London ? The 30,000 workers that are being laid off by Chicago-based Boeing Co. may never be recalled, a company executive said Sunday.

In a briefing on the eve of the Farnborough International Air Show, the first meeting of the world’s aviation industry in the wake of the Sept. 11 attacks, Alan Mulally, the president and chief executive of Boeing Commercial Airplanes, said the company in the future would produce more airplanes with fewer workers.

He said he did not know if next year’s planned production level of 275 to 300 airplanes would have to be adjusted if the threat of terrorism does not abate and the economy and the nation’s airlines do not rebound in 2003.

Mulally’s comments come at a crucial time for Boeing, which earlier this month opened negotiations with the International Association of Machinists and Aerospace Workers, which represents thousands of Boeing production workers. The contract with workers expires Sept. 1.

‘Misleading’ priorities

Mulally, a graduate of Kansas University, insisted that his saying that 30,000 furloughed workers might never return would not derail contract talks. Crucial issues for the union are job security and rehiring the furloughed workers.

“The union is absolutely aligned and attuned with the same thing,” he said. “What we decide together has got to help Boeing be more competitive going forward. Because if we don’t come out of this by making progress, we will hurt everyone.”

Frank Larkin, a spokesman for the machinists union, said it is “misleading to suggest that protecting laid-off workers is not a top priority of (union) negotiators.”

“The members just voted 98 percent to strike if their demands are not met, and job security is at the top of that list,” Larkin said.

Staffing matches economy

In the last 40 years, employment at Boeing, which has production facilities in virtually every state across the country, has soared in good times and plunged whenever a recession has struck the country.

Boeing currently employs 173,000 people, of which about 70,000 work for the company’s Seattle commercial airplane division.

Less than a month after the Sept. 11 attacks, Boeing announced it would lay off 30,000 workers to reduce costs as it rescheduled deliveries of 300 airplanes that the nation’s airlines suddenly didn’t need. So far it has laid off about 25,000 and is on track to lay off the remainder by the end of the year.

Some 5,000 workers in Wichita have been affected by the cuts.

“It costs the airlines and it costs Boeing a lot (of money) to have these wide swings in production. We think we should consciously try to keep the production of new planes in a narrower range 350 to 500 airplanes per year,” he said.

Production of Boeing aircraft soared in the 1990s as airlines around the world rushed to put new airplanes into service to handle the rapidly expanding numbers of travelers.

But in the wake of the attacks, air travel has slumped. In response, airlines have parked nearly 2,000 airplanes at desert storage facilities in California and Arizona.

“How many planes are we going make in 2004, in 2005? I don’t know,” Mulally said. “This (slump) is lower and deeper in coming back than we have ever seen.”

Slow recovery expected

Boeing has said it plans to make 275 to 300 planes in 2003. Airbus, Boeing’s European competitor, says it plans to make about 300 planes.

“If we came back slowly, we could continue to improve our productivity, and we wouldn’t be adding a lot of employees,” he said. “We’re not going to be asking everyone to come back right away. Let it be a market-driven thing, not a Boeing thing.”

While a slower recovery will permit Boeing to continue refining its production plans, Mulally said he did not know how to calculate the effect of another year of losses by the country’s largest airlines.

Wall Street analysts are estimating that the nation’s airlines will lose $5.5 billion this year, a slight improvement from the 2001 loss of $7.2 billion. Most are saying that only the discount carriers Southwest, JetBlue, Airtran and American Trans Air will be profitable in 2003.

Another year of airline losses could alter Boeing’s plans.

“It will be a slower recovery. But does that mean you go down (in production)? Who knows?” said Mulally.

Last year, Airbus, the European commercial aircraft manufacturer, shocked Boeing by announcing an order for 155 jets by a long-time Boeing customer. Boeing’s stock fell 5 percent on the announcement.