Aviation News, Boeing, Airbus

The damage was discovered before the aircraft - the standard workhorse of many short-haul American fleets - were delivered to airlines. Boeing has also launched its own internal investigation and stepped up security at its plants, though it has stopped short of saying that the damage was definitely caused deliberately.

Sandy Angers, a spokeswoman for Boeing, said that nothing like that had ever happened before. She said the company would not describe the incidents as “sabotage” unless there was clear evidence. “It’s a really strong word and we’re saying `suspicious wire damage’,” she said.

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Tampering with an aircraft is a crime under US federal law, but whether that law would apply was not clear, because the aircraft were still in the factory at Renton, near the company’s Seattle headquarters. Boeing is moving its head office to Chicago later this year, but will retain its manufacturing facilities in Washington State.

A spokesman for the company’s biggest trade union, the International Association of Machinists and Aerospace Workers (IAM), said it was concerned over the incidents. “Machinist union members at Boeing have always and continue to take great pride in building the highest-quality aircraft in the world,” he said.

The company said the decision reflects higher launch costs and weakened demand for both its launches and its satellite-making business. Chief executive Phil Condit, explaining the decision to analysts on a conference call, cited a “terrible marketplace” along with some technology and performance problems.

Boeing will now focus exclusively on the U.S. military as a customer for its Delta IV satellite launches, which will significantly raise its costs.

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The announcement culminates several years of struggles at Boeing’s California-based satellite operations, the weak link in its expanding and otherwise prosperous defense and space business.

It also reflects another notable setback for a company that has relied on its defense and space operations to enable it to steer profitably through the turbulent commercial airplane environment since the 2001 terrorist attacks.

Besides the air travel slump, Boeing has been struggling with a difficult satellite market since it acquired the satellite-making holdings of Hughes Electronics Corp. in October 2000.

Boeing shares were down $1.14, or 3.3 percent, to close at $33.44 on the New York Stock Exchange.

“It’s just a very, very weak market, and Boeing way overestimated the commercial use that would have been if the satellite business hadn’t gone down the tube,” said Paul Nisbet, an analyst for JSA Research.

There were only three commercial satellite orders worldwide last year that were large enough to justify a Delta IV launch, he said.