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After the decision was made to terminate development of the F-20, measures were taken to ensure the program could be resurrected. There was still hope of selling the entire drawing package and tooling to a foreign country, which could then complete development of the aircraft with Northrop assistance. In the months after the termination, all the paperwork associated with the F-20 was carefully stored, and the administrators and engineers documented where they had left off so the work could be resumed. The unfinished GI1003 aircraft, the flightworthy GI1002, the numerous fabricated and purchased components and systems of other aircraft, the tooling and test equipment, were all put in air conditioned storage.

The head of F-20 avionics subcontracts and a cost accountant toured the country for six months, negotiating termination settlements with Northrop's vendors and co-developers. As part of these settlements, Northrop would receive royalties on future sales of that portion of the vendor's equipment it had developed at its own expense.

The first and most likely launch customer was still South Korea. "This deal has been cleared all the way through the Blue House", the Korean equivalent of the White House, assured a new set of Northrop marketeers. Indeed, it developed later that Northrop had paid millions of dollars in bribes to South Korean officials to ensure the F-20 would be resurrected in Korea. But the deal never developed. The officials were removed from power, and the bribes were uncovered. Northrop not only did not sell the aircraft but ended up paying substantial fines and being publicly disgraced.

Another potential customer was India. India had always been held at arm's length by the US government, but the F-20 was a good alternative to India's indigenous Light Combat Aircraft development. It had been proposed to India as early as 1984. In late 1991, after rejecting an offer from the Americans to transfer F-5E tooling and production to India, the F-20 was considered again. Northrop offered to transfer GI1002, GI1003, the tooling, drawings, and know-how to India. But the talks got nowhere, and were finally abandoned (details). Last ditch talks with Pakistan and other countries also led nowhere. Northrop shortly thereafter gave up marketing the aircraft. The tooling and work in progress were destroyed, GI1002 was handed over to the California Museum of Science and Technology for display, where it remains to this day.

By then the Berlin wall had come down and the Cold War ended. The international advanced weapons market that it had fueled collapsed utterly. Used F-16's and MiG-29's became available for very little money . Export of fighter aircraft stalled completely. Old fighter aircraft were replaced at a ratio of only one new aircraft for every three older ones. The number of active combat aircraft in the world declined from 37,600 in 1990 to under 27,400 by 2005. The number of fighter aircraft declined from 23,400 to 17,200. In the face of the availability of inexpensive, modern fighter aircraft surplus to the Cold War powers, the demand for new aircraft virtually evaporated. So perhaps it was actually a stroke of luck for Northrop that the F-20 did not go through after all.

Northrop itself, in the defense consolidation of the 1990's, positioned itself as a high-tech weapons integrator and abandoned the aircraft design and export market. It acquired Grumman, and paradoxically some of its 'enemy' subcontractors on the F-20, such as Westinghouse. By 2005 it was the third largest defense contractor, having survived with its own name at the top of the masthead while its larger competitors had passed into history. Arch-rivals General Dynamics, McDonnell-Douglas, Grumman, Vought, Fairchild, Martin, and North American Rockwell - all were absorbed into the big three of Boeing, Lockheed, and Northrop. If the F-20 was a stalking horse to divert the competition while Northrop secretly, stealthily obtained dominance in the new technology market, then the plan worked.

But Northrop remained the company that survived but somehow never built anything. It still lost every design competition (its F-23 advanced tactical fighter design lost to Lockheed's F-22, even though everyone agreed yet again the F-23 was aerodynamically superior; B-2 production was terminated after only twelve aircraft had been built, at enormous expense). But the modern Pentagon has perfected the art of spending billions in designated congressional districts without ever actually delivering anything or getting anything into production.

Next: Where Are They Now: The F-20's Competitors


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