DUBAI (Reuters) - Top Boeing Co (BA.N) executives are upbeat about the future of the F/A-18 Super Hornet fighter jet and see a good chance of winning additional U.S. and international orders that would keep the production line running past 2016.
Boeing Chief Executive Jim McNerney told reporters at the Dubai Airshow it was difficult to predict future orders given continued uncertainty about the U.S. budget.
“I can’t predict the future exactly, but I think there is a good chance of more orders from the U.S. government,” McNerney said.
He said he also saw “a good chance” that Brazil would ultimately select the F/A-18 in a fighter jet competition that has been delayed after reports that the U.S. National Security Agency spied on Brazilian President Dilma Rousseff.
“I could imagine a worst case scenario where the line shuts down in three to four years, but I don’t think that will come to pass,” McNerney said.
Boeing is showing the F/A-18 fighter jet at the Dubai Airshow as it seeks orders that will extend the production line past 2016, when it is currently expected to end.
Mounting budget pressures in the United States, and the Pentagon’s decision to focus on the Lockheed Martin Corp (LMT.N) F-35 fighter jet, coupled with delays in foreign competitions mean Boeing must decide soon whether to invest its own money to keep the line running until firm orders emerge.
Dennis Muilenburg, who heads Boeing’s defense division, said the company decided this year to close its C-17 production plant in Long Beach, California and its Wichita, Kansas plant to preserve cash for investment in the F/A-18 fighter line.
Muilenburg said he was not expecting a decision to close the F/A-18 anytime soon.
“That’s exactly why we did things like ... shutting Wichita and shutting down the C-17 line so we can continue to invest in product lines that have longevity, and that’s why we’re investing in the F/A-18 line,” Muilenburg told Reuters in an interview at the air show.
“We are intentionally putting R&D into that platform because we believe it has longevity for our customers,” he said, citing Boeing’s work on developing a package of upgrades to improve the popular Navy F/A-18 fighter jet, and the older F-15 jet.
He declined to spell out the exact amount invested in the line, saying only, “It’s one of our largest investments.”
“We think that combination of capability and cost and schedule certainty is one that’s in demand now, and will be a decade from now, and decades to go,” he said.
He said the company would have to decide over the next year whether to self-fund certain items to keep the line going, but said he did not expect a decision to close the fighter line.
He said the company expected dozens of additional orders, but that number could grow to over 100.
Muilenburg said Boeing’s F/A-18 and F-15 jets were under consideration by several Arab countries, including United Arab Emirates, Qatar and Kuwait. Canada, Denmark and Malaysia also have fighter competitions under way.
Canada and Denmark initially planned to buy Lockheed’s F-35 fighter, but have recently restarted competitions.
Reporting by Andrea Shalal-Esa. Editing by Jane Merriman