A State Department for Boeing

By BRYAN CORLISS

Herald writer

SEATTLE – Boeing has hired a former U.S. ambassador to Russia and the United Nations to bolster the company’s overseas presence.

Thomas Pickering, now undersecretary of state for political affairs, will join Boeing in January after completing his duties for the Clinton adminstration, Boeing Chairman and Chief Executive Officer Phil Condit said Wednesday.

“What we’re asking Tom to do is form a State Department for Boeing,” Condit said. “We need to bring greater focus to our global presence. … He will help take our global vision for the company to a new level.”

Pickering’s title will be senior vice president for international relations. He will report to Condit and will become a member of the company’s senior leadership team.

Boeing needs to focus more on international issues, Condit said. The company has customers in 145 countries and operates in 60, he noted.

Pickering has been a diplomat for five decades. He has been U.S. ambassador to India, Israel, El Salvador, Nigeria and Jordan, as well as the nation’s official representative at the United Nations and in Russia.

He was a Fulbright Scholar and holds two master’s degrees and 11 honorary doctorate of law degrees. And he speaks five languages other than English – French, Spanish, Swahili, Arabic and Hebrew.

“He’s a very impressive guy,” Condit said.

Condit announced Pickering’s hiring during a year-end briefing for reporters at Boeing headquarters.

It was an impressive year for the company, Condit said.

The commercial airplane group is on track for 600 orders this year and will deliver about 490 planes, he said. The group, at the end of this year’s third quarter, had orders for $123 billion worth of airplanes, which was $12 billion greater than the total for all of 1999, he said.

“We’re virtually sold out through 2001,” Condit said.

The group is pushing profit margins higher, he said, from 5.5 percent in 1999 to 7.3 percent during the first nine months of 2000.

“Commercial Airplanes is poised to operate at double-digit margins significantly sooner than we thought was possible,” Condit said.

Boeing will continue to push for new space business in 2001, Condit said. The company estimates there is about $90 billion a year to be made in the sector – right now Boeing has 4 percent of that market.

“We’ve got a lot of room to grow,” he said. And with Pickering’s hiring, “Now we can open new frontiers globally.”

In other business, Condit:

Noted the 40-day strike by the Society of Professional Engineering Employees in Aerospace as one of the year’s setbacks. “A strike is never a desired outcome,” he said. The two sides reached a settlement, but still don’t necessarily see eye-to-eye, Condit said. “There clearly remain issues, and I’d argue there will remain issues,” he said. “They tend to be complex and multidimensional.” However, joint engineer-management teams are in place to discuss them, he said.

Predicted employment levels will remain stable during 2001. “I can see some ups and downs, but nothing big.”

Said he is confident in the company’s response to Airbus’ drive to launch its A3XX superjumbo jet. Airbus is close to the 50 orders for the A3XX needed to launch the project, but Boeing this year received orders for 115 777s, Condit noted. That reinforces Boeing’s view that the market is evolving toward larger fleets of 200- to 300-passenger planes, rather than the 550-seat-plus superjumbo, he said.

At the same time, Boeing is likely to launch its proposed 747X soon to compete with Airbus’ superjumbo.

“There’s a lot of interest,” particularly in a cargo version of the craft, he said.

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