From the announcement:
Jim McNerney
The 747-8 is producing at two airplanes per month, with 10 deliveries in the fourth quarter and 31 for the year. Customer satisfaction with the airplane’s performance remains high, as it has set a new industry standard for efficiency. We remain focused on improving production processes and program profitability while closely monitoring the softness in the cargo market.
From the QA:
Samuel J. Pearlstein - Wells Fargo Securities
If I could change gears from the 87 to just the 47, if I just look at that, it seems like for a wide body airplane, it’s going to take a lot longer in terms of configuration. I’m wondering, do you need to make a decision soon about 2014 rates, given a backlog of 67 airplanes? How do you sustain that at two per month?
Greg Smith
Well, the pipeline is pretty good. We are mindful that there is softness in the cargo market. So we are getting volume the old fashioned way on this program right now, which is finding customers, working with them. We’re very fortunate that the economics of this airplane, particularly in the cargo market, are very, very compelling. So notwithstanding a difficult market situation, as we sit here today we have confidence that we’re going to be able to hold rate.
But we’re going to be taking a look at it every quarter. But right now we have a good pipeline of folks that we’re working with that gives us confidence that we can hold rate. When that changes, we’ll discuss it.
Kind of underwhelming, at first read. I was hoping for a little more juice. This announcement seems much more reserved about the prospects of the plane compared to previous announcements.
Jim McNerney
The 747-8 is producing at two airplanes per month, with 10 deliveries in the fourth quarter and 31 for the year. Customer satisfaction with the airplane’s performance remains high, as it has set a new industry standard for efficiency. We remain focused on improving production processes and program profitability while closely monitoring the softness in the cargo market.
From the QA:
Samuel J. Pearlstein - Wells Fargo Securities
If I could change gears from the 87 to just the 47, if I just look at that, it seems like for a wide body airplane, it’s going to take a lot longer in terms of configuration. I’m wondering, do you need to make a decision soon about 2014 rates, given a backlog of 67 airplanes? How do you sustain that at two per month?
Greg Smith
Well, the pipeline is pretty good. We are mindful that there is softness in the cargo market. So we are getting volume the old fashioned way on this program right now, which is finding customers, working with them. We’re very fortunate that the economics of this airplane, particularly in the cargo market, are very, very compelling. So notwithstanding a difficult market situation, as we sit here today we have confidence that we’re going to be able to hold rate.
But we’re going to be taking a look at it every quarter. But right now we have a good pipeline of folks that we’re working with that gives us confidence that we can hold rate. When that changes, we’ll discuss it.
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Kind of underwhelming, at first read. I was hoping for a little more juice. This announcement seems much more reserved about the prospects of the plane compared to previous announcements.
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