Boeing sees little Spirit impact, pitches export credit
(Reuters) - Boeing Co (BA.N) on Wednesday stuck by its forecast for plane production despite turmoil at a key supplier, and made a pitch for export credit for aircraft sales, addressing criticism that use of such government-backed loans is unfair to U.S. airlines.
Boeing said its production rates are unlikely to be affected by the potential sale of the wing division of Spirit Aerosystems Holdings Inc (SPR.N), which warned of a second-quarter charge of up to $400 million on Tuesday and delayed its earnings release. [ID:nL1N0G70EH] The Wichita, Kansas-based supplier makes wing pieces for all of Boeing's aircraft models and produces fuselages for its top-selling 737 model.
Boeing still plans to increase production of 737s to 42 a month by mid-2014 from 38 currently, Randy Tinseth, marketing vice president, said at a briefing in Washington, D.C.
"We assume we'll find a way to build these airplanes," he said.
Export credits have become a hot issue since Delta Air Lines Inc (DAL.N) sued the U.S. Export-Import Bank in April in an effort to stop their use for Boeing's 777 and 787 planes.
Delta wants the Ex-Im bank to stop helping state-owned foreign airlines buy wide-body jets from Boeing, because it says that puts U.S. airlines at a cost disadvantage. The airline noted that Emirates Airline EMIRA.UL and Korean Air Lines Co Ltd (003490.KS) - among the biggest buyers of 777 and 787 planes - do not use U.S. government aid.
Delta was joined in the lawsuit by the Air Line Pilots Association, which represents 47,000 pilots at 28 U.S. airlines, and Hawaiian Airlines, the largest carrier in Hawaii.
Boeing said the government-backed credits create substantial value at no cost. Boeing supports 1.4 million U.S. jobs in all 50 U.S. states, said Kostya Zolotusky, Boeing's managing director of capital markets and leasing.
The debate about export finance "is putting pressure on how airlines - our customers - view the predictability of Boeing airplanes being paid for," Zolotusky said.
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