., and to adjust to the pandemic’s hit on commercial air travel. So far, the company has trimmed its workforce by about 20,000 people.
Now, Raytheon is looking to double down on reducing its office footprint as the ongoing pandemic proves employees can do their jobs from home.
“Our original goal was to reduce and consolidate office space by about 10 percent, or about 3 million square feet,” Hayes said on the call. “I now think we could see upwards of 20 percent to 25 percent reduction in square footage. That’s going to be a huge savings.”
The reduction could amount to about three-and-a-half times the size of the Boston Common, but the local impact is muted because the company has relatively little office space in Massachusetts.
Hayes said it became apparent to him that Raytheon didn’t need all of its physical space as he toured the country, visiting facilities where “literally a handful of folks” were working in-person and the rest were “being efficient working remotely.”
“I think the ability to work remotely with the technology that we have, without losing productivity, is essential in our go-forward plan,” he said. “That’s easy cost savings in my mind."
Raytheon’s stock tumbled after a third-quarter sales decline in the company’s defense divisions exacerbated a deep slump in its commercial aerospace business.
Revenue slipped 2.3 percent in the missile and defense unit and posted a similar drop in the intelligence and space operation, Raytheon said Tuesday. That crimped the divisions' role as counterweights to Raytheon’s commercial jet engines, electronics systems, and spare parts, which have been slammed by the pandemic. The results underscored the uncertain outlook for Raytheon amid an unprecedented collapse in demand for air travel.
Raytheon stock plunged 7 percent to $56.53 at the close of trading Tuesday.
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It's a cutthroat indu$try:
"Coronavirus opens a stark divide in aerospace industry" by Aaron Gregg The Washington Post, November 3, 2020
Third-quarter financial earnings reported in recent weeks reveal a stark economic divide in America’s aerospace industry, an export-rich sector that employs hundreds of thousands of manufacturing workers across all 50 states.
The economic crisis caused by the coronavirus has elevated those who build jets, missiles and other advanced weaponry for the US military and its allies, but companies involved in commercial aircraft production have seen their finances wrecked by a persistent global slowdown in air travel.
Analysts said the divide illustrates how the coronavirus has created unexpected winners and losers throughout the economy.
“Companies that are largely in the defense business are doing just fine ... the impact of COVID-19 on their operations has been minimal,” said Ron Epstein, managing director for aerospace and defense at Bank of America Merrill Lynch Global Research.
Companies that make or contribute to the production of commercial jets have been forced to make tough choices as airline demand for new jets has collapsed. And the workforce has often borne the brunt of it.
Waltham, Mass.-based manufacturer Raytheon Technologies has laid off almost 20,000 people who worked primarily in the company's engine and aircraft parts divisions, executives said. The staff reductions account for about a fifth of the company's commercial workforce, which it only recently obtained through a massive merger with a company previously known as United Technologies.
Collins Aerospace, an aircraft parts manufacturer that Raytheon acquired in the deal, reported a 34 percent drop in sales in the third quarter of 2020 compared to last year. Pratt & Whitney, a Connecticut-based jet engine manufacturer acquired in the same transaction, also lost about a third of its sales.
Raytheon chief executive Greg Hayes told investors the staff reductions were “difficult but necessary,” adding that the company is planning for “a long, slow recovery.”
"The fact is we don't think you're going to see return to normalcy until probably mid-2023 at the earliest," Hayes said.
XXXX
The recovery "is clearly not a V," Hayes said, referring to a quick bounce-back that many had hoped would follow the economic crisis.
Few in the industry have been hit harder than Boeing, the beleaguered Chicago-based jet manufacturer. Boeing entered the crisis in a weak position because its flagship 737 Max jet was grounded due to equipment problems. The Max still has not been cleared to fly.
Boeing has kept its head above water only by loading itself up with debt, and carrying out aggressive restructuring efforts to prepare for years of depressed sales.
Then they are GOING DOWN as American Airlines is expanding pre-flight virus testing to domestic flights!
In early May it raised $25 billion in a corporate bond sale, making its debt comparable to that of some small sovereign nations like New Zealand and Iceland. It started another bond sale Thursday that should free up even more cash.
It has also carried out aggressive staff cuts, redirecting entire product lines to conserve resources.
Boeing announced last Wednesday it will cut its global workforce to 130,000 by the end of 2021; it started 2020 with 160,000. The cutbacks will have a particular effect in Everett, Wash., north of Seattle, which faces steep cutbacks related to production of the 787 Dreamliner. That production line is being consolidated at a nonunion factory in South Carolina.
Companies that get a majority of their revenue from government contracts ― General Dynamics, Lockheed Martin, and Northrop Grumman in particular ― are doing well by comparison.
“At least COVID-wise, the defense industrial base has been somewhat of a haven from the storms that are buffeting the economy,” said Wes Hallman, vice president at the National Defense Industrial Association.
All you got was $600 of your own money, taxpayer.
Despite the operational disruption the pandemic caused to their government customers, those companies benefited from an early declaration that businesses involved in national security should be declared essential. They were also helped by improved financing terms that the Pentagon approved early on in the crisis, and bailout funding that was directed at some of their suppliers.
I was told it was a good investment even if they wasted it.
General Dynamics, which specializes in military weaponry including tanks and nuclear submarines but also owns the Gulfstream business jet manufacturer, saw a modest increase in revenue over the previous quarter. Gulfstream actually sold more jets in the most recent quarter than Boeing did, a mark of how the pandemic has altered the playing field.
The subs are turkeys!
Northrop Grumman saw a 7 percent increase in the most recent quarter despite over $800 million in COVID-related costs. The growth was driven in large part by new business in the company’s space systems division. It secured a leadership role in an $85 billion program to rebuild the nation’s intercontinental ballistic missiles.
Lockheed Martin, the world’s largest defense contractor and the maker of the F-35 Joint Strike Fighter, had its best quarter ever. It reported record sales of $16.5 billion, representing an 8.7 percent increase over the previous quarter.
Things are going so well at Lockheed that the company was able to “accelerate” roughly $1.8 billion to its suppliers. It also increased its quarterly dividend by about 8.6 percent.
George Ferguson, an aerospace analyst with Bloomberg, said the recent results also show how some companies may have over-invested in commercial aircraft before the crisis.
“With every economic expansion, management teams sort of lose their minds,” Ferguson said. “You get to the end of the expansion and commercial is rising so fast that they’d like to put all of their business there, and then you’re reminded that air travel can stop on a dime.”
It's never meant to take off again, either.
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