June 16, 2009 / 1:47 PM / 10 years ago

Boeing says C-17 orders to extend line

PARIS (Reuters) - Boeing Co (BA.N) (BA.N) said additional orders for eight C-17 cargo aircraft would extend the company’s production line “well into 2011” if approved by the U.S. Congress.

Jean Chamberlin, head of the C-17 program for Boeing, welcomed moves by U.S. lawmakers to add eight more planes in fiscal year 2009 and said the company would continue to lobby Congress for 15 planes to be added in fiscal 2010.

U.S. congressional negotiators on Thursday approved a $106 billion compromise bill that includes $2.2 billion for the C-17 planes, which were not requested by the Pentagon. Democrats, who control Congress, expect both chambers to approve the bill next week.

Chamberlin said orders already on hand would keep the production line running through January 2011, but the eight extra planes would extend it well into that year.

“This program is just a tough program. You know you’ve got to fight every day, and certainly you have your ups and downs,” Chamberlin told Reuters in an interview at the Paris Air Show.

Lawmakers have added dozens of planes to the U.S. defense budget in recent years to secure thousands of jobs linked to the program and ensure the U.S. military has enough airlift capability.

Chamberlin said Boeing initially sought 15 aircraft in the fiscal 2009 supplemental budget to maintain economic order quantities, but said Boeing would be able to make do with the eight that have emerged, given orders of three planes for an international consortium made up of allies in the North Atlantic Treaty Organization together with Sweden and Finland, as well as four ordered by the United Arab Emirates.

The first of the NATO airplanes would be delivered in July, with the next two to follow in September and October. That amounted to a delivery time of about two years, far better than the usual three to five years for international orders.

Boeing would continue to aggressively market the plane overseas, highlighting its quick delivery times, while working to further lower the cost of the airplanes, Chamberlin said.

The company had made some “pretty dramatic reductions” in the aircraft’s price since its inception, essentially halving the price, but continued to work hard to lower production costs at its own facility and through working with suppliers.

She said there had been informal contacts with European governments facing a gap in their transport capability given delays in the development of the EADS EAD.PA A400M military transport, but no formal requests for C-17s had come in.

She said statements by the German and French heads of state about the need for six more months to discuss the future of the A400M had dashed her hopes for clinching any orders for C-17s as gap-fillers at the Paris Air Show.

Tough economic pressures and tightening budget also meant the European governments might be inclined to upgrade existing aircraft, rather than ordering new ones.

“They’re going to be looking to make do with what they have,” she said.

Chamberlin said Boeing also had not received a formal request from India for 10 C-17s, despite comments from the country that it planned to order the planes.

Longer term, she said Boeing hoped that the U.S. Congress would allow the Air Force to retire some 59 aging C-5A aircraft, which could translate into further C-17 orders for the U.S. Air Force.

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