The decision was based on "continued bipartisan congressional support and increasing signs that the U.S. Air Force has requirements for 30 additional C-17s," a Boeing executive said.
The Air Force has been constrained by a congressional mandate that it also upgrade aging C-5 cargo planes. The Pentagon is weighing whether the upgrades are worth the cost, but the study is not expected to be completed until 2010, or after the C-17 line was scheduled to be shuttered.
"We believe they've bought enough time that we can bridge over," Wynne told the Dow Jones news service in Paris.
The plane, a workhorse that has transported troops, supplies and casualties in Afghanistan and Iraq, has been in production since the early 1990s. The program has been one of Boeing's largest, generating about $3 billion in annual sales.
Also on Tuesday, Boeing's commercial aircraft division received a major boost as Century City-based International Lease Finance Corp., the world's largest airline leasing company, ordered 63 passenger jets, including 50 787 Dreamliners.
The Dreamliner, which has yet to be flown, is assembled in Seattle.
At list prices, the deal is potentially worth $8.8 billion, though the leasing company is likely to have paid far less because of discounts often given to large purchasers.
Boeing is to announce whether it will close its Long Beach assembly line, ending an era of aircraft production in Southern California.
Employees at the center will provide engineering support and solve technical problems for airlines worldwide that fly Boeing jetliners.
Boeing delivered the 717s to two airlines: AirTran Airways and Midwest Airlines, the largest 717 customers.
The contract to replace the half-century-old KC-135 tanker fleet.