Boeing to end production of C-17 Globemaster III in 2015

Boeing will complete production of the C-17 Globemaster III and close the C-17 final assembly facility in Long Beach, California in 2015.

"Ending C-17 production was a very difficult but necessary decision," Dennis Muilenburg, president and chief executive officer of Boeing Defense, Space & Security said.

"We want to thank the highly skilled and talented employees who have built this great airlifter for more than two decades – and those who will help us as we continue to build the remaining 22 aircraft and support and modernise the global fleet for decades to come. The C-17 remains the world’s most capable airlifter with unmatched readiness and cost effectiveness."

Boeing will continue after-delivery support of the worldwide C-17 fleet as part of the C-17 Globemaster III Integrated Sustainment Program (GISP) Performance-Based Logistics agreement. The GISP "virtual fleet" arrangement provides the highest airlift mission-capable rate at one of the lowest costs per flying hour.

"Our customers around the world face very tough budget environments. While the desire for the C-17's capabilities is high, budgets cannot support additional purchases in the timing required to keep the production line open," Muilenburg added.

"What's more, here in the US the sequestration situation has created significant planning difficulties for our customers and the entire aerospace industry.  Such uncertainty forces difficult decisions like this C-17 line closure. We will continue to make tough but necessary decisions to drive affordability and preserve our ability to invest for the future."

Boeing expects a charge of less than $100 million, which will be recorded this quarter, as a result of this announcement. The charge will not impact financial guidance for the year.