How US software ended up powering Chinese assault helicopters [View all]

[DainBramaged]

Why spy or steal when Western companies will sell you the tech you need?


In 2002, United Technologies Corporation was coming off its most profitable year ever. The various units of UTC, which owns businesses ranging from helicopter manufacturer Sikorsky to Otis (“the world’s leading manufacturer, installer, and maintainer of elevators”), had a net income of $1.9 billion off $27.8 billion in sales in 2001. Pratt & Whitney, the aircraft engine unit of UTC, was poised to bring in billions more from defense contracts, supplying the engines for Lockheed-Martin’s F-22 Raptor, the F-35 Joint Strike Fighter program, and the Boeing C-17 Globemaster III cargo plane.

But there were still opportunities to make even more money. One of the most promising came from Pratt & Whitney’s Canadian subsidiary, which had a plan to open up an entirely new market—China. Large risks were involved, however: the program was shrouded in secrecy, for one. It also involved working with partners who had a reputation for ripping off technology.

And it just happened to be illegal.

Pratt & Whitney Canada wanted to help China's state-owned Aviation Industry Corporation (AVIC) develop the Z-10—China’s first modern attack helicopter, comparable to the US Army’s AH-64 Apache. While operating under the cover story that this was a “dual use” helicopter—built both for civilian and military purposes—at least some people in Pratt & Whitney Canada’s marketing and export team knew exactly what they were getting into.

In an August 2000 e-mail, a Pratt & Whitney Canada marketing employee described the negotiations with AVIC and the China National Aero-Technology Import and Export Corporation (CATIC) this way, according to documents released last week by the US Department of Justice: "Discussions on the P&WC engine for Chinese Z-10 attack helicopter are progressing smoothly. From the attendance at the meetings, it is clear that this is a serious effort and they have a tight timetable.”

http://arstechnica.com/tech-policy/2012/07/how-us-software-ended-up-in-chinese-assault-helicopters/