By Anna Edney and Dan Hart
Honeywell International Inc. (HON) is cooperating with a government probe into parts it provided for F-35 fighters that were made in China.
The equipment is “a common electrical sensor found on a circuit card that is widely available in commercial applications around the world,” Scott Sayres, a Honeywell spokesman said in an e-mail today.
“Honeywell did produce this component in China for a short period of time, and proactively and voluntarily decided to move production to a U.S. facility in 2012 after consulting with the Department of Defense and our partners. We believe we have followed all applicable U.S. laws and regulations relating to the manufacturing of defense-related components in China,” he said.
The Department of Justice contacted Honeywell in March about the sensor after the Morris Township, New Jersey-based company had begun moving production to the U.S., Sayres said.
The company is being investigated by the U.S. Justice Department for export and import procedures after using Chinese-made parts in equipment for the F-35, Reuters reported, citing three people familiar with the probe.
The Department of Defense had issued waivers for U.S. laws prohibiting Chinese-built parts being used in U.S. weapons in 2012 and 2013 after Honeywell had moved a production line for thermal sensors to China in 2009 and 2010, Reuters said. The $392 billion F-35 weapons system by Lockheed Martin Corp. is the military’s costliest.
“We have, and will continue to, fully cooperate with its review,” Sayres said.
The F-35 program has been plagued by delays and cost increases. The price tag for a fleet of 2,443 aircraft is a 68 percent increase from the 2001 projection. The program encompasses 1,300 suppliers in 45 states supporting 133,000 jobs -- and more in other countries.
Investigators from the Pentagon’s Defense Criminal Investigative Service are working with federal prosecutors on the case, Reuters said, citing a person familiar with the matter. The DCIS and Department of Defense declined to comment to Reuters. Honeywell declined to comment to Reuters on the DOJ probe. The Justice Department didn’t immediately respond to a phone call from Bloomberg News today about the investigation. http://www.bloomberg.com/news/2014-01-12/honeywell-said-probed-by-justice-on-trade-controls-reuters-says.html