- The Washington Times - Sunday, June 15, 2003

LE BOURGET, France (AP) — The heads of the world’s two biggest passenger-jet makers yesterday underlined the grim economics in aviation — while sticking with their forecasts for the number of planes they will deliver this year.

The head of U.S.-based Boeing’s passenger-jet business, Alan Mulally, said the company was on target for 280 deliveries, while Noel Forgeard, chief executive officer of Airbus, confirmed his target of 300 aircraft this year.

The two bitter rivals have struggled to keep orders and deliveries flowing as airlines have cut passenger capacity and mothballed planes. Severe acute respiratory syndrome, wars in Iraq and Afghanistan, and economic uncertainty in Europe and the United States have depressed air travel.

Meeting the goal of 300 “will be quite an achievement in view of existing conditions,” Mr. Forgeard said. Airbus delivered 303 aircraft last year.

Still, Mr. Forgeard said that “the three years ahead will be difficult for all industry players, including Airbus” and described the downturn in the airline business “as the most severe crisis the aviation industry has ever faced.”

Mr. Mulally said Boeing was working intensely with customers and had cut production capacity because fewer planes were needed. “It’s really tough for the airlines,” he said. “They need to get their balance sheets repaired and get profitable again.”

He said Boeing would deliver 280 aircraft this year, down from 381 last year, and 275 to 300 next year. Orders probably would begin to recover in earnest in 2005, he said.

Both executives were upbeat about prospects past 2005, with both plugging their very different concepts for the next leap forward in air travel — Airbus with its giant 550-seat A380, to enter service in 2006, and Boeing with its fuel-efficient 7E7 expected to begin in 2008. Neither plane has flown yet.

Mr. Forgeard touted the progress the company was making on the A380, saying that 96 percent of the supplier selection have been completed and advance drawings are more than half made. “The A380 is a reality today,” he said.

Mr. Mulally said that the 7E7, to be made with extensive use of light composite materials instead of metal, is what the industry will need. “Smaller airplanes that have the capacity to go nonstop and long range” are the future, he said.

In 1985, large jets such as the 747 and DC-10 had 70 percent of trans-Atlantic traffic, but smaller planes such as the 767 and 777 now account for 60 percent.

Neither company expressed much worry about the roughly 2,100 planes that have been mothballed worldwide. Many of those are older planes that were near the end of their life spans, and only about 500 to 600 could be brought back into service, they both said.

In a nod to the U.S.-French tensions that have been a constant topic at the Paris Air Show, Airbus’ Mr. Forgeard said that his firm, based in Toulouse, France, supports 40,000 jobs in the United States.

Major U.S. companies such as Goodrich, Northrop Grumman, Rockwell Collins and Honeywell have signed on as suppliers of parts and systems for the company’s forthcoming A380.

The Pentagon barred its generals from attending the show — a move widely interpreted as retaliation for France’s opposition to the U.S.-led war against Iraq.

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