A recent softening in demand for widebody aircraft has Boeing executives re-considering planned rate increases for the 787 and 747-8 programmes and questioning the sustainability of an already slower rate on the 777.
"We're going to continue to keep a close eye on our production plans and keep supply and demand in balance," says Dennis Muilenburg, chairman, president and chief executive of Boeing.
Boeing plans to reduce monthly 777 output to an effective rate of 5.5 after 2017, as the re-engined and re-winged 777-9 enters the production system. But Boeing has accumulated only eight orders and commitments in 2016, versus a yearly target of 40 to keep the production skyline filled beyond 2017 at even the reduced rate.
"We clearly have more work to do over the next few months to hold the current 777 plans," Muilenburg says.
Even after increasing monthly output to 14, the 787 programme still has 700 aircraft in backlog and a sold-out production skyline through 2018. But Boeing also plans to further increase output to 14 787s per month near the end of the decade, as part of a wider strategy to improve profitability on each aircraft delivered and accelerate the break-even point.
That plan is still subject to change, depending on how market demand for widebodies evolves over the next year and a half, Muilenburg says.
"We've got time to do our due diligence," he says. "The principle here is to keep that supply and demand in balance."
Finally, Boeing had revealed a plan to ramp up monthly output on the 747-8 to one in 2019, doubling the slow-selling widebody's output after a planned rate decrease to 0.5 per month in September.
With the air cargo market still in a prolonged recession, Boeing has removed the plan to ramp up production of the 747-8 to one per month in 2019, Muilenbrug says. The programme remains sustainable at a rate of 0.5 per month, but Boeing still has "more work to do" to close enough deals to keep production at that rate, he adds.
Source: Cirium Dashboard
