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PARIS AIR SHOW CLOUDED BY IRAQ ROW

06 Jun 03. Top U.S. military brass, congressional representatives and U.S. industry chiefs have descended on Paris in droves during past shows, providing valuable networking opportunities for deal-seeking arms makers.

This year, lingering U.S. resentment over France’s staunch opposition to the war in Iraq has led the U.S. Defense Department to scale back sharply on its participation at the show, which dates back to 1909 and runs from June 15-22.

The Pentagon is sending only junior officers and is not allowing any U.S. aircraft to be used in the traditional daily fly-bys. Neither the U.S. Senate nor the House of Representatives are sending their traditional delegations.

Major U.S. defence contractors such as Boeing Co. (NYSE:BA – News), Lockheed Martin (NYSE:LMT – News), Raytheon (NYSE:RTN – News) and Northrop Grumman (NYSE:NOC – News) are following the government’s lead, slashing attendance levels and keeping top executives at home. Of the four arms giants, only Lockheed is sending its chief executive. Heavyweight General Dynamics (NYSE:GD – News) has scrapped its displays and plans to send only a dozen representatives.

“The major U.S. companies are reducing their delegations by about a third, with some cutting by as much as half and others not attending at all,” said Joel Johnson, vice president for international affairs at the Aerospace Industries Association.

That will give European firms a chance to steal the spotlight from their transatlantic rivals. But it will also put a major damper on a show already coloured by an unprecedented downturn in the civil aerospace market.

Although U.S. Defense Department officials deny they are punishing the French for their stand on Iraq, Washington insiders say U.S. companies have been told in private that a large presence in Paris will be frowned upon.

“The Pentagon has been actively discouraging contractors from attending the airshow,” said Loren Thompson, director of the Arlington, Virginia-based Lexington Institute. “From the administration’s viewpoint this is a relatively harmless way of expressing dissatisfaction but I don’t think U.S. industry sees it that way. They see marketing opportunities being lost, perhaps to the benefit of the French.”

Show organisers say participation, based on reserved stand space, is expected to be down roughly five percent from 2001. About 201 aircraft will be on display versus 226 two years ago, and 51 of those will take part in fly-bys, down from 66.

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