Boeing CEO shrugs off share price fall

The Boeing 787 Dreamliner aircraft is surrounded by employees and special guests during its world premiere outside the Boeing assembly plant in Everett, Washington, July 8, 2007.

FARNBOROUGH (Reuters) - Boeing Co's (BA.N) chief executive shrugged off the dramatic fall in the plane maker's share price from its all-time high last year, saying the drop was characteristic of companies vulnerable to the soaring price of oil.

"A lot of energy-sensitive stocks have had a tough go, on top of the general market trend," Boeing CEO Jim McNerney told Reuters at the Farnborough Airshow on Tuesday. "It's been tough for a lot of us."

Boeing's stock has tumbled 41 percent from its all-time high last July, as concerns over its delayed 787 Dreamliner and the prospect of dwindling orders from ailing airlines has worried investors. The price of crude oil has doubled in that time.

That is a much sharper fall than the Standard & Poor's 500 index .SPX, which is down about 22 percent from its all-time high in October last year.

Boeing's stock was trading up slightly at $63.45 on the New York Stock Exchange on Tuesday, below the $66 close the day before McNerney took over as Boeing's CEO just over three years ago.

BIG PURCHASES

The plane maker and defense company has so far announced more than $13 billion worth of commercial aircraft plane orders at the Farnborough Airshow, a favorite place for airlines to make a splash with big purchases, although most of that was already accounted for in Boeing's order book, attributed to unidentified customers.

However, Air China (601111.SS) made a surprise announcement in China that it would buy 15 of Boeing's large 777 airplanes and 30 of its single-aisle 737s, worth $6.3 billion at list prices.

The purchase by China's flag carrier is one of the biggest plane orders from the country on record.

"We don't try to hoard orders for Farnborough or the Paris air show," McNerney said. "They fall as they fall."

Boeing will use its 767 airliner as the basis for its entry into the re-run of the U.S. Air Force's $35 billion aerial refueling tanker competition, McNerney said, as long as the requirements for the aircraft are not changed.

The Pentagon is restarting the competition for the tanker contract, handed to Northrop Grumman Corp (NOC.N) and EADS (EAD.PA) earlier this year, after the U.S. Government Accountability Office (GAO) found the award unfairly favored Northrop/EADS' larger plane.

The Air Force has not yet issued its requirements for the re-run of the tender.

"Our customer (the U.S. Air Force) has said that the requirements will not change, although the findings of the GAO will be taken into account," said McNerney. "Based on that, we think it will be the 767."

The alternative for Boeing would be a tanker based on its 777 line of planes, which is larger than both the 767 and the Airbus A330, which the Northrop/EADS tanker is based on.

(Reporting by Bill Rigby; Editing by David Holmes)