Boeing CEO doesn’t expect upturn until 2005

? Plane orders announced at last week’s Paris Air Show don’t make Boeing Co.’s Chief Executive Philip Condit more optimistic about the state of the aviation market.

“For the most part, those were very long-term orders,” Condit said, while attending the World Economic Forum conference in Jordan.”The market is going to come back. There’s no question in my mind that that’s going to happen. But I wouldn’t try to read near-term market outlook from those orders.”

Boeing’s commercial aircraft production next year will be similar to production this year, with a slight upturn in 2005 being “the best we could probably do,” Condit said.

In Paris, Alan Mulally, chief executive of Boeing’s Commercial Airplanes unit, said the company expects to deliver about 280 aircraft this year and 275 to 300 in 2004. Boeing delivered 527 planes in 2001 and 381 planes in 2002.

Asked about deals in the pipeline, Condit replied: “Right now, I think we’re in a real pause, because Asia was the one strong part for commercial aviation and SARS has clearly changed that picture. Until that clarifies, I don’t think we’ll see a lot happening.”

SARS is severe acute respiratory syndrome, a sickness that hurt the travel business when it spread through Asia this year.

Revenue growth in military sales will be more robust, topping 10 percent next year, Condit said.

Condit also said there’s a high probability Boeing’s board will decide to go ahead with its planned fuel-efficient plane, the 7E7. The board decision likely will be made late this year, with firm orders expected next year, he said.

Chicago-based Boeing is looking at Europe for merger potentials, and at Britain’s BAE Systems within that broader context. But no merger talks with BAE or other European companies are ongoing, he said.

Condit and other U.S. airline executives missed the Paris Air Show, though he denied any U.S. government pressure to boycott it over France’s failure to back Washington on the Iraq war.

“With the airline market down, with the reduced U.S. government presence there, in terms of best use of my time, I decided I didn’t need to be there,” he said.

Condit expects economic growth in the Mideast and the rebuilding of Iraq to generate more aircraft orders from the region. He estimated that talks on rebuilding Iraqi Airways’ fleet wouldn’t start for a year or so.

Although resentment of the United States over the war in Iraq remains high in the region, Condit said he didn’t think that would affect business.

“In Boeing’s case we see very little that would indicate to me that there are decisions being affected by the political environment,” he said.

The better showing of European aircraft maker Airbus in recent competition for United Arab Emirates and Qatar orders “fit the pattern,” he said.

“The emirates ordered from both Boeing and Airbus, and we have the earlier deliveries in that set, so I’m not at all worried about that one,” he said. “Qatar has been dominantly Airbus, and they went that direction.”

Boeing shares closed at $34.46, down $1.07, or 3 percent, Monday on the New York Stock Exchange.

Boeing is the Kansas’ largest private employer with 12,000 employees at its Wichita plant.