Aerospace and defense giant Boeing Co. (BA) said Friday that it will boost production rates for its two major commercial jet programs, the 777 and 747, citing increasing customer demand in the recovering airplane market.
The Chicago, Illinois-based company said that the 777 program's accelerated rate increase to seven airplanes per month from five per month will begin in mid-2011 instead of early 2012, six months earlier than previously planned. The 777 seats more than 300 people.
Meanwhile, the 747 program's planned production rate increase to two airplanes per month from 1.5 per month will start in mid-2012 instead of mid-2013. The 747-8, the newest version of Boeing's iconic jumbo jet, has been plagued by production problems. The passenger version, which can carry more than 400 people, is scheduled to be delivered in late 2011.
Boeing noted that suppliers for both the 777 and 747 will be prepared to support the accelerated rate increases.
The company said that the accelerated production is not expected to have a material impact on its financial results for fiscal year 2010. The company will provide a complete guidance update when it releases first-quarter financial results.
Boeing's announcement underscores the recovery in the airplane market as airlines have become more willing to shell out large sums of cash to buy the company's aircraft. Most major airlines reported losses in 2009 as travel demand slumped.
Soft demand for air travel and freight services last year reduced airlines' purchases of new aircraft leading to a decline in orders as well as cancellations. This, in turn, negatively impacted the revenues of aircraft makers such as Boeing. The recession that ended last year and high unemployment have shaken the travel industry, but there are signs of a turnaround.
Jim Albaugh, Boeing Commercial Airplanes President and CEO said, "Market improvement and our conservatively managed approach to production have put us in a position where we see it necessary to raise aircraft output. Increasing our rate is the right thing to do to support our customers."
Randy Tinseth, vice president of Marketing for Boeing Commercial Airplanes, said, "We see 2010 as the year of overall economic recovery within the industry and 2011 a year where airlines return to profitability. As a result, we anticipate an increase in demand for airplanes in 2012 and beyond."
In early March, Airbus manufacturer European Aeronautic Defense and Space Co. (EADSY.PK,EADSF.PK) said it will increase the monthly production rate for its single-aisle A320 family of aircraft from the current rate of 34 to 36, starting December 2010. The company added that the production rate for the long-range A330/A340 will be maintained at the current level of eight per month. According to EADS, the decision to raise its single-aisle production rate was driven by the continuing demand for its aircraft and a record backlog in excess of some 2,300 A320 Family aircraft.
On February 8, Boeing announced that the 747-8 Freighter, the largest commercial jet ever built by the company, successfully completed its first flight. The first flight was a year later than originally planned by the company. The newest 747 model, 250 feet long, is about eighteen feet longer than the existing 747-400 Freighter and provides customers with 16% more revenue cargo volume compared with the predecessor. Deliveries of the aircraft are slated to begin sometime in fourth quarter of 2010, more than a year late.
While reporting its financial results for the fourth quarter in late January, Boeing said that Commercial Airplanes' delivery guidance for fiscal year 2010 has been set at between 460 and 465 airplanes, reflecting fewer twin-aisle deliveries, and is sold out. It includes the first few 787 and 747-8 deliveries, which are expected to begin in the fourth quarter. This compares to aircraft deliveries of 481 during 2009.
In Friday's regular trading session, BA is trading at $71.60, up $0.73 or 1.03% on a volume of 5.96 million shares. In the past 52 weeks, the stock has been trading in a range of $32.54-$73.30.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.