Boeing plans for DoD budget cuts

Thursday - 4/14/2011, 10:40am EDT

Dennis Muilenburg, President and CEO, Defense, Space and Security Business Unit, Boeing

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By Suzanne Kubota
Senior Internet Editor
FederalNewsRadio.com

Defense contractors are watching the budget debates carefully. Many lawmakers advocate cutting Defense spending as part of any 2012 deficit-cutting budget.

Dennis Muilenburg, the president and CEO of Boeing Defense, Space and Security, told Federal News Radio, "this isn't a surprising situation for us. We've seen this coming for a few years and we've been preparing for it."

Muilenburg said with flat to possibly declining Defense budgets expected over the next few years combined with declining budgets in Europe, "all of that has told us that we need to continue to diversify our business." While Boeing is growing core business, said Muilenburg, it's also looking at adjacent markets like cybersecurity and trying to grow more internationally.

Boeing's cyber business model is still evolving, but Muilenburg said the basic idea is to stay flexible. The company is investing in some leading edge technology and "that includes cloud computing centers, but to us it's very important that we have secure infrastructure, that we can operate with our global supply chains and that we ensure we're providing those very secure products to our customers."

We know our customers are facing some tough budget challenges and so we're taking a hard look at our operations top to bottom, streamlining our operations, reducing overhead costs, and that reduction in overhead costs is allowing us to continue to invest in the future of our business. That includes innovation investments as well as investments in small business.

For more from Dennis Muilenburg on Boeing's Air Force Tanker program and a discussion of the company's role in the SBInet program, click on the audio player at the top of the page.

This story is part of Federal News Radio's daily DoD Report. For more defense news, click here.