Oil prices would have to drop far below $70 a barrel before OEMs feel any effect on demand for commercial airliners, notwithstanding speculation that precipitous price declines could discourage airlines from committing to more efficient jets at a time when replacement demand accounts for half of all orders for new airplanes, according to Boeing analysis.
Boeing CEO Jim McNerney seized the chance to impress upon securities analysts on Wednesday his confidence in the company’s ability to execute a smooth transition between production of the current 777 line and the 777X around the turn of the decade. Now delivering 8.3 of its flagship widebodies a month, Boeing expects some “feathering” of production once it approaches the point at which it fully integrates the 777X, said McNerney.
No sooner did Boeing begin evaluating bids from 22 U.S. states to build all or part of the new 777X last week when it re-entered talks with its machinists union, suddenly brightening the prospects for the incumbent, Washington state. By Thursday, however, it seemed the sides had gained little or no ground in their efforts to strike a deal for a contract extension, as union leaders quickly rejected Boeing’s most recent “best and final” offer.
Less-than-satisfactory dispatch reliability of the Boeing 787 hasn’t discouraged the company’s ambitions to ensure enough airplanes roll out of the two Dreamliner factories to meet delivery commitments. Now building 787s at a rate of seven per month, the company announced plans last week to raise rates from the 10 per month targeted for the end of this year to 12 per month by 2016 and 14 a month before the end of the decade.
Boeing will expand the capacity of its factory in Helena, Montana, by nearly 50 percent to support increased demand for commercial airplanes and new work for the Boeing 787-10 Dreamliner, company CEO Jim McNerney announced Tuesday during the Montana Jobs Summit in Butte. McNerney appeared at the event with Montana Senator Max Baucus and Governor Steve Bullock.
Boeing president and CEO Jim McNerney said he sees “a clear path” to raising 737 production rates above 42 airplanes a month as 737 Max 8s begin to supplant current-generation airplanes on its assembly lines in Renton, Washington, and its share of the market for its re-engined narrowbodies reaches equilibrium with that for Airbus’s A320neo.
With airliner order backlogs at Airbus and Boeing running to five or six years, the problem of keeping the complex global supply chain on track and in sequence is, some might say, a nice problem to have. But a problem it is, nonetheless, because while it suits the world’s dominant airframers to keep cash-yielding deliveries flowing quickly, it doesn’t necessarily follow that it suits suppliers equally well to ramp up output rates with the investment spikes this requires.
Boeing named a new head of its Commercial Airplanes unit while announcing Tuesday afternoon that Jim Albaugh has decided to retire from the company on October 1. Raymond Conner, 57, formerly Boeing Commercial Airplanes’ senior vice president of sales and customer support, assumes Albaugh’s CEO position immediately.
While far from inevitable, the proposed merger of US Airways and American Airlines seems to have garnered support from virtually everyone who matters but the management of bankrupt AA
James Bell, Boeing executive vice president, corporate president and CFO, has announced plans to retire from the company, effective April 1, 2012. Boeing’s board has elected Greg Smith, 45, corporate controller and finance vice president, to succeed Bell as executive vice president and CFO, effective Feb. 1, 2012. Boeing said the two will work together over the coming months to ensure a smooth transition.
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