By Jon Ostrower And Doug Cameron 

Recent moves by two U.S. airlines to defer new aircraft buys and continue flying older planes haven't altered the fundamentals driving the commercial aircraft business, Boeing Co. Chief Executive Jim McNerney said Tuesday.

The sharp drop in jet fuel prices has unnerved some investors about the ability of Boeing and rival Airbus Group NV to sustain higher production rates, and though the oil benchmark has climbed in recent days, fleet planning changes by the parents of American Airlines and United Airlines added to the concerns.

"Nothing about our fundamental view of the market has changed," Mr. McNerney said in his opening remarks at Boeing's annual investor day in Chicago.

He said requests for cancellations and deferrals remained at historic lows, and pricing was steady as it targeted securing as many new orders for jets this year as it delivers, known as the book-to-build ratio.

Boosting jet production and lowering costs are central to Boeing's effort to boost profits and shareholder returns, and buybacks remain a key priority for the company, which repurchased $2.5 billion in stock during the first quarter.

Analysts have noted that moves by American Airlines Group Inc. and United Continental Holdings Inc. were likely planned long before the slide in oil prices started last summer, and included juggling orders made by previous management teams.

While Boeing's free cash flow was negative in the quarter, Mr. McNerney said cash generation was typically light at the start of the year and reiterated existing guidance.

Boeing has expanded the cost-cutting push by its commercial jet arm-- known as Partnering for Success--to 500 suppliers from 150 and boosted the target for trimming expenses at its defense arm.

The shares were recently down 0.6% at $144.02, narrowing earlier losses and in line with the early decline in the broader market.

Write to Jon Ostrower at jon.ostrower@wsj.com and Doug Cameron at doug.cameron@wsj.com

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