On the Record With
Lee Monson, President, Boeing Business Jets

Even valuable business tools can seem superfluous during times of economic crunch, and the manufacturers of long-range business tools such as the Boeing Business Jet are no exception.

"It's no secret that the marketplace has been incredibly soft and we have been disappointed in the results we've had this year," said Lee Monson, president, Boeing Business Jets, "but it is not unexpected given the economic uncertainty."

And Monson predicts another "tough six to 12 months," adding: "The equipment we sell is purchased out of disposable income by individuals and companies, and until things turn around people will be hesitant to spend as long as the market is unstable."

Rather that publicize what would likely be not-so-good sales figures at this year's NBAA show in Orlando, Boeing has opted to release none at all. Instead, Monson told Show News that BBJ will update its sales figures as they occur in real time on the Boeing Web site.

So what does a company do during times like these when sales are slow for $35 million "green" business jets?

"In a challenging marketplace, you get out and talk to the right people so when they are in a decision-making process you're part of that," said Monson. "We've not scaled back our sales and marketing."

At the same time, Monson said BBJ is placing "increased focus" on military and government opportunities.

In late June, the first BBJ for the Royal Australian Air Force (RAAF) was shown publicly in Australia, and the Canberra-based Air Force 34 Squadron will operate two BBJs under a lease managed by Qantas Defence Services. BBJ will also provide four firm and three option aircraft to Australia's airborne early warning and control "Wedgetail" program, with the first scheduled to go into service in 2006.

In addition to the Australian government, the government of South Africa will begin operating a BBJ later this year. The U.S. Air Force will put its first C-40B, based on the BBJ, into service this fall. And the U.S. Navy operates a C-40A, which is based on the same platform as the BBJ, a Boeing 737-700.

A bright spot for the BBJ organization over the past year has been international sales, according to Monson, who added that about 60 percent of all BBJ sales occur outside the United States.

"Our biggest area of opportunity still lies in the Mid-East, not just in the Gulf but also European operators with ties to that part of the world,"

A sale this summer to Airbus operator Rafik Khalifa, an entrepreneur and financier with business interests in Africa and Europe, was particularly sweet. The BBJ for Khalifa had been previously announced as a delivery for another customer, and had just been completed by Jet Aviation. Boeing Capital was responsible for arranging the new deal with Khalifa.

"We're excited that Khalifa stepped up to a BBJ," said Monson. "When compared to the Airbus product [our airplane] was a 6,000-mile airplane with eight fuel tanks and a soundproofing package that made it very quiet."

In the area of technology development, the BBJ organization is closely watching development of the Connexion by Boeing high-speed data product for commercial aviation, with an eye to applying it to the business market. And the next Boeing Technology Demonstrator aircraft will be a BBJ, according to Monson, who said the aircraft will focus on technologies such as surface guidance, enhanced vision and satellite approaches -- -all technologies that Monson expects to find application in the BBJ in the near future.

By Barry Rosenberg