Defensive pressure on Boeing

Chicago Tribune ^ | January 6, 2006 | Ameet Sachdev

[ConservativeStatement]

Fortunately for Boeing, slowing defense growth comes at a time when the other half of its business, commercial airplanes, is flying high again. The company reported a record 1,002 jet orders last year, thanks to surging demand in Asia and the Middle East and thriving low-cost carriers.

While many analysts expect commercial orders to slow in 2006, Boeing's factories should be humming for years to come barring any production glitches. And sales should receive another boost once the U.S. airline market recovers.

But the defense cutbacks will prompt Boeing to take out its own budget ax next year.

"We're going to be making some significant inroads in 2006," said James Albaugh, head of Boeing's $30 billion military division known as Integrated Defense Systems.

While the details of the cost-cutting are being worked out, Albaugh said Boeing will not drop programs.

[Wiz]

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