Graham Warwick/WASHINGTON DC
Boeing expects to deliver 60 fewer aircraft, mainly 747s and 777s, to Asian airlines over the next three years, because of the region's economic downturn.
The revised forecast implies the near-term cancellation or deferral of orders in hand from Asian airlines, but the company has yet to see any "outright cancellations", says Boeing Commercial Airplane Group president Ron Woodard.
Boeing has not revised its overall delivery forecast downward, stresses president Harry Stonecipher. The company expects that aircraft no longer required by Asian airlines will find homes in other regions. "Demand in other parts of the world is still robust, and we are confident we can retain high production rates," he says.
Stonecipher says that Boeing has more than 300 aircraft on order which are scheduled for delivery to Asian airlines between 1998 and 2000 - "one-fifth of our total production", he says. Most narrowbody-aircraft deliveries will be to China, so far unaffected by the region's economic crisis. Widebody deliveries are most at risk and, while Boeing expects Asian airlines to take scheduled 1998 deliveries, Stonecipher acknowledges that the 747 and 777 are "most vulnerable" in 1999 and 2000.
Boeing sees a bright side to the Asian downturn, in that aircraft could become available for early delivery to other customers. The company has no 747 delivery slots available before mid-2000. "There is US and European demand for the 747 we cannot meet," says Woodard. Stonecipher, meanwhile, sees an opportunity in the downturn to ease Boeing's production problems.
Woodard says that the company is ahead of schedule on its production-recovery plan. Total parts shortages are down to 1,555, 375 below plan; while total jobs behind schedule are down to 18,100, some 6,900 below plan. Boeing chairman Phil Condit says that the combined 737, 747, 757, 767 and 777 production rate will reach 43 a month in the second quarter and stay there, although the ability to go to higher rates will be "protected".
Boeing tendered 336 Seattle-built 7-series aircraft for delivery in 1997, and plans to deliver a total of 550 in 1998, including Douglas Products division aircraft assembled at Long Beach, California. Condit expects deliveries in 1999 "to be relatively stable, in the 550-plus range".
The Asian crisis could affect plans for growth versions of the 747 and 777, Woodard says. Asian airlines form a large part of the potential demand for 747 and 777 derivatives. "We continue to discuss possible configurations with customers," he says, but the Asian downturn "-could influence" decisions. "We will not launch until we have customers," he stresses.
Source: Flight International
