December 2004/January 2005
Volume 03, Issue 8
Welcome to the Middle East, the birthplace of three of the world's most influential religionsand a region where technological advances are taking place. Boeing is working here to build relationships and expand business.
BY MAUREEN JENKINs
The Middle East is a region of strategic global interest, one whose oil reserves fuel economies, industries and lifestyles across the globe. It's an area rich in cultural history, yet today is rapidly evolving, as the latest technological advances enable its businesses to keep pace with the rest of the industrialized world. The birthplace of three of the world's most influential religions, it also finds itself in the midst of some of the world's most complex geopolitical challenges.
But along with challenges come opportunities for Boeing. The Middle East is one of the world's fastest growing commercial airplane markets, and its countries' defense needs are rapidly expanding. Boeing is committed not only to expanding its business footprint in this region, but also to teaming with countries such as Saudi Arabia and the United Arab Emirates in meeting their needs for jobs and technological development. Not only do such partnerships help contribute to Boeing's bottom line, but because of the Middle East's global strategic importance, its countries' success helps ensure a more stable world.
Moving people across the globe (BCA)
About 70 percent of Boeing Commercial Airplanes' sales come from outside the United Statesand the business unit considers the Middle East especially key. Consider, for example, the fact that Dubai International Airportthe region's largest and a major transportation hublast year reported 13 percent growth in passenger traffic. The facility's ongoing multibillion dollar construction project is a testament to its success. It's projected that by 2010, 60 million passengers are expected to pass through its gates. And Dubai-based Emirates' order of up to 13 777-300ERs, announced during the Farnborough International Airshow in July, is yet another indication of the growth happening here.
"When you're looking at the end of a resource extraction economy," said Teal Group analyst Richard Aboulafia of Dubai's reduced dependence on oil income, "you look for a service economysomething that leverages educated manpowerand then you look at your natural resources. Of course, you've got weather, so you might attract people if you build sun and sand places. Geography is on their side, too."
Defense begins at home (IDS)
Partnering with Middle Eastern countries to stabilize their military forces is a priority for Boeing. So in addition to the Boeing-built products it services in the Middle East, Integrated Defense Systems is taking a proactive approach to building upon its already strong relationships and sales in the region.
New IDS business potential is huge, with about $6 billion in sales a realistic possibility over the next five years, said Marcus Hurley, IDS vice president of business development for the Middle East. Long-term, the figure reaches as high as $18 billion. That doesn't even address potential new sales in Homeland Security and network-centric operations, which Hurley estimates could be worth $22 billion. "If you can have confidence that you have got the right knowledge here and link it back to the United States," he said, "you've got a more secure world."
Helping connect the region (Connexion)
A region with increasing numbers of travelers and rapidly growing airlines that fly long-distance routes is a natural fit for Connexion by Boeing, the real-time, high-speed Internet, data and entertainment service. This spring, the business unit visited the Middle East to demonstrate its capabilities to potential commercial and VIP jet customers, government and regulatory officials, and reporters. Connexion representatives took the demo aircraft, Connexion One, to Dubai, United Arab Emirates and the nations of Qatar and Bahraineven receiving an e-mail from Harry Stonecipher, who shared his excitement about the service's potential.
"The response from everyone that came on the airplane and experienced the service was overwhelmingly positive," said Mike Woodward, Connexion's regional director for Europe and the Middle East. Airlines here, just as in other regions of the world, are "able to immediately recognize the potential value for passengers as well as airlines themselves," he said.
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