Company - - Feb 10,2017
According to Boeing’s CEO, the company must essentially sell more 777 and 787 jetliners to maintain the production plans on the right path.
The latest order from high-profile customer Singapore Airlines which landed on Thursday is worth $13.8 billion.
According to analysts, it is seen as a strong endorsement of both planes and could surge sales in a lazy market if other carriers trail Singapore Air's lead.
On Thursday, Chief Executive Officer Dennis Muilenburg said at a conference in New York that sales of Boeing's highly profitable 777s have decelerated so much that the aircraft manufacturer is cutting production 40 percent this year to manage as it begins transferring to the successor 777X model which Singapore Airlines has ordered.
Muilenburg further added Boeing must also sell more 787s so that it can proceed with plans to improve output to 14 planes a month in the next few years from the current count of 12.
Boeing shares were recorded to rise 0.4 percent at $164.42 during afternoon trading.
The recent Singapore Air order is a boost for the 787 assembly line, but does not aid the slow 777 sales, as the order is concerned with the newer 777X model.
Boeing has already trimmed 777 output to 7 planes a month from the previous figure of 8.3, and will further cut it to 5 a month in August. Moreover, deliveries will actually drop to about 3.5 a month as Boeing forms 777X test planes in the coming few years.
However, even with these reductions, the aircraft maker has to sell a few more 777s to complete production this year and has 10 percent of the assembly unsold in 2018 and 2019.