NEW YORK (CNN/Money) - Boeing Inc. lost a key order for up to 240 jets Monday to competitor Airbus Industrie, which could be a sign that the U.S. aircraft maker's production slump will extend beyond original estimates.

Shares of Boeing (BA: down $0.97 to $31.03, Research, Estimates) fell nearly 2.5 percent in midday trading on the New York Stock Exchange.

Discount carrier easyJet has placed an order for up to 240 Airbus A-319 jets, like the one shown here.

The order for 120 single-aisle jets, and an option for up to 120 more, was placed by easyJet PLC, a British discount carrier that in the past has used only Boeing aircraft. The airline said the advantages of having a single aircraft type on all its routes were outweighed by a lower price for the Airbus A-319 aircraft it decided to buy.

"At the end of the day 'low cost' companies remain 'low cost' by not wasting money," easyJet Chairman Stelios Haji-Ioannou said. "Sticking to old-fashioned fads like 'low cost airlines only fly Boeing' does not reduce costs."

Terms of the deal were not disclosed. The list price would put the value of the 120 firm orders above $6 billion, although easyJet CEO Ray Webster told CNN the purchase price would be "a lot less than that," adding that the Airbus deal would cost about 30 percent less than previous Boeing purchases.

Low cost leaders including U.S.-based Southwest Airlines (LUV: Research, Estimates) and Irish carrier RyanAir (RYAAY: Research, Estimates) have only Boeing aircraft in their fleets and on order. RyanAir's order for 100 Boeing 737-800s in January is the company's biggest order since the Sept. 11 terrorist attack. But Airbus has been making gains among some upstart discount carriers, notably JetBlue (JBLU: Research, Estimates), which uses only Airbuses.

The discount carriers are the one segment of the troubled airline industry that has shown growth while many major carriers have been cutting their capacity and purchase plans due to continued weakness in air travel demand.

The Wall Street Journal reported Monday that Boeing may cut production through at least 2004, rather than just 2003, as it previously announced. The company is set to report earnings Wednesday and may give further guidance about its plans then. The company already has warned it would miss third-quarter expectations due a charge to account for the lower prices of aircraft held by its finance unit.

"Boeing ... anticipated that airline traffic and profitability would gradually, but steadily, recover following Sept. 11, 2001," the company said at that time. "However, recent announcements by the major domestic airlines and credit rating agencies indicate that this recovery will not be as rapid as anticipated."

Analysts now expect Boeing to earn 46 cents a share in the third quarter, down from 88 cents a year earlier.

The Journal said the easyJet order could play heavily in production figures in 2004. Airbus is to begin delivery of the easyJet planes in September 2003.

The Journal quoted Alan Mulally, CEO of Boeing's commercial airplanes unit, as saying the outlook for "2004 is cloudier" than it was a few months ago and that production is "going to probably be down longer than we thought."

Last week, General Electric Co. announced that it planned to cut up to 10 percent of its aircraft engine unit staff due to continued weakness in demand.

easyJet said Airbus agreed to provide "extensive support" so there would be no additional costs to operating the A-319 rather than the Boeing 737-700 for the first two years of the agreement, and that the airline estimates that the Airbus aircraft would have a 10 percent operational saving over Boeings.