Boeing to focus more on Middle East

As cuts in the US defence budget loom, Boeing Co's defence unit is looking to focus more on emerging markets and to increase its investments in the Middle East. "We will absolutely be increasing our investment in this region. There are no figures that I can share, but as our business base grows in the Middle East, our investment grows," Dennis Muilenburg, CEO of Boeing's Defence Space and Security (BDS), told Gulf News in an exclusive interview on the sidelines of the Dubai Airshow. His comments come shortly after Boeing signed an agreement on Monday under which Mubadala Aerospace will become a major aircraft parts supplier. According to Muilenburg, Boeing's defence unit is increasing its focus on emerging markets. "And that's why you see the business mix changing every time. We expect to see anywhere from a $500 billion [Dh1.83 trillion] to $1 trillion defence budget reduction over the next 10 years in the US. That's a challenging situation. It's not one that's a surprise for us as we saw it coming and we are prepared for it. But our strategy includes protecting our core business in the US and then expanding internationally significantly. And that includes focusing not only on new products internationally, but also establishing partnerships around the globe," Muilenburg said. He added that the Middle East market will be absolutely "key" to the company in the wake of the US budget cuts. "We see this region and the Asia Pacific as being the two primary growth areas in our international business," he said. The move is also causing Boeing to explore newer business areas. "It's causing us to move into some less traditional areas like cybersecurity, unmanned systems and so on. So you will see some diversification in our portfolio as a result of the US defence budget pressure." Asked if BDS was expected to win some orders in the Middle East during the airshow, Muilenburg said: "Not necessarily during the airshow. But we really see broad-based defence opportunities here in the region on the defence side. For instance, there is a lot of interest in the C-17, Apache and Chinook helicopters, and then there are ongoing fighter competitions throughout the region. We also do satellite work and logistics here besides sustainment opportunities." Looking at the Boeing defence unit's overall market outside the US, Muilenburg said that five years ago, Boeing's defence business constituted about 5 per cent to 7 per cent. "Last year, it climbed to 17 per cent and by 2013, we expect it to be 25 per cent to 30 per cent."