NATO shores up future C-17 production

LONG BEACH, Calif., June 20 (UPI) -- NATO's move to coordinate acquisition of Boeing C-17 cargo planes should help Boeing's assembly plant near Los Angeles weather an upcoming dry spell.

NATO said Wednesday it was setting up a special agency to acquire and manage a C-17 fleet on behalf of 15 member nations plus Finland and Sweden as part of an effort to address airlift shortages in Europe.

"This capability will support our current operations, including in Afghanistan, and will be a pillar of the alliance's long-term transformation," NATO Secretary General Japp de Hoop Scheffer said in a statement.

The agency was formed under the 2006 Strategic Airlift Capability initiative and will acquire three or four C-17s starting next year. They, along with the Airbus A-400M aircraft, will be flown by multinational crews and used for national and European Union missions as well as NATO tasks.

While the exact timing of the NATO acquisitions was not revealed, they will likely occur at a welcome time for Boeing. The company had planned to shut down its Long Beach plant in 2009, but this week announced it would extend operations into 2010. The U.S. Air Force has been keen on expanding its current plans for C-17 buys, but will not be able to do so until after 2010 due to budget issues.

Boeing, which this week began assembly of a C-17 for the Royal Air Force, would face extensive costs associated with shutting down the production line temporarily, laying off its work force, and then ramping back up.