If there is one aircraft type that symbolizes commercial aviation, it is Boeing’s 747. Since the first 747-100 entered service in January 1970 (see the historic video at the end of this post), the manufacturer has delivered over 1,500 747s in several variants, up to and including the current offering, the 747-8. Today we start a three-part look at the future of this iconic aircraft. (You can read Part II here, and Part III here.)
For ordinary citizens the world over, the 747’s distinctive shape made it instantly recognizable. For travelers, it changed the flying experience. Further, unlike most other commercial aircraft, it was designed, from day one, with freight in mind. In the forty-six years since the first 747-100 left the ground in Pan Am livery, over 500 747 freighters have been built or converted.
Last week, Boeing delivered its sixty-fifth 747-8 Freighter. Considering that the 747-8 entered service just five years ago, sixty-five freighter deliveries is actually an impressive total. And with orders for twenty-two more in Boeing’s backlog, one would think the manufacturer would be pleased – eighty-seven freighter orders is nothing to be unhappy about.
In fact, Boeing probably is pleased with the sales of the 747-8F. Unfortunately, though, freighter sales cannot justify a commercial aircraft program on their own, and sales of the passenger variant, the 747-8 Intercontinental, have been – there is no other way to put this – dismal. Only eighty-one units have been ordered as carriers worldwide have abandoned four-engine passenger aircraft (Airbus is not doing very well with its A380, either), and Boeing has gradually cut back the production rate of the 747-8.
Effective September, Boeing will drop to a rate of just six 747-8s per year.
Until recently, the manufacturer had said the production-rate cut was temporary. That it expected a resurgence of interest in the 747-8F in 2019, when carriers would begin replacing aging 747-400Fs (shown in the chart at right) with new -8Fs. But in late July Boeing announced it had cancelled plans to boost production back up to twelve per year beginning in 2019. Citing “anticipated weakness in the air cargo market,” Boeing reduced its demand forecast for the 747-8F and said it would take an $814 million after-tax charge against the program in its second-quarter results.
But, with the publication of those second-quarter results, came this statement about the 747 program: “If we are unable to obtain sufficient orders and/or market, production and other risks cannot be mitigated, we could record additional losses that may be material, and it is reasonably possible that we could decide to end production of the 747. [Emphasis ours]
Is a resurgence of interest in the 747-8 likely? For the passenger variant, the answer is almost certainly “no.” As mentioned above, the era of the four-engine passenger jet is effectively over – the 777-300ER replaced 747-400s and A380s on most carriers’ wish lists some time ago, and with service entry of the 777X and A35-1000 on the horizon, Boeing is not likely to see more orders for the 747-8I.
But what about the 747-8 freighter? As the 747-400F fleet ages, will carriers refleet with -8Fs? To answer that question, we start with a look at the current 747-400 freighter fleet. As shown in the chart, 244 747-400s were either built as freighters or converted to freighter configuration, and, of these, 200 are still in operation by thirty-three carriers. Some of these are relatively new, but for many, retirement is not far off, and the key question is, what will those thirty-three carriers do as operation of their 747-400s becomes uneconomical?
We will examine the 747-400 freighter replacement question on a carrier-by-carrier basis tomorrow, and we encourage you to join us at the Cargo Facts Symposium in Miami, 10 – 12 October, where senior executives from major carriers and lessors, as well as from Boeing itself, will address the question of how current trends in the air freight industry will affect future fleet needs. To register, or for more information, go to CargoFactsSymposium.com.
In the meantime, here is the original Boeing promotional video about the introduction of the 747 almost fifty years ago.
Like This Post