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Manufacturing Processes

page 7

Consideration of COCOM and Export Administration Regulations

COCOM and Export Administration Regulation reviews were conducted to assess sensitive components in the Garrett TFE-731-2A-2A. When Allied Signal╠s Garrett Engine Division upgraded the TFE-731-2A-2A with the addition of a digital engine controller, it claimed that the new system did not require an export license under the revised Export Administration Regulations and COCOM controls. It was determined that COCOM had not developed an agreed-upon technical definition to distinguish restricted from unrestricted engine controllers.152 This shortfall in the regime set the stage for an extended interagency debate over the status of the TFE-731-2A-2A vis-à-vis COCOM regulations.

The Defense Department believed the Garrett engines contained an embargoed, full authority digital engine control (FADEC) system. Moreover, the Defense Department obtained new information about improvements to the Garrett TFE-731-2A-2A that raised additional national security concerns.153

Regarding the FADEC issue, the Defense Department acquired analysis and technical studies from numerous sources. A Defense Technology Security Administration analysis explained, for example:

The Garrett engine contains what [Allied Signal] calls a Digital Electronic Engine Control (DEEC) but describes in company literature as "full-authority, automatic engine control." DTSA maintains that the DEEC is a FADEC for the following reasons:

FAA certification officials state in writing that the "DEEC" controller is a FADEC. Also DoD experts at the Air Force Aeronautical Systems Center and the Naval Air Warfare Center have assessed that the Garrett engine controller is a FADEC.154

Additional confirmation of these findings was contained in a technical paper developed by the engineering staff at the Defense Technology Security Administration.

In summary, the entire DoD Category 9 [aero-engines] negotiating team to COCOM during 1990-91 . . . are in agreement after detailed analysis, with assistance from experts in controls from Navy, Air Force and FAA, of data proprietary to Allied-Signal and otherwise, that the ASCA [Allied Signal Controls & Accessories division] DEEC, P/N 2118002-202 is a FADEC.

Allied-Signal╠s memo to DTSA . . . shows this is indeed the FADEC utilized on the GED [Garrett Engine Division] TFE731-2A-2A engine.

The Defense Department inquiry found further that Allied Signal initially did not provide accurate information to the Federal Aviation Administration during the civil certification process for the TFE-731-2A-2A:

GED [Garrett] was rebuked by FAA engineers in 1988 for their claim that the -2A engine was a direct derivation from a -2 engine rather than being derived from a TFE731-3. GED subsequently provided FAA with a corrected derivation showing that the engine was actually a TFE731-3 with TFE-731-3B parts and components rather than TFE731-2 components.

Substantial improvement to the TFE731-2A engine occurred when the so-called "Extended Life Turbine Modifications" were added during December, 1991, only one month after DOC [Commerce] had notified GED it had decontrolled the engine¸.

The Extended Life Turbine (ELT) resulted from the NASA program to obtain significant reductions in noise and emission levels, i.e., decreased infrared (IR) signature. The ELT has an enhanced damage tolerance and changes TFE731-series engines from an expected life of approximately 6,000 hours to 10,000 hours.

In summary, the engine GED [Garrett] submitted for a ╬paper certification╠ as a TFE731-2A in 1988 was not a derivative of a -2 engine but was derived from a TFE731-3 with a TFE731-3B LP compressor. The changes noted above were included in the 1988 engine, i.e., the A5 seal and both LP compressor and turbine blades changed. The ELT was added in 1991.

In conjunction with the slight derating of the engine in 1988, life expectancy of this engine is greatly enhanced over a TFE731-3 turbofan engine; it is more durable, reliable, and generally more appropriate for use on military aircraft. No applications of this engine to civil airframes are known to have been attempted by Allied-Signal, only military.155

The evidence obtained by the Defense Department indicated that the TFE-731-2A-2A was not simply a 20-year old engine for business jets, as Allied Signal and Commerce Department officials had claimed.156 (Indeed, as of January 2, 1999, the TFE-731-2A-2A has never been used in a business jet.)157

In truth, the engine had been derived from the TFE-731-3, an engine used in civil and military applications, including the Cessna Citation III business jet and the CASA C-101BB ground-attack jet. But the engine had been upgraded with a new turbine to lower its infrared signature, thus improving the combat survivability of the aircraft in which it would be contained █ for example, through the ability to escape detection by surface-to-air missiles.158

Resolution of the Garrett Engine Controversy

The Garrett engine controversy was ultimately resolved through an interagency agreement at the Deputy Assistant Secretary level. Regarding the disputed engine controller, the Deputy Assistant Secretary of Defense for Counterproliferation Policy, Mitchel B. Wallerstein, described an interagency compromise in a March 21, 1994 letter to the Deputy Assistant Secretary for Export Controls at the State Department:

Defense is prepared to agree with the Allied (and Commerce) determination that the engine does not include a Full Authority Digital Engine Control System (FADEC) which meets the IVL [Individual Validated License] criteria¸.With respect to the 2A-2A engine, our proposed carve out from the definition of FADEC would provide a basis for a Commerce G-DEST classification which would allow sales of the 2A-2A engine to the PRC, including its military, without prior [U.S. Government] review and approval. It is unclear whether such a definitional carve out would require multilateral coordination with our current allies before such a G-DEST classification is made.159

The State Department agreed with this proposal, and stated further: "We do not believe that it is necessary to coordinate multilaterally with our COCOM partners before moving to G-DEST treatment." 160

Peter M. Leitner, senior trade advisor at the Defense Technology Security Administration, believes that the "definitional carve out" entailed a political decision to change the definition of the engine controller in order to circumvent export regulations and, in this case, avoid a COCOM review. According to Leitner, "you come up with some unique definition of the item and try to exempt or carve out¸ coverage of that item in the regulations." 161

Baird believes that COCOM reviewed the export license application for the upgraded variant of the Garrett TFE-731-2A-2A.162 Webb believes COCOM did not review the application.163 The Commerce Department was unable to provide records of any COCOM review conducted for the upgraded Garrett engines.164

Defense Department records indicate that some U.S. government officials believed a COCOM review of the upgraded engines was essential. Without such a review, the United States might be seen by its partners as attempting to "circumvent CoCom controls." 165

Wallerstein interprets the reference to "a carve out from the definition of FADEC" to mean that the disputed FADEC engine controller would be removed or modified to ensure that the TFE-731-2A-2A could be exported without controlled technology.166 However, Wallerstein does not recall seeing any technical proposal from Allied Signal to modify the engine controller.167

The documentary record suggests that the final, upgraded variant of the Garrett TFE-731-2A-2A was never submitted for a review by COCOM, which ceased operations in April 1994.168

The status of the Garrett engines vis-à-vis the Enhanced Proliferation Control Initiative was largely resolved on August 19, 1993 during a meeting of the Commerce Department-chaired Operating Committee on Export Policy. According to a record of the meeting:

Commerce, State, and Defense have agreed to treat these commodities as if they were controlled. Moreover, [Allied Signal] has agreed not to transfer any co-production technology relating to these engines to the PRC.169

This interagency decision was finalized and reported in the news media in October 1995. As the Wall Street Journal reported then:

Allied Signal already has shipped about 40 built-up engines to China [the PRC] under the liberalized post-Cold War export rules, and isn╠t being deterred from exporting 18 more that the Chinese have ordered.

But when it sounded out the U.S. Commerce Department last summer about its coproduction plan, the company was told that if it formally applied for a license to do so the application would be denied under the rules of the Enhanced Proliferation Control Initiative¸. The company decided not to apply for the license.170

Between 1992 and 1996, Allied Signal reportedly exported 59 of these TFE-731-2A-2A jet engines to the PRC. Beijing╠s main interest was in acquiring a production capability for the engines; thus, it halted further orders when co-production plans were scuttled.171

The PRC Continues to Acquire Jet Engine Production Processes

The PRC is continuing its effort to acquire production processes for U.S. jet engines. For example, Pratt & Whitney Canada, a subsidiary of the Connecticut-based United Technologies, in February 1996 became "the first foreign company to establish an aviation parts manufacturing joint venture in China [the PRC] (with Chengdu Engine Company)." 172

The Chengdu Engine Company manufactures components for large jet engines used in Boeing aircraft.173 In 1997, a new joint venture was reportedly proposed for Chengdu.

A consortium of Pratt and Whitney, Northrop Grumman and Hispano-Suiza are offering a new aero-engine, the PW6000, specifically designed to power the AE-100 transport, and are planning to establish an aero-engine joint venture at Chengdu, Sichuan Province.174

The Chengdu factory also manufactures parts for the PRC╠s WP13 turbojet engine, which powers the PLA╠s F-8 fighter.175

United Technologies operates additional aviation joint ventures with Xi╠an Airfoil Technology Company and China National South Aero-Engine and Machinery Company. These ventures are largely comprised of manufacturing jet engine "cold section" components or producing relatively low-technology "hot section" components.176 United Technologies claims that it has coordinated these aviation projects fully with the appropriate export licensing organizations in the U.S. Government.177

The PRC may have also benefited from direct exploitation of specially designed U.S. cruise missile engines. According to published reports, the PRC examined a

U.S. Tomahawk cruise missile that had been fired at a target in Afghanistan in 1998, but crashed en route in Pakistan.178

Back  |  Forward


COX REPORT

Overview
pages 1 | 2 | 3 | 4

PRC Acquisition of U.S. Technology
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9

PRC Theft of U.S. Nuclear Warhead Design Information
pages 1 | 2 | 3 | 4 | 5

High Performance Computers
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10

PRC Missile and Space Forces
pages 1 | 2 | 3 | 4 5 | 6 | 7 | 8 | 9

Satellite Launches in the PRC: Hughes
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9

Satellite Launches in the PRC: Loral
pages 1 | 2 | 3 | 4 | 5 | 6

Launch Site Security in the PRC
pages 1 | 2 | 3 | 4 5 | 6

Commercial Space Insurance
pages 1 | 2 | 3 | 4

U.S. Export Policy Toward the PRC
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9

Manufacturing Processes
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10

Recommendations
pages 1 | 2 | 3

Appendices
pages introduction | A | B | C | D | E | F



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