Boeing rotorcraft chief says prospects for foreign sales bright
WASHINGTON (Reuters) - The head of Boeing Co's (BA.N) rotorcraft unit said strong international demand would help limit the pain of a decline in U.S. military spending and that discussions with Japan about a possible purchase of V-22 tiltrotors had accelerated in recent months.
Japanese interest in the aircraft - which takes off and lands like a helicopter, but flies like a plane - has grown now that the U.S. Marine Corps has deployed the aircraft there for over a year. Public resistance to the V-22s on the island of Okinawa, which has a large U.S. military presence, has also diminished.
"They've started to see the capabilities because of the U.S. presence over there. They're starting to resonate with the platform itself," Leanne Caret, vice president and general manager for vertical lift in Boeing's defense division, told Reuters in an interview.
Caret added that there had been interest in the aircraft in the Middle East. "An order from the Middle East will open some serious doors," she said.
A senior Pentagon official told Reuters in June that the U.S. government had provided briefings to Saudi Arabia, Qatar, the United Arab Emirates, Italy, Brazil, Colombia, Singapore and Australia about the V-22 aircraft, also known as the Osprey.
Caret said executives from Boeing and Bell Helicopter, a unit of Textron Inc (TXT.N), are in Israel this week to help support the sale of V-22 tiltrotor aircraft that was announced by Defense Secretary Chuck Hagel in April.
The expected downturn in U.S. defense spending was similar to declines seen after the end of other military conflicts, but this was the first time that there was such strong international demand at the same time, she said.
Recent wins in helicopter competitions in South Korea, which ordered Boeing's Apache helicopter, and India, which is buying CH-47 Chinooks could help generate additional sales in those respective regions, as well as follow on work for aircraft support.
"That's going to open up more areas of opportunity in that region as those aircraft continue to demonstrate their capabilities," she said, noting that the company planned to have a large presence at both the Dubai and Singapore air shows.
With the Pentagon bracing for over $1 trillion in spending cuts over the next decade, Boeing is also focused heavily on ensuring that it delivers its aircraft to the U.S. military as promised.
Boeing has multiyear purchase agreements with the Army and Navy for its CH-47 Chinook helicopter and the V-22 but even those contracts could be reexamined if the current difficult budget climate continued, Caret said.
"So we're being very cautious and we're making certain that we stay focused," she said, noting that Boeing also continued to invest in new technologies and other efforts to drive down the cost of producing new weapons.
Boeing and Sikorsky Aircraft, a unit of United Technologies Corp (UTX.N), on Monday announced that the helicopter they are developing jointly for a new joint multi-role helicopter program for the U.S. military would be named "Defiant."
(Editing by Edwina Gibbs)
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