LMT Lockheed Martin Corp

By Doug Cameron 

Lockheed Martin Corp. turned to an outsider to succeed Chief Executive Marillyn Hewson, appointing telecom industry veteran James Taiclet to lead the world's largest defense company by sales.

Mr. Taiclet, who will succeed Ms. Hewson in June, has been CEO of American Tower Corp. since 2004, and joined Lockheed Martin's board two years ago having worked for a variety of other big aerospace companies.

Lockheed Martin said on Monday that Ms. Hewson will stay on as executive chairman. Her shift after more than six years as CEO continues a series of successions at the largest U.S. defense companies, with Northrop Grumman Corp., BAE Systems Inc. and, later this year, Raytheon Co. all changing their top leaders.

Mr. Taiclet, 59 years old, will become president and CEO on June 15, and emerged as a contender to succeed Ms. Hewson after a number of other potential candidates, including former finance chief Bruce Tanner and aeronautics head Orlando Carvalho, opted to leave the company.

His extensive experience in the commercial sector comes as the Pentagon is trying to reform how it develops and buys weapons and services, using techniques from outside traditional defense companies in an effort to speed development and cut costs.

Lockheed Martin is reviving the chief operating officer role formerly held by Ms. Hewson, with Frank St. John taking the position from June. Mr. St. John, 53, has been tipped by analysts as a future CEO.

The succession plan was disclosed as defense companies wrestle with the impact of the coronavirus, especially on classified activities accounting for 20% or more of their business.

Lockheed Martin and peers have halted all but mission-critical travel and increased telecommuting, but classified work has to be conducted in-person at secure facilities.

The Bethesda, Md., defense contractor said it has staggered shifts at its secure facilities and introduced flexible working practices to limit interaction.

Mr. Taiclet, who is currently chairman, president and CEO of American Tower, is a member of Lockheed Martin's classified committee. He formerly ran the aerospace services unit at Honeywell International Inc., and was a senior executive at the Pratt & Whitney unit of United Technologies Corp., which makes the engines for the F-35 combat jet.

Ms. Hewson, 66, became CEO in January 2013 after CEO-elect Chris Kubasik was terminated when a relationship with a subordinate was found to have breached company rules.

Her appointment and that of Phebe Novakovic as CEO of General Dynamics Corp. in 2013 highlighted the relatively high concentration of senior female executives at U.S. defense companies. Kathy Warden was last year appointed to head Northrop Grumman, and defense accounts for three of the top 10 Fortune 100 firms with female CEOs.

Ms. Hewson is credited by analysts with mending relations with the Pentagon over cost overruns and delays with the F-35, the world's most expensive military program.

The F-35 continues to be plagued by technical problems, but cost-cutting efforts have reduced its price and the jet now accounts for almost 30% of Lockheed Martin's revenues, driving the company's backlog above $100 billion.

American Tower said its finance chief, Tom Bartlett, will succeed Mr. Taiclet as president and CEO.

--Colin Kellaher contributed to this article.

Write to Doug Cameron at doug.cameron@wsj.com

(END) Dow Jones Newswires

March 16, 2020 12:40 ET (16:40 GMT)

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