Mon, Feb 23, 2004
Investigation Will Slow 767 Tanker Work
The following is a statement from Boeing CEO Harry Stonecipher
to employees, amidst the Defense Department investigation into
possible conflicts of interest involved in the recently signed 767
tanker deal:
"Secretary of Defense Rumsfeld has implemented a pause in
discussions between the U.S. Air Force and Boeing on the Air Force
tanker program while a series of reviews is undertaken. It is
important that these reviews be completed so the Department of
Defense, the Congress, and the American public can have confidence
in any final decision on the 767 tanker program. The process that
the Secretary of Defense has put in place to review the tanker
program is fair and reasonable and has my full support.
"It is important that sufficient time be built into the 767
tanker program schedule to accommodate the Secretary of
Defense’s reviews. Consequently, starting on February 23,
Boeing will slow the development efforts on the Air Force 767
tanker. We will implement this slowdown in a manner that will keep
key program elements intact in the months ahead. (Production on the
Japanese and Italian tanker programs will not be affected by this
slowdown.) As we stated in our most recent quarterly earnings
report, through the end of 2003 Boeing had spent $270 million of
company money on the Air Force 767 tanker program and has been
spending approximately one million dollars per day since then.
Because important and detailed day-to-day dialogue with our
customer is necessary to refine program requirements, we do not
believe that continuing development work at the current level of
effort is prudent for either the Air Force or Boeing.
"The slowdown will result in the
releasing of approximately 100 contract employees in Wichita and
could result in layoffs of up to 50 employees in Puget Sound as
well as the redeployment of approximately 600 Boeing employees
across both sites. We deeply regret the difficulties that this
slowdown will pose for our Boeing employees and those of our
teammates.
"Further, the slowdown will cause the Air Force 767 tanker
program schedule to slip. The extent of any schedule slippage will
be based upon the date of the eventual contract award and customer
requirements.
"I am supportive of the process that the Department of Defense
has put in place and am prepared to accept the results. In the end,
I remain convinced that these reviews represent the best path
toward restoring full confidence in the program and validating the
need to get new tankers into the Air Force inventory as quickly as
possible. Boeing remains committed to the Air Force 767 tanker
program, our Air Force customer and our dedicated employees."
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