Malloy, Lockheed Martin reach deal to keep Sikorsky in Stratford
Sikorsky Aircraft will stay in Stratford for at least the next 16 years thanks to a deal reached between Gov. Dannel Malloy and Lockheed Martin, Sikorsky’s parent company.
Malloy announced Tuesday that he and Lockheed Martin had reached an agreement that will have Sikorsky building nearly 200 CH-53K King Stallion helicopters for the U.S. Navy until at least 2032.
The deal, according to a statement from Malloy’s office, is subject to legislative and union approval. It will retain and grow approximately 8,000 jobs at Sikorsky, which is headquartered on Main Street in Stratford.
As part of the deal, Lockheed Martin will keep Sikorsky headquarters in state as a primary production facility for its government-based helicopter business, retain and grow its full-time employment to more than 8,000 by the end of 2030, nearly double its spending of $350 million per year with state suppliers and increase its capital spending for machinery and equipment by 22%.
In exchange, the state will provide financial incentives to Lockheed of up to $220 million over the term of the agreement. That will include earning grants of up to $8.57 million annuall over the deal by meeting certain benchmarks such as retaining at minimum level job growth, payroll spending, utilizing in-state suppliers. Lockheed will also be exempted from sales and use taxes up to $5.7 million per year for the life of the deal. Also, Lockheed will be eligible for a performance incentive if it exceeds the target level employment by 100 to 550 jobs in any given year. The incentive grant will be up to $1.9 million for a total of up to $20 million.
Malloy hailed what he called “a significant deal with wide-reaching ramifications.”
“It ensures that great manufacturing jobs – thousands of them – will remain in Connecticut, and that Sikorsky’s extraordinary record will continue to flourish for years and years to come right here at home. If we don’t do this deal, we risk losing thousands of good-paying jobs,” Malloy said. “This isn’t just about Sikorsky and our new relationship with Lockheed Martin – it’s also about the supply chain companies and their employees that will benefit from the CH53K being built by Sikorsky. These companies are in every corner of our state. Today, we are supporting the small- and medium-sized businesses that are the backbone of our state and local economy. This is something that we all should celebrate.”
Sikorsky President Dan Schultz said the deal is “a significant first step in the three-way partnership between Sikorsky, the state and Teamsters Local 1150,” which represents Sikorsky employees.
“It is important for the company’s ability to meet our customer requirements, for our employment stability amid continuing and difficult financial pressures on our industry, and for our future,” Schultz said. “I thank our partners for their support and look forward to completing this deal. Assuming the state’s proposal is approved by the legislature and the union agreement is ratified, Sikorsky will be able to transition the CH-53K production work to Connecticut.”
The state Legislature must vote on the agreement by Oct. 7 in order for Lockheed Martin to meet U.S. Department of Defense production requirements.
Lt. Gov. Nancy Wyman also applauded the deal.
“This is a historic agreement that will secure thousands of jobs in the years ahead – both at Sikorsky and also at their many supply chain partners throughout Connecticut,” Wyman said. “While we’ll need to move quickly with our partners in the General Assembly, it’s important that they vote on this deal. It’s part of our shared commitment to grow Connecticut jobs and strengthen our economy.”
Malloy will host a press conference at 3 p.m. Wednesday to offer more details on the deal.
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