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Boeing predicts sales dip
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June 14, 1999: 7:42 a.m. ET
Aerospace giant says slowdown will cut aircraft sales by up to 40%
By Staff Writer Douglas Cameron
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PARIS (CNNfn) - Boeing said new commercial aircraft orders would fall by up to 40 percent this year as the aerospace giant prepared to announce a series of crucial deals at the Paris Air Show Monday.
Alan Mulally, president of the Seattle firm¹s aircraft operations, gave the clearest indication yet that the highly-cyclical airline industry may be headed for a slump next year.
"Orders will be only 30 to 40 percent of last year's (level), and we see them leveling out next year but are cautiously optimistic that they will come back in 2001," Mulally said.
The global economic slowdown and the fallout from the Asian crisis has forced airlines to slash orders for new aircraft as profits have tumbled. Boeing recorded 656 orders last year and has struggled in the first quarter of this year as arch-rival Airbus Industrie has claimed its prized 50 percent of market share.
Airbus said its own order book would be down this year from 556 in 1998 to around 320.
Boeing, which is still reeling from a series of production problems that delayed new aircraft deliveries as costs overran, is desperate to secure orders for the 100-seat Boeing 717 jet that it inherited from the takeover of McDonnell Douglas.
The aircraft is the last remnant of the Douglas product line following Boeing¹s decision to stop making the MD-80 series and MD-11 widebody aircraft.
Mullaly denied the 717 program was "destroying value" but the air show was filled with speculation that Boeing was offering steep discounts to keep it alive. ILFC, the world's second-largest aircraft leasing company, was understood to have been made a one-time discount offer for 50 aircraft that expires Monday.
To date, the 717 has 115 orders - including 100 from AirTran, formerly known as ValuJet.
The problems pulled Boeing into its first-ever corporate loss last year. Mulally said production had stabilized and while new orders have tailed off the company is pressing ahead with a record delivery schedule.
It delivered 148 aircraft in the first three months of this year and expects to deliver 620 for the year as a whole, beating last year's total of 564. 
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Boeing
Airbus Industrie
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