BOEING DISCLOSES TANKER NUMBERS WIN WOULD SECURE WORK FOR UP TO 6,000 IN EVERETT

If The Boeing Co. wins the competition to supply air-refueling tankers to the Air Force, the victory would mean employment "well into the future" for the 5,000 to 6,000 men and women who now build 767 commercial jets in Everett, the head of Boeing's military business said Sunday.

In addition, about 1,000 new Boeing military jobs in the Puget Sound area would be needed to support the tanker program.

Jim Albaugh, president and chief executive of Boeing's Integrated Defense Systems, disclosed the numbers during a talk with reporters on the eve of the Paris Air Show.

He also said he expects the company's military business in the Puget Sound area to continue to grow, which will mean more jobs, but he could not say how many. And Albaugh said the company's new 787 Dreamliner could someday be developed into a tanker.

This was the first time that a Boeing executive has ever said how many workers would be needed at the Everett plant to build tankers for the Air Force.

The figure of 5,000 to 6,000 is how many Boeing employees now work on the 767 in Everett, according to Albaugh.

A tanker win by Boeing, he said, would continue to keep the 767 work force "in place."

His comments came as a surprise because Boeing Commercial Airplanes does not publicly give out employment numbers by airplane program or even by site.

Previously, Boeing had said only that a 767 tanker for the Air Force would support about 9,000 jobs in Washington state and contribute about $400 million a year to the state's economy. Those job numbers included Boeing 767 commercial airplane workers in Everett as well as jobs with 767 suppliers in Washington.

The Air Force is expected to announce the tanker winner in the fall, probably in October.

Boeing faces competition from a team of Northrop Grumman and the European Aeronautic Defense and Space Co., the parent of Airbus.

If Boeing wins the Air Force contract, the tankers will be assembled on the same production line as the commercial jets, Mark McGraw, vice president of tanker programs for Boeing, said in a previous interview.

The tankers would be flown to Boeing's military modification center in Wichita, Kan., for installation of refueling systems and for flight testing.

Albaugh said Boeing workers in Everett would install as many military features as possible before the planes leave.

On another tanker matter, Albaugh said Boeing is making progress fixing problems with 767 tankers for Italy and Japan. Each country has ordered four.

The Italian tanker is two to three years late because of problems with the refueling pods on the wings. Albaugh said the first Italian tanker should be delivered a year from now.

About the Japanese tanker, Albaugh said there are noise problems with the onboard communications equipment. The other issue involves night operation of the remote refueling system on the 767, he said.

On the KC-135, the operator in the rear of the plane can see the refueling boom. On the 767 tanker, the operator is near the cockpit and has to monitor the refueling though a camera.

"The problems we have we understand and we will work them through," Albaugh said, adding that he expects Boeing to deliver the first tanker to the Japanese this year.

Albaugh said he does not believe that the problems will hurt Boeing in the Air Force tanker competition.

"I'd like to think that what we have gone through with the Italians and Japanese tankers are a darn good risk reduction for the U.S. offering," he said. "We have learned a lot."

The initial $40 billion Air Force contract, for 179 planes over 15 years, is likely to be only the first of two or three installments. The Air Force currently has about 550 tankers, mostly Boeing-built KC-135s, an aging platform that was based on the company's first jetliner, the 707. The Air Force also operates the bigger KC-10, made by McDonnell Douglas, which is now part of Boeing.

Albaugh said the 767 tanker being offered by Boeing, as well as the KC-30 tanker offered by the Northrop-EADS team, are both more capable than the existing Air Force tankers. That means the Air Force will likely need only about 350 to 400 new tankers to replace those 550 older planes, he said.

But that does not include the international market.

"I could easily see another 100 tankers out there," Albaugh said.

The Northrop team is offering the Air Force a tanker based on the Airbus A330-200 commercial jet. The planes for the Air Force would be assembled and modified as tankers in Mobile, Ala.

The Air Force has said it wants an operational squadron of about a dozen tankers in 2013. Whoever wins the tanker competition, however, will have a lot of flexibility in deciding how it meets that requirement.

Boeing is figuring on a tanker production rate at its Everett plant of about 15 planes a year.

The current 767 assembly line turns out about one commercial plane a month. As of June, Boeing had 59 of its commercial 767 jets left to built, 27 of them freighters ordered earlier this year by UPS.

Many military experts believe that the Air Force, when it is time to call for bids for the next batch of tankers, could want a bigger plane, such as Boeing's 777.

But Albaugh did not discount the 787 as a future tanker.

"It would make a pretty good tanker at some point in time," he said.

The Dreamliner won't enter airline service until next year. It will be the first large jetliner with a composite airframe. The 787 is designed to be as much as 20 percent more fuel efficient than other midsize jets, such as the 767 and A330.

Albaugh said developing derivatives of Boeing's jetliners for the military will be an important growth area for the company.

"Obviously we think on the horizon there are a lot of commercial derivative airplanes we can leverage the power of an integrated company to deliver on."

For example, the Navy has ordered the 737 to replace its fleet of P-3 Orion sub hunters.

And the 737 is being developed as an airborne early warning and control plane for Australia and Turkey.

Developing such aircraft could mean more Boeing jobs in the Puget Sound area, he said.

About 6,500 Integrated Defense Systems employees work in the area now, Albaugh said.

P-I aerospace reporter

James Wallace can be

reached at 206-448-8040

or jameswallace@seattlepi.com

Read his Aerospace blog at

blog.seattlepi.com/aerospace.



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