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B-173451 1 (1972-01-20)

handle is hein.gao/gaobaagqa0001 and id is 1 raw text is: ,Dear Mrs. Grasso: LM096697 In your letter of June 23, 1971, you requested our Of- fice to review the Department of the Army's purchase of some of the Hamilton Watch Company's'equipment and the Army's re- lated noncompetitive contract award for M565 mechanical time fuzes. Some of the equ-ipment is used to manufacture pinions-- the fuzes' precision parts. The Army stated that pinions had been purchased extensively overseas and that the mobili- zation requirements for them could not be met by domestic V-i~i-nn pr-6_duc-ers... In subsequent discussions with your office, we agreed to evaluate the Army's actions by reviewing the re- ported principal producers' capacities to manufacture pinions. In July 14, 1971, hearings before the Subcommittee on H : Defense of the House Committee on Appropriations, Army offi- cials stated that, to maintain the present domestic base and to retain skilled employees, the Army was negotiating with Hamilton to buy certain of its equipment, to lease its plant, and to place sufficient production with it to keep the plant active through January 1972. PURCHASE OF CERTAIN HAMILTON ASSETS The Army stated that the domestic watch and clock indus- try, which then was the exclusive source of M565 mechanical time fuzes, had been declining since 1948. Mobilization re- quirements for the time fuzes exceed domestic capability, and extensive imports of precision parts, particularly pinions, have been used to meet recent military requirements. After Hamilton notified the Army in December 1970 that it would liq- uidate its ordnance operation and dispose of its equipment, the Army decided to purchase the equipment and lease one of the buildings. The Hamilton facility is particularly valuable to the fuze production base because it has integrated capability. According to the Army the facility can produce all of its re- quired precision components, including pinions, without rely- ing on imports. 50TH ANNIVERSARY 1921-1971

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