More 747-8 production cuts possible: Boeing supplier

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A Boeing supplier has warned that 747-8 production rates could drop again by another roughly three aircraft per year.

Ronald Saks, chief executive of Aircraft structures supplier LMI Aerospace, told analysts on 10 May that the recent slowdown of the 747-8 production rate to 1.75 per month from two might not be the end of the reductions.

"In talking with the Boeing people last month, that topic was dicussed and the feeling was it probably will not go below 1.5 per month. That's the best intelligence we have right now," Saks said on LMI's first quarter earnings teleconference.

Orders for the 747-8 Freighter and passenger-carrying 747-8I have stalled on depressed trading in the air cargo sector. Global freight tonne kilometers declined 2.3% year-on-year in March, reversing increases reported in January. The sector's performance has baffled some analysts who expect to see growth in air cargo in line with economic growth.

"It's been unusual for cargo traffic to continue to decline as overall commerce has seemingly been doing somewhat better," Saks said.

On 2 May, Dubai Aerospace Enterprises (DAE) cancelled an order for five 747-8Fs, removing the last of 15 such aircraft from its original orderbook.

Boeing slowed annual output of the updated freighter and passenger aircraft from 24 to 21 on 22 April, citing weak demand in the air cargo market. Boeing said then that it still expects a rebound in the air cargo market in 2014.

"We're in active discussions with a lot of different airlines for campaigns," Boeing says.