WASHINGTON - Boeing Co. ordered suppliers Friday to stop work on C-17 aircraft for which there is no buyer, taking a step toward ending production of the air force's premier transport plane by mid-2009, company officials said.
The officials said the action was reversible but had to be taken because of the air force's decision not to order more C-17s than the 180 it has already committed to buy.
"I believe the government is facing a very severe funding issue, and they are making some tough choices," said Ron Marcotte, vice president and general manager of Boeing Global Mobility Systems.
"Arguably, I think they are making the wrong choice," he said.
The aircraft, known as the Globemaster III, is the heart of the air force's fleet of long-range transport planes, and plays a central role in supply US forces around the world.
The Boeing directive affects suppliers of parts for aircraft for which the company has no buyer.
Boeing has been funding the manufacture of 22 C-17s out of pocket for the past year in hopes of selling them to the air force or to international buyers, and keeping production lines open.
The officials said they had lined up contracts or commitments for 18 of the 200 million dollar aircraft but not the final four.
"We simply can't continue the funding at our own risk," said John Sams, vice president for air force systems of Boeing Integrated Defense Systems, in a teleconference with reporters.
Marcotte said if nothing changes, the last C-17 will roll off the production line at its plant in Long Beach, California in mid-2009.
"These additional aircraft -- the 18 beyond the 180 -- aren't enough to sustain our supplier base and production line in the absence of a further commitment from the US government," he said.
The closure of the production line would affect some 5,500 Boeing workers at the facility.
Marcotte said some 700 suppliers had to be notified now because of a 34 month lead time required for parts.
08/18/2006 18:32 GMT