Archive for Saturday, March 6, 2004

Boeing ready for $310M charge if deal fails

March 6, 2004

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— Boeing Co. still expects the government to go ahead with its suspended air-tanker contract this year but is braced to take a $310 million charge if the controversial deal is tossed out, the company said Friday.

Boeing also said in its annual report filed with the U.S. Securities and Exchange Commission that it was prepared to take a pre-tax charge of about $400 million if it scraps the 717 -- the once-popular 100-passenger plane that has seen feeble demand for years.

The aerospace giant won congressional approval last fall for a contract under which it would lease and sell 100 767 jets to the Air Force for use as refueling tankers. Those jets would be modified into tankers by Boeing in Wichita.

But the deal was put on hold amid questions about ethical issues surrounding the way Boeing pursued the deal, particularly after the company fired two senior executives for alleged improprieties during the lobbying phase.

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