Business

November 30, 2012

Boeing hopes defense cuts would spare tanker

Joshua Freed
Associated Press

Boeing expects its new tanker for the U.S. Air Force to be untouched by cuts in defense spending next year, its top defense executive said Nov. 29.

Defense contractors have been getting ready for automatic defense cuts that are a part of the so-called fiscal cliff that starts in January if Washington lawmakers can’t strike a budget deal. Those cuts total $55 billion for next year and about $500 billion over 10 years.

That would be on top of $500 billion in cuts to projected spending over 10 years that President Obama and congressional Republicans already agreed to last year.

Nearly half of Boeing’s revenue comes from defense and space programs.

Boeing has tried to plan for a worst-case scenario of $1 trillion in cuts over 10 years, said Denis Muilenburg, who runs its defense business. However, the company expects the actual cuts to be more like $750 billion, he said.

“We’ve been taking aggressive actions on workforce reductions, facility reductions, and other affordability actions, to protect ourselves against that worst-case scenario,” he said.

One of Boeing’s major defense projects is a new aerial refueling tanker for the Air Force. Even if there are spending cuts, “I think actions will be taken to protect the schedule on the tanker, and to keep it at a full funding level,” Muilenberg said.

To make up for declining Pentagon spending, Boeing has been trying to get more overseas business. For example, it’s selling F-15 fighter jets to Saudi Arabia. This year, international customers will account for more than 25 percent of Boeing’s defense business, Muilenberg said, up from 7 percent five years ago. He sees that running at 25 percent to 30 percent in future years.

The company is also looking for more overseas customers for its C-17 military cargo plane. India has ordered 10, with its first plane due this summer. Boeing has been delivering C-17s to the U.S. Air Force for 21 years, but has just five more to deliver on an order of 223.

Boeing has slowed production to 10 cargo planes per year, down from 15, Muilenberg said. At the slower rate it has enough orders to keep the Long Beach, Calif. assembly line running through the third quarter of 2014, he said. Boeing is aiming to get orders to keep it running longer than that, he said.




All of this week's top headlines to your email every Friday.


 
 

 
dassault

Dassault Falcon Jet establishes new pilot operational support team

Arnaud Paulmier, head of Dassault Falcon Jet’s new operational support team. Dassault Falcon Jet recently established a new Pilot Operational Support Team in Teterboro, N.J., to support operators in the Western Hemisphere. Th...
 
 

U.S. Navy awards Raytheon $49.5 million enhanced Laser Maverick production contract

The U.S. Navy has awarded Raytheon a $49.5 million contract for production of new laser-guided Maverick missiles (AGM-65E2/L). The Navy also intends to exercise a contract option to purchase additional units bringing the total contract value to $54.9 million. The Maverick weapon system, a U.S. Air Force-led joint service program, is a forward firing, precision-guided,...
 
 
Northrop Grumman photograph by Alan Radecki

Second Northrop Grumman-built Triton UAS completes first flight

Northrop Grumman photograph by Alan Radecki The second MQ-4C Triton, built by Northrop Grumman for the U.S. Navy, successfully completed its first flight Oct. 15 PALMDALE, Calif. – The U.S. Navy’s second MQ-4C Triton un...
 

 
Raytheon photograph

Poland’s PIT-RADWAR signs letter of intent with Raytheon

Raytheon photograph Mike Shaughnessy, Vice President of Supply Chain, Raytheon Integrated Defense Systems and Jerzy Milosz, Member of Board and Director of R&D, PIT-RADWAR sign a letter of intent to explore further partners...
 
 

Raytheon to resume work on new electronic warfare planning management software program

The U.S. Army has directed Raytheon to resume work on an Electronic Warfare planning management software program that for the first time will give it automated tools to help plan and execute complex electronic warfare missions. The program restart follows a ruling by the U.S. Court of Federal Claims, which denied the protest filed by...
 
 

Northrop Grumman JCREW achieves milestone C; Program to enter production, deployment phase

Northrop Grumman has received Milestone C approval for its Joint Counter Radio-Controlled Improvised Explosive Device Electronic Warfare Increment 1 Build 1 (I1B1) system from the U.S. Naval Sea Systems Command. The JCREW I1B1 system is a jammer that defeats devices used to trigger improvised explosive devices (IEDs). Northrop Grumman developed mounted, dismounted and fixed-site variants...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>