Stonecipher: With Airbus Blessing
GE-Honeywell Could Go Through

Boeing vice-chairman Harry Stonecipher says GE's acquisition of Honeywell stands a chance now that Airbus has publicly endorsed the deal.

On the eve of the Paris Air Show, European Commission regulators made demands on GE the company said were unacceptable. That prompted Stonecipher to accuse the European airplane maker of having actively opposed the consolidation. Airbus, in turn, maintained that it supported the consolidation and its chief, Noel Forgeard, said he felt "poisoned" by the Boeing executive's comments.

If Forgeard felt offended, "Then I apologize," Stonecipher said yesterday during a press briefing.

"I can applaud" Airbus's position that it supports the GE/Honeywell tie-up, he said. "I have to accept that [statement] at face value." But he was still critical that Airbus didn't openly state its support earlier, noting that Boeing's support was given within 24 hours.

But the shrewd Stonecipher, a former GE executive, seemed pleased by the turn of events. In fact, he indicated that now, when the European Commission issues its ruling on the transaction July 12, it may actually let it go through. Stonecipher insisted he wasn't trying to provoke an Airbus statement to affect these developments.

Focusing on Boeing, Stonecipher kept to his message of trying to grow the company. Making his last major air show appearance before his planned retirement next May, he said he expects Boeing to establish several new businesses over the next five years along the lines of Boeing Connexion, the air traffic management business, and its capital organization. Those three divisions are supposed to generate much of Boeing's growth. For instance, the capital business has a 30% growth target, the ATM business will compete for a $6 billion to $10 billion market, and Connexion expects to generate $4 billion to $5 billion within ten years, in a market that should support three players.

Stonecipher also said Boeing is on track to move its headquarters from Seattle to Chicago in early September. Some 400 to 500 staff will be based in Chicago, of which about 200 employees are expected to relocate, with the rest to be hired locally.

Focusing on the highest profile program the company has been discussing here, Stonecipher stressed that Airbus criticisms of the Sonic Cruiser's environmental performance were largely inaccurate. He said the aircraft will be quieter than other airliners because of its delta wing design. The high lift-over-drag will allow almost to glide into an airfield, Alan Mulally, president of Boeing Commercial Aircraft added. Furthermore, Stonecipher dismissed Airbus's claim that the A380 will have 35% lower emissions. The Airbus number is measured on a per-seat basis, he said, which puts the approximately 300-seat Sonic Cruiser at a huge disadvantage compared to the 550-seat A380.