Boeing Sees Orders Reviving Late 2003

DUBAI – U.S. plane maker Boeing Co on Sunday predicted no revival in civil aircraft orders for two years, with those sales flowing into stronger deliveries in 2004.

The September 11 attacks in the United States had cost global aviation about one year's growth, which translated into about 800 excess aircraft, Boeing executive vice president for sales Seddik Belyamani told Reuters in an interview.

``It is going to take all of 2002 to get back to the traffic level we were at,'' said Belyamani, the company's chief airliner sales executive. ``It is going to take all of 2003 for the airlines to be profitable again.''

``(So) I expect airlines to start ordering airplanes by the end of 2003,'' he said at the Dubai air show.

Stronger deliveries would follow in the following year.

The attacks have frightened many people away from flying. Airlines have responded by slashing schedules, grounding old planes and seeking to defer delivery of new ones from Boeing and its European rival, EADS affiliate Airbus SAS.

The number of aircraft ordered depends on the number that airlines need to meet growth in traffic and to replace obsolete units in the global fleet of around 15,000.

As Belyamani described it, traffic will not return to its September 10 level for a year -- which means that the growth that had been expected in that year, around five percent, will be lost. Five percent lost traffic implies five percent surplus capacity, the 800 planes that Belyamani mentioned.

STILL AIMING FOR 2001 ORDER TARGET

Boeing and Airbus have responded to the crisis by slashing plans for 2002 deliveries.

But Belyamani still hoped to reach his long-standing 2001 sales target.

``My target is 400,'' he said. ``It is hard but I am not giving up.''

The company has booked sales of about 270 planes so far this year, not including an intended order for 25 wide-body 777s that Dubai's Emirates announced on Sunday. Such intended orders, legally only memorandums of understanding, usually become definitive contracts after a few months.

``There is still China,'' Belyamani said, eyeing his next sale. ``We are still hoping we can do another China deal.''

Boeing signed a sale of 20 narrow-body 737-800s and two 747-400 freighters with China Southern Airlines Co Ltd. on October 4.

BOEING LESS PESSIMISTIC

No one really knows yet how badly the September 11 attacks have damaged the airline and therefore civil aerospace industries, and executives have been closely watching traffic figures for signs of a recovery.

Belyamani said Boeing's view had tended to become less pessimistic in the eight weeks since the attacks.

``It is not as bad (now),'' he said.

His opportunity to sell new planes will depend a lot on how many old grounded planes are scrapped -- ``turned into beer cans,'' in the language of the industry.

Most speculation has focused on whether fuel- and labor-inefficient planes from the 1960s and 1970s would return to service.

``I think there is a very good chance that they will not,'' Belyamani said. Like his Airbus opposite number, John Leahy, he also thought the more modern MD-80 aircraft, of which more than 1,100 have been in service, might also become less numerous.

Analysts tend to be less optimistic and regard most of the old planes and especially the McDonnell Douglas MD-80s as serviceable equipment which, even if grounded, will find its way back into service somewhere, although perhaps not with major carriers.