Boeing boss predicts airline bankruptcies
Boeing Company Chairman Phil Condit has said he sees major airline bankruptcies ahead as the industry copes with a crisis that could be ten times worse than the slowdown during the 1990-1991 Gulf War.Condit defended Boeing's decision to let go up to 30,000 workers from its world-leading commercial jet unit and insisted America's airways have never been safer, despite the September 11 US hijack attacks. Already Midway Airlines has gone bankrupt, followed by severe financial troubles at Swissair and Belgium's Sabena. Experts see more failures ahead in the US, despite a $15 billion government bailout package for domestic carriers. "I think we can see bankruptcies in the US airlines in the next 30 or 60 days," Condit said. "I've seen different reports and different analyses. I looked at an academic analysis that said certainly half, maybe more than half." Ticket purchases also slumped when US-led forces attacked Iraqi occupiers in Kuwait in 1991, but this slowdown will be much worse, Condit said. "At the peak, the Gulf War produced a decline of 2 per cent in traffic," Condit said. "Best guess today is that this will be five to 10 times worse than what we saw in the Gulf War." The downturn has slashed demand for jets built by Boeing and rival Airbus SAS, and Condit said this slump would be the worst or second-worst in the history of air travel, forcing layoffs at Boeing's Seattle-based jet unit.