By Helen Jung
The Associated Press

SEATTLE - Boeing Co. has hosted a contest to nickname its proposed 7E7 airplane, set off a bidding war among communities wanting to build the jet and announced work assignments for its worldwide partners in the project.

But Boeing hasn't said it will actually build the plane. With the airline industry struggling and Boeing having scrapped plans for two major jets in recent years, the 7E7 isn't a done deal.

As the buzz surrounding the 7E7 gets louder, Boeing's board of directors faces a big, expensive decision: either build the plane or risk losing the company's credibility as a commercial jet maker - and potentially cede the future of commercial jets to archrival Airbus.

"The board almost has no choice," said Richard Aboulafia, an aviation analyst with consulting firm Teal Group. "They're set up for embarrassment if they don't. ... Face is involved here. Politics is involved here."

Boeing is particularly vulnerable to bad publicity at the moment, Aboulafia noted. The company has been hurt by ethical scandals that culminated in the dismissals last month of two executives for alleged misconduct. Then on Dec. 1, Boeing chief executive Phil Condit resigned to help the company distance itself from the "controversies and distractions" of the previous year, particularly accusations surrounding a $21 billion deal for Boeing to provide 767 jets as tankers to the Air Force.

Boeing, Aboulafia said, needs to re-establish itself as a company committed to aerospace, not "taxpayer leeches."

Credibility is not all that's at stake, said Michel Merluzeau, principal analyst with New York-based market research firm Frost and Sullivan.

"Boeing will not be a player in the commercial aircraft market if this project does not go ahead," he said.

Boeing's board will have to approve two decisions before the 7E7 is a go. In mid-December, it will consider whether to offer the new airplane for sale to airlines. Then, depending upon the results of those sales efforts, the board would decide next year whether to formally launch the 7E7 program.

Boeing declined to make board members available for interviews. But new CEO Harry Stonecipher says he supports the program.

Boeing spokesman John Dern said that, as with previous jet programs, the company is looking for the right plane at the right time.

"The fact is that there is lots of confidence that the 7E7 is on the right track given all the developments in the market," Dern said in an e-mail. "Ultimately, however, it will be the business case and the associated analysis that drive final decisions."

For decades, Boeing's jetliners were the company's prime moneymaker. Its aircraft, from the workhorse 737s and 757s to the widebody 767s, 777s, and jumbo 747s, are global icons of America's technology and manufacturing prowess.

But since the Sept. 11, 2001, terror attacks, Boeing's defense division now brings in more revenue than commercial airplanes. Boeing has expanded its space, communications and other businesses as well.

The company has not launched an all-new plane program since its 777 jet in 1990. Meanwhile, rival Airbus expects to eclipse Boeing this year as the world's largest commercial jet manufacturer in terms of deliveries and is developing the new superjumbo A380 for service in 2006.

Boeing had considered an extensively updated and larger 747 jumbo jet, dubbed the 747X, but shelved it in 2001. Boeing then seized on the idea for a new plane that would travel near the speed of sound, the Sonic Cruiser, but abandoned that project at the end of 2002.

Now, it's the 7E7, proposed as a super fuel-efficient jet to replace the 757 and 767 with greater range to handle long-distance, point-to-point routes.

Boeing has highlighted the 7E7 in multiple speeches and promotions.

The company started a nationwide competition for locating a final assembly plant. States put together incentive-laden proposals in an effort to land the plant and its 800 to 1,200 jobs. Boeing is expected to select a site next month. A report in Friday's Seattle Times said Boeing executives will recommend that the 7E7 be built in Everett.