January 26, 2005

RAND suggests anti-missile system for airlines may be too costly
Researchers say money would be better spent in other ways. A defense contractor strongly disagrees.

By Toby Eckert
Copley News Service

WASHINGTON -- Despite the possible threat posed by terrorists wielding shoulder-fired missiles, equipping commercial aircraft with anti-missile systems is not yet cost-effective and cheaper approaches should be pursued, an independent research group said Tuesday.

But one defense contractor working on such a system challenged that conclusion, saying it was based on outdated information.

The study by Santa Monica-based RAND Corp. concluded it would cost $11 billion to equip the nation's 6,800 commercial airliners with defensive systems, and operating costs would hit $2.1 billion a year. The federal government now spends about $4.4 billion on security for all modes of transportation.

Development, procurement and operating costs would be $40 billion over 20 years, the researchers estimated.

"If we decide as a nation to significantly increase spending on homeland security, then spending this much on anti-missile systems may be appropriate," James Chow, a RAND engineer who headed the project, said. "But given what we spend today, a large investment in technology still unproven in commercial airlines doesn't appear appropriate."

The report acknowledged that the economic losses from a successful missile attack on a civilian aircraft could total more than $15 billion over several months, judging from the impact the Sept. 11, 2001, attacks had on the airline industry and related businesses.

Jack Pledger, an executive at Los Angeles-based defense contractor Northrop Grumman, said Rand's cost estimates were extrapolated from military anti-missile systems and that a commercial system could be deployed more cheaply.

"The numbers they're quoting for operations and support are on the order of two times what our system is going to cost," Pledger said.

Last year, the U.S. Department of Homeland Security awarded contracts to Northrop Grumman, United Airlines and British-based BAE Systems to come up with proposals for airline defense systems. The department said it was embarking on a two-year, $122 million effort that could result in equipping flights with laser systems, flares or other technology to deflect missiles fired by terrorists.

Pledger said his company's technology, which uses an infrared beam to disrupt a missile's guidance system, would cost about $1 million per plane to install. Plans call for deploying it on two commercial aircraft next year.

The RAND report is the latest development in a long-running debate over how best to guard aircraft against a missile strike, and whether the government or cash-strapped airlines should pay for the defenses. Sen. Barbara Boxer, D-Calif., and several other lawmakers have been pushing for the installation of sophisticated defensive systems on airplanes.

Thousand of lightweight, shoulder-fired missile systems are unaccounted for worldwide, and security experts fear terrorists have acquired them.

Concern peaked in 2002, when al-Qaida members tried to shoot down an Israeli airliner as it was taking off from an airport in Kenya. There has been widespread speculation that Israel has equipped some of its commercial jets with missile defense systems similar to those used by the military.

The RAND study said the most promising technology is a laser jammer that disrupts a missile's guidance system, sending it off target.