ROANOKE TIMES
Copyright (c) 1995, Roanoke Times
DATE: Saturday, December 23, 1995 TAG: 9512250023
SECTION: BUSINESS PAGE: A-8 EDITION: METRO
DATELINE: RADFORD
SOURCE: ELISSA MILENKY STAFF WRITER
The Radford Army Ammunition Plant said Friday it will begin making a propellant used to inflate automobile air bags, part of a continuing effort to bring commercial business to the government-owned facility.
The one-year contract, beginning in February, is between Alliant Techsystems Inc., the arsenal's Edina, Minn.-based commercial operator, and OEA Inc. of Denver.
It calls for the ammunition plant to produce as much as 50,000 pounds of propellant for air bags installed in 1997-model cars. Other terms of the contract were not disclosed.
"This is an entry into a new business for us," said Bruce Webb, the ammunition plant's program manager. "We think as many as three air bags will be installed in cars by the turn of the century." By 1997, all new cars must be equipped with driver- and passenger-side air bags.
The ammunition plant manufactures rocket propellant and explosives for the military. The propellant it will make for OEA, the world's largest producer of the device that inflates the air bag, is similar to about 25 percent of the products it makes for the government, Webb said. The plant will use the same equipment and facilities.
An environmental assessment prepared for the Army said making the new propellant will have little impact on the environment because it does not differ significantly from the products already produced at the arsenal.
This contract also will not have much impact on the plant's employment, mainly because it does not call for a high volume of propellant. No new jobs will be added, and company officials say the new contract may not slow the steady tide of layoffs and work-force reductions.
In November, the plant offered retirement incentives to 160 employees older than 50. On Jan. 1, 100 of the employees who accepted the plan will retire. About 1,200 people work at the plant, down from 4,148 in 1990.
"It really helps to smooth things out, but there's not a direct or immediate impact that we can talk about," Webb said.
However, Webb said Alliant Techsystems hopes to obtain more contracts to manufacture the propellant, and the company has been in contact with several major air bag manufacturers and hopes to continue business with OEA.
"It's quite likely that requirements for 1998 will be very different, and we'll be competing with others who make propellant,'' he said. "It will pretty much be on a year-to-year basis.''
OEA makes hybrid air bag inflators, which are installed with propellant and containers of compressed gas. Gas is needed to quickly deflate the air bags after they are activated.
Propellant works in guns by burning, thereby creating a gas that pushes out the bullet - or in this case, the air bag. The propellant the ammunition plant is producing for air bags iscreates relatively little smoke and no toxic fumes, which made it attractive to OEA, WEbb said.
OEA, a publicly traded company that posted $129 million in sales last year, produces air bag inflators and initiators, the device that sets off the inflator. The company also makes devices and explosives for the aerospace industry, including crew escape systems for high speed aircraft.
Paul Martin, OEA vice president, said his company is contracting with several other businesses for materials.
"The first year may not be that significant," said Martin, who added that OEA will produce 3 million inflators for 1997 model year cars, a number that will double in 1998. "I think the real potential is in the outyear."
Alliant Techsystems is the second company in the area to enter the air bag business recently. Precision Fabrics Group Inc.'s Vinton plant, which makes industrial fabrics, said in June it will manufacture the fabric for a newly designed air bag.
LENGTH: Medium: 71 linesby CNB