October 31, 2006

C-17 line needs 12 orders to continue
Boeing wants a firm commitment from the Air Force to keep operations running in Long Beach.

Copley News Service

WASHINGTON -- Boeing officials said Monday they were confident that a new military global mobility study would show the need for many more C-17s and that there were customers interested in buying at least 40 commercial versions of the long-range transports.

But they will need a firm commitment from the Air Force to buy at least 12 more C-17s in the fiscal year 2008 defense budget to keep the Long Beach production line going long enough for that to happen, the officials said.


Without funding for 12 more C-17s in the new budget, which should go to Congress in February, Boeing would have to shut down the line by December 2009, said David Bowman, C-17 program manager, in a telephone conference call.

The C-17 program employs about 6,000 workers in Long Beach and thousands more elsewhere in California and nationwide.

Despite an earlier mobility study that said at least 222 C-17s were required, the Air Force announced last year that it would buy only the 180 Globemaster IIIs under contract. As a result, Boeing informed its suppliers in August to stop making parts for additional aircraft. The company had already spent "tens of millions" of its own money to keep the supply chain going in the hope of additional sales, Bowman said.

Then Congress overruled the Air Force and provided funds for 10 more C-17s in the fiscal year that started Oct. 1. Those planes -- and expected orders for 15 more for U.S. allies -- will keep the line going an additional year.

To extend the line beyond that, based on a 30-month lead time for components, Bowman said, Boeing will need a Pentagon commitment for "a minimum of 12" more transports in the new budget. Those plus the expected international buys would fill out the optimum production run of 15 a year and keep the line going through the fall of 2010, he said.

Bowman noted that Congress ordered the Pentagon to complete a new study of airlift requirements, but that would not be completed before Boeing would again have to cut off the supply line.

"It would be a travesty to allow this production line to permanently shut down before clearly assessing and understanding our nation's strategic and tactical mobility requirements," Bowman said.

John Sams, Boeing's director of Air Force programs, noted that the Air Force has "an opportunity to solve the airlift requirements of our nation for the next 30 years, as long as we don't stop short on C-17 production and then cause another problem further down the road."

Boeing could restart the line, but that would cost the nation a lot more, Bowman added.

Boeing has been trying to promote a commercial version of the Globemaster, called the BC-17. Although it has no firm orders, Bowman said it has been working with half a dozen potential customers who could buy "40 or more C-17s."

"I think we can get an order in months, if the customers who are interested right now know there was a sustaining line to carry us through the two- to three-year timeframe" required to modify the military C-17 and to get Federal Aviation Administration certification for the commercial version, he added.

But it would require additional Air Force buys to keep the line going at an efficient rate because the potential commercial customers could not buy enough to sustain the 15-a-year production, Bowman said.