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30,000 Boeing jobs gone forever?

By David Bowermaster
Seattle Times aerospace reporter

	TIM OCKENDEN / THE ASSOCIATED PRESS
	As spectators look on, a Boeing C-17 transport plane touches down Monday at the Farnborough Air Show in England. Organizers expect 300,000 people and 1,200 exhibitors to attend the weeklong event.

LONDON — Unless the economy and the airline industry quickly come back to life, the 30,000 workers Boeing is laying off this year will not get their jobs back soon, if ever.

"We're not going to be asking everybody to come back right away no matter what, because it's the market that's not coming back," said Alan Mulally, chief executive of Boeing Commercial Airplanes.

Mulally spoke yesterday on the eve of the Farnborough Air Show in Boeing's sixth-floor suite at the Dorchester Hotel in London.

The charismatic leader of the commercial-aircraft unit based in the Puget Sound area expanded upon recent comments by him and Chairman Phil Condit that Boeing might not build the proposed Sonic Cruiser, a high-speed aircraft that would fly just below the speed of sound.

And Mulally suggested European rival Airbus is endangering the airline and aerospace industry by not following Boeing's lead and significantly lowering its aircraft deliveries in 2002 and 2003. Earlier in the weekend, Airbus said it is Boeing that should be further cutting production and employment.

Airbus expects to deliver 300 aircraft in this year and next, down from 325 last year. Boeing forecasts 380 deliveries this year and 275-300 next year, down from 527 last year.

In his most emphatic language yet, Mulally said Boeing must become more efficient if it hopes to survive and prosper in the increasingly intense competition with Airbus.

That means producing more airplanes with a smaller company. The effort will not end with this year's layoffs.

"Every year, forever, we're going to improve our quality and productivity. That means we can do more with fewer resources. Not just people," he said.

Anticipating complaints that Boeing is acting callously, Mulally said the company's motivation is to secure the livelihood of the 70,000 workers that remain.

"When I'm with employees, we celebrate this," Mulally said. "It means we get to keep the jobs we have. And it's OK for Boeing to be more productive."

He acknowledged that the issue of jobs is a "lightning rod," particularly because Boeing will soon enter contract negotiations with its two largest unions, the International Association of Machinists (IAM) and the Society for Professional Engineering Employees in Aerospace (SPEEA).

But he expressed optimism that union leaders share Boeing's goals and strategy.

"I have never seen such thoughtful conversations about the importance of improving the quality and productivity at Boeing as an absolute, fundamental key strategy for our competitiveness and us staying in business. And the union is absolutely aligned and in tune with the same thing," he said.

Mark Blondin, president of the IAM, and Bill Dugovich, SPEEA spokesman, did not return calls seeking comment.

Turning to the Sonic Cruiser, Mulally for the first time said Boeing could opt for a small, 60- to 70-passenger version, rather than a 250-seater to replace the slow-selling 767.

The outcome will depend on the value passengers place on speed.

"Are there large enough numbers of people who will pay to justify an airplane that big? Or would it maybe actually start with segmenting the service with smaller airplanes?" Mulally said.

A preview could come Wednesday, when Mulally said Walt Gillette, program manager of the Sonic Cruiser, will present a variety of configurations under study.

Echoing comments by Chairman Condit last week, Mulally said Boeing is also considering a more conventional replacement of the 767 that would be dramatically cheaper to build and operate than today's aircraft.

"You cannot only use the technology for efficiency and speed, but you can also make the airplane less expensively," he said.

Mulally saved his most heated comments for Airbus. Boeing quickly announced plans to cut 30,000 jobs and halve aircraft production after Sept. 11, Mulally said, because the company did not want to increase the financial burden on struggling airlines by forcing them to take planes they did not need.

"Following 9/11, we have rescheduled 300 airplanes to support the airlines as our production went down," Mulally said.

"It's just amazing to me that a member of our industry can keep putting out airplanes when the airlines don't need airplanes," he continued.

"We stepped up and made the hard decisions to reduce our production to support our industry, and its just amazing to us that our competitor would not. And we don't know why."

On Saturday, Airbus Chief Operating Officer Gustav Humbert said Boeing will have roughly 20,000 more full-time workers than Airbus even after Boeing's layoffs are concluded.

Consequently, he charged, Boeing is making extreme price reductions to land new aircraft sales so it can keep its revenues up.

"(Boeing) has the capacity over there to make 500 aircraft," Humbert said. "They are really trying desperately to further increase their volume to cover their costs."

The war of words is sure to escalate as both manufacturers spend this week in the glare of the Farnborough spotlight.

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