In the midst of dismal job-cut news, Boeing Company (BA: 64.00 +0.96 +1.52%)can bring in some joy in Minnesota by creating new jobs. Boeing will be able to bring happiness to 230 individuals and it will cost the company $11 million, if its NewGen Tanker is selected as the U.S. Air Force’s next aerial refueling aircraft. The Air Force is expected to award this contract later this year.Boeing’s NewGen Tanker with its latest and advanced technology will enable the Air Force to transport fuel, cargo, passengers and patients. Moreover, the new tanker can act as a replacement for 179 KC-135 aircraft. The NewGen Tankers are more cost-effective than the larger tankers and will consume 24% less aviation fuel than its competitors.
Some of the Minnesota manufacturers have agreed to join hands with Boeing for the New Tanker project. The manufacturers will help the company to prepare important components like main landing gear door uplocks, Air Data Inertial Navigation System, environmental control systems, angle of attack systems, ice detection systems and temperature sensors.
We believe Boeing’s ability to create new jobs is positive news, compared to its peer Northrop Grumman Corporation (NOC: 55.36 -0.16 -0.29%). Northrop has decided to lay off some of its employees citing delay in receiving government orders. However, the possibility of Pentagon going by its previously announced plan to trim costs in the tune of $100 billion within the next five years can impact the future prospects of Boeing.
Based in Chicago, Boeing Company designs and produces commercial airplanes, defense systems and civil and defense space systems. The major competitors of the company are General Dynamics Corp. (GD: 59.49 +0.48 +0.81%),Lockheed Martin Corporation (LMT: 75.005 -0.145 -0.19%) and Northrop Grumman Corporation. We retain a Neutral rating and have a Zacks Rank #3 on Boeing.
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