Bernie Dunn, President of Boeing Middle East, North Africa and Turkey - Courtesy of Aerospace Summit official Twitter
CAIRO – 27 May 2018: Between over $730 billion worth of airplane orders during the next 20 years and the opportunities opening up due to the increased commercialization of EgyptAir, Boeing sees the Middle East, and Egypt in particular, as a prime slot in its global business – both from a commercial and a defence side.
Boeing’s business in Egypt dates back to 1966 when EgyptAir first ordered three Boeing 707 aircrafts. Since then, the airline has ordered some 53 aircrafts from Boeing, with the commercial aerospace industry leader, who has delivered the competition six years in a row, looking to become an integral part of the expansions in the aerospace industry that it predicts will become in Egypt.
Boeing’s most up-to-date outlook reveals the importance of the Middle East to Boeing and predicts that the region will buy 3,350 new airplanes over the next 20 years. It further estimates that the commercial services market in the region will record more than $109 billion during the next 10 years; the operating tempo and age of military aircraft in the Middle East are also expected to warrant some $90 billion investment in services within the same timeframe. Given that the Middle East is Boeing’s fourth largest services growth market, after the United States, Europe and Asia Pacific, and that three of the company’s top 10 buyers already located within the region, Boeing is looking to become an integral part of the expansion that it predicts.
With the wind back in EgyptAir’s sail, and forecasts for expansion, Bernie Dun, President of Boeing Middle East, North Africa and Turkey talks to Egypt Today about their partnership with Cairo University, the importance of the Egyptian market and the role the company plans to play in the Middle East over the next 20 years.
ET: Let me start by asking you a question around Boeing’s partnership with Cairo University; can you tell us more about it?
Dunn: In all markets that we consider important, which is almost everywhere that we work, we try to give something back to the community. There is a lot of ways that we can do that but one of the ways with selected markets is that we form a partnership with one or more universities.
We started the relationship with Cairo University last year based on an assessment of what it is doing in the engineering and aeronautical area, and we sponsored a student project. We provided a grant that sustained student engineering projects in the area of aerospace. Kids building planes basically, flyable planes; and we are doing it again this year. And I think that the university appreciates it and that it allows them to do things that they are not able to do for lack of funding. And we are going to continue to do that.
I was at the exhibition last year with the kids models, they grouped up into teams and they had a day when they displayed their projects and it was really gratifying; these kids were so enthusiastic about what they were doing. And they were really enjoying Boeing’s involvement; Boeing helped them out and provided some expertise. So, we are going to continue [this program].
We are also going to look at Alexandria University because I had the opportunity to take my boss and to meet President Sisi a month ago, and he mentioned to us Alexandria University, which has won a major international prize in the United States. So, we are going to go up there—we have already reached out to them—and we want to go up and develop a relationship with Alexandria University as well. Maybe there are ways that we can collaborate; maybe we can help the young people of Egypt in some way by collaborating. This is what the university relationships are all about; [partnerships] are targeted around aeronautics, aerospace engineering and related sectors.
ET: So, do the students have the opportunity to join Boeing?
Dunn: Not in that project, but there are other ways that we get kids to the United States.
When we get involved in manufacturing, for example, typically there are trips and also there are a business internship programs and we take selected kids—about four or five of them every year—and we send them back to Seattle for six months of essentially working as if they are Boeing employees in certain areas.
We are still at the beginning stages with Egypt right now but all of these things can eventually be possible with Egypt as well. We are really putting a lot of emphasis on this market because this market is important to us.
ET: Why is the Egyptian market important? What potential does the market have?
Dunn: We [Boeing] are the majority of the airplanes in EgyptAir and we are seeing a new visions and a new leadership at EgyptAir that appears to be getting increasingly commercial.
Let me put this into perspective for you; this is an emerging market and the airline has not been that active over the years, it has been kind of a plotting airline, a state-run airline. Now, we are seeing a lot of energy and a lot of commercial-minded actions in the airline; I think it is going to really expand and we want to be part of that expansion. We are finding opportunities now that we did not have before; so, I see good things coming for Boeing and the Egyptian market, and we will return that with community engagement and trying to give something back as well.
Egypt has great opportunities to invest in various fields within the aerospace industry; given the long history of cooperation between Boeing and EgyptAir, as well as other major institutions within Egypt, Boeing is looking forward to investing in Egypt.
ET: Turning to the Middle East, Boeing works with many airlines, like Emirates and Etihad, and is expected to have some 4,000 aircrafts in the region by 2036. What are your comments on this?
Dunn: Currently, We have about 700 aircrafts positioned in this region right now; I am not sure if that counts Turkey or not, Turkey would maybe be another 150 probably; we have nearly the similar amount on back loan to this region.
Our present market outlook predicts about 3,350 new planes in the region in the next 20 years, which translates to 63,000 new pilots, 67,000 new technicians and about 92,000 new cabin crew members; so, there are a lot of jobs coming.
Governments in the region have really learnt that if you make an investment in your aerospace sector, you are really making an investment in your whole economy because those high-tech people that I just mentioned demand good places to live—somebody has got to built them; they demand nice schools for their kids—somebody has got to built them and they are going to need teachers. They need good hospitals, good healthcare. They also require places to spend their money; restaurants, entertainment, and so on. All that builds an ecosystem.
If this region buys 3,350 new airplanes in the next 20 years, which it will, somebody will be those pilots and technicians and everything else. We hope that it will be the Egyptians and Saudis and Emiratis, and so, we are trying our best to prepare the grounds for success all the way around.
ET: The U.S. has recently withdrawn from the Iran agreement, how will this impact Boeing?
Dunn: We were involved in negotiations with Iran Air and as I mentioned to CNBC about two weeks ago in Bahrain when I was asked by the correspondent, “So, Trump pulled out of the Iran agreements; what does that do to your business?” The U.S. pulling out of the Iran deal does not affect [Boeing’s] business because we never booked that opportunity as an order and we never built it into our production pipeline for 777 and 737.
We viewed it as an opportunity that might happen; if it did, great; if it didn’t; then, it does not affect us whatsoever.
And you know, beyond that we are taking the lead of the U.S. government on the Iran issue but it is out there of course and I think eventually these problems are going to get solved, but for now we are taking the lead of the U.S. government. But this did not affect our production schedule in any way.