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Boeing's 2007 Order Book  
User currently offlineT773ER From United States of America, joined Dec 2006, 278 posts, RR: 0
Posted (7 years 9 months 3 weeks 10 hours ago) and read 6588 times:

After two consecutive years of very strong sales, I would see no reason why that trend would not continue into the coming year for Boeing. While the numbers may not be in the range of 900-1000, but more like 500-700.

I don't think that number is impossible to get either. We may see some US legacy carriers ordering, and that will boost the number too.

Does anyone know the record for best sales in consecutive years?


"Fixed fortifications are monuments to the stupidity of man."
31 replies: All unread, showing first 25:
 
User currently offlineNAV20 From Australia, joined Nov 2003, 9909 posts, RR: 36
Reply 1, posted (7 years 9 months 3 weeks 10 hours ago) and read 6514 times:

Quoting T773ER (Thread starter):
I would see no reason why that trend would not continue into the coming year for Boeing. While the numbers may not be in the range of 900-1000, but more like 500-700.

I think that Boeing will find itself facing some big strategic decisions in 2007. It's pretty clear that they will again be close to achieving around 1,000 firm orders in 2006. But they will only have delivered around 400 (total so far this year 364):-

http://active.boeing.com/commercial/...ReportType=CurYrDelv&pageid=m15520

What's more, orders received are spread evenly across their whole product range. Boeing must be close to the point where they have four or five years' production of ALL their models sewn up in firm orders. They have already said that they have declined orders for 737s because they could not meet the early delivery dates required by the customers concerned.

So my guess is that, as you say, the number of Boeing orders taken next year will be substantially less than for this year - but for the reason that Boeing simply do not have the production slots available to meet the demand.

That leaves Boeing with three choices:-

1. Leave production at present levels and just allow the scarcity of production slots to 'bid up' prices.

2. Build more production capacity (e.g. a second 787 line). That would involve huge commercial risks, due to the high capital cost and also the need to hire large numbers of extra people.

3. Explore the possibility of recruiting other firms to build Boeings under licence.

No indications as yet as to which of those three options they will choose.



"Once you have flown, you will walk the earth with your eyes turned skywards.." - Leonardo da Vinci
User currently offlineAirlineAddict From United States of America, joined Jan 2005, 419 posts, RR: 1
Reply 2, posted (7 years 9 months 3 weeks 6 hours ago) and read 6301 times:
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Quoting NAV20 (Reply 1):
1. Leave production at present levels and just allow the scarcity of production slots to 'bid up' prices.

Ironically, it's exactly what many of their customers are trying to do by limiting seat capcity.

Quoting NAV20 (Reply 1):
3. Explore the possibility of recruiting other firms to build Boeings under licence.

This is the most interesting... does CNAC have any desires for an A320 AND 737 line?


User currently offlineOsiris30 From Barbados, joined Sep 2006, 3192 posts, RR: 25
Reply 3, posted (7 years 9 months 3 weeks 6 hours ago) and read 6276 times:

Quoting NAV20 (Reply 1):
3. Explore the possibility of recruiting other firms to build Boeings under licence.

This makes the most strategic sense and kills two birds with one stone depending on who the subcontractor is. Say they sub out to LM to build 737s, it keeps LM on the sideslines that much longer. (Note I don't have any inside info, just using LM as an example)

Quoting T773ER (Thread starter):
While the numbers may not be in the range of 900-1000, but more like 500-700.

I actually think next year will be even better... CX, BA, AA all need to place orders soon..



I don't care what you think of my opinion. It's my opinion, so have a nice day :)
User currently offlineN328KF From United States of America, joined May 2004, 6489 posts, RR: 3
Reply 4, posted (7 years 9 months 3 weeks 5 hours ago) and read 6169 times:

Quoting AirlineAddict (Reply 2):
This is the most interesting... does CNAC have any desires for an A320 AND 737 line?

If Boeing had to add another 737 line, I would bet that they would do it with Wichita.

That being said, people here have said that there are two 737 lines...but what about the DoD line? Doesn't that make three?



When they call the roll in the Senate, the Senators do not know whether to answer 'Present' or 'Not guilty.' T.Roosevelt
User currently offlineAlexchao From United States of America, joined Aug 2001, 688 posts, RR: 0
Reply 5, posted (7 years 9 months 3 weeks 4 hours ago) and read 6121 times:

Quoting NAV20 (Reply 1):
2. Build more production capacity (e.g. a second 787 line). That would involve huge commercial risks, due to the high capital cost and also the need to hire large numbers of extra people.

Even if Boeing can justify the need for an additional 787 line, can their suppliers keep up with the increased production rate?


User currently offlineZvezda From Lithuania, joined Aug 2004, 10511 posts, RR: 64
Reply 6, posted (7 years 9 months 3 weeks 3 hours ago) and read 6050 times:

Quoting T773ER (Thread starter):
After two consecutive years of very strong sales, I would see no reason why that trend would not continue into the coming year for Boeing.

The reason, as given above, is that production is 400 frames/year. The backlog is already about five years for all models. Airlines are less willing to order airliners for delivery in the distant future then in the near future.


User currently offlineMnik101 From United States of America, joined May 2006, 173 posts, RR: 0
Reply 7, posted (7 years 9 months 2 weeks 6 days 21 hours ago) and read 5783 times:

Why won't Boeing open a 737 line in Long Beach? They still run the C-17 line and they all ready have the facility. All they need to do is to re tool the old 717 lin for the 737.

User currently offlineNAV20 From Australia, joined Nov 2003, 9909 posts, RR: 36
Reply 8, posted (7 years 9 months 2 weeks 6 days 21 hours ago) and read 5745 times:

Quoting Mnik101 (Reply 7):
Why won't Boeing open a 737 line in Long Beach?

They may well consider that, Mnik101. But in the end, business is about profit, not 'world domination.'

There's no particular advantage in just 'getting more orders,' if the result is that you have to invest untold further billions in satisfying them. The trick is to aim to win just enough orders to keep production going full blast without having to spend big to jack up capacity in the short term.

That way lies 'high margins at less risk.'



"Once you have flown, you will walk the earth with your eyes turned skywards.." - Leonardo da Vinci
User currently offline11Bravo From United States of America, joined Feb 2005, 1720 posts, RR: 10
Reply 9, posted (7 years 9 months 2 weeks 6 days 20 hours ago) and read 5685 times:

Quoting Mnik101 (Reply 7):
Why won't Boeing open a 737 line in Long Beach?

Money.

First, southern California is a very expensive place to operate a production facility. If, and I think that's a very big if, Boeing were to build a second B737 facility, it would almost certainly be located elsewhere. Everything is more expensive in SoCal; labor, utilities, transportation, etc.

Second, Boeing isn't going to invest billions to build facilities to fill the current demand unless there is an absolute certainty that those new production levels are sustainable over time. What will be the production demand in 10 years? How about 20 or 30 years?

Both Airbus and Boeing need to be careful here and resist the temptation to significantly increase production capacity unless they are very, very sure it's sustainable in the longer run.



WhaleJets Rule!
User currently offlineMrComet From Ireland, joined Mar 2005, 559 posts, RR: 8
Reply 10, posted (7 years 9 months 2 weeks 6 days 20 hours ago) and read 5648 times:

I think its clear from the huge backlogs and the orders of the A330 and 767 747 that many sales are being made by availability. That means both Boeing and Airbus need to have more lines on future products. This appears to be the case as I bet Boeing wishes they could have arranged for suppliers to have contingency plans in place for increasing production on the 787. This is a very cyclical industry and the ability to provide products quickly is becoming more important. If the two could immediately provide any customer who wanted one any airplanes in any of their lines, they would sell some airplanes today.

The same way Boeing worked hard to reduce the timeframe to design, build and certify an airplane, they need to work to have flexibility on production rates. It may cost $1 billion to set up a new line but one order for one airline will pay for that. I'd say Airbus is ahead of them on that.

The key will be in the new 737/A320. I wouldn't be surprised if they designed for rates of 70 per month or more.



The dude abides
User currently offlineTrex8 From United States of America, joined Nov 2002, 4774 posts, RR: 14
Reply 11, posted (7 years 9 months 2 weeks 6 days 20 hours ago) and read 5616 times:
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Quoting NAV20 (Reply 8):
There's no particular advantage in just 'getting more orders,' if the result is that you have to invest untold further billions in satisfying them. The trick is to aim to win just enough orders to keep production going full blast without having to spend big to jack up capacity in the short term.

a lesson they learned the hard way almost 10 years ago


User currently offline11Bravo From United States of America, joined Feb 2005, 1720 posts, RR: 10
Reply 12, posted (7 years 9 months 2 weeks 6 days 19 hours ago) and read 5558 times:

Quoting MrComet (Reply 10):
It may cost $1 billion to set up a new line but one order for one airline will pay for that.

I would be very surprised, completely shocked actually, to learn that a billion dollars profit is realised from any one order. I suspect you would have to sell many hundreds of aircraft to produce a profit for your shareholders AND pay for a new $1 billion facility.



WhaleJets Rule!
User currently offlineTrex8 From United States of America, joined Nov 2002, 4774 posts, RR: 14
Reply 13, posted (7 years 9 months 2 weeks 6 days 19 hours ago) and read 5536 times:
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plus its not just Boeing who have to come up with the capital but many suppliers who may not be able to do so

User currently offlineAtmx2000 From United States of America, joined Oct 2004, 4576 posts, RR: 37
Reply 14, posted (7 years 9 months 2 weeks 6 days 19 hours ago) and read 5481 times:

Quoting Zvezda (Reply 6):
The reason, as given above, is that production is 400 frames/year. The backlog is already about five years for all models. Airlines are less willing to order airliners for delivery in the distant future then in the near future.

Which really makes you wonder about the A350 orders, with EIS being 7 years away. At least with the old A350 proposal from 2005, EIS would have been 5 years away in 2010. How can you plan to take aircraft so far in the future?



ConcordeBoy is a twin supremacist!! He supports quadicide!!
User currently offlineTrex8 From United States of America, joined Nov 2002, 4774 posts, RR: 14
Reply 15, posted (7 years 9 months 2 weeks 6 days 18 hours ago) and read 5416 times:
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Quoting Atmx2000 (Reply 14):
How can you plan to take aircraft so far in the future?

that would certainly inject a degree of uncertainty into things but if you have aircraft of a certain age you can foresee when they may need replacement, exactly how many you may need given possible growth may be a more nebulous factor. its only a little less uncertain than making a firm order for say delivery in 2 years and having options out to 10 years.


User currently offlineDAYflyer From United States of America, joined Sep 2004, 3807 posts, RR: 3
Reply 16, posted (7 years 9 months 2 weeks 6 days 16 hours ago) and read 5306 times:

Quoting NAV20 (Reply 1):
So my guess is that, as you say, the number of Boeing orders taken next year will be substantially less than for this year - but for the reason that Boeing simply do not have the production slots available to meet the demand.

That leaves Boeing with three choices:-

1. Leave production at present levels and just allow the scarcity of production slots to 'bid up' prices.

2. Build more production capacity (e.g. a second 787 line). That would involve huge commercial risks, due to the high capital cost and also the need to hire large numbers of extra people.

3. Explore the possibility of recruiting other firms to build Boeings under licence.

No indications as yet as to which of those three options they will choose.

Thats exactly what I was thinking. I hope the go for option 2 on both the 737 lines and the 787 line.



One Nation Under God
User currently offlineT773ER From United States of America, joined Dec 2006, 278 posts, RR: 0
Reply 17, posted (7 years 9 months 2 weeks 6 days 15 hours ago) and read 5014 times:

I would be very supprised if Boeing were to hire a another firm to make the 737. With the smaller profits coming from the 737, hiring out work to just to ramp up production would cut into those profits even more.


"Fixed fortifications are monuments to the stupidity of man."
User currently offlineFuturecaptain From , joined Dec 1969, posts, RR:
Reply 18, posted (7 years 9 months 2 weeks 6 days 13 hours ago) and read 4582 times:

I think Boeing is smart keeping production around where it is. They can still turn up the speed on the moving lines if suppliers can keep up and that will increase production without the expense of a new line.
With the current backlog there are firm orders to be built, and cashflow coming in, that can carry the company over through Y1 and Y3 development. Perhaps when Y1 is developed it will be on 2 production lines from the start as we can expect the NG narrowbody to sell in the thousands over many years.

I agree that Boeing needs to be careful here and resist the temptation to up production to the point of building a whole new line for the current product line-up.


User currently offlineLumberton From United States of America, joined Jul 2005, 4708 posts, RR: 20
Reply 19, posted (7 years 9 months 2 weeks 6 days 12 hours ago) and read 4220 times:

Quoting NAV20 (Reply 1):
3. Explore the possibility of recruiting other firms to build Boeings under licence.



Quoting Osiris30 (Reply 3):
Say they sub out to LM to build 737s, it keeps LM on the sideslines that much longer. (Note I don't have any inside info, just using LM as an example)

I actually started a thread several months back proposing a joint venture between BCA and LM on the 737 successor. It fizzled out and the idea met with a less than warm response here. Personally, I think NAV20 may be on to something WRT the existing 737. However...

Wouldn't this be a good idea for Boeing to talk about expanding production and get a quid pro quo from its unions along the lines of a 10 year contract or something in order to guarantee labor peace? I've long felt that the 787 program would eventually get a second production line and that by locating it in Japan might "strike proof" the Dreamliner. But I'm coming around to the view that the way forward might be offering the union some serious job security? Then expand production....

[Edited 2006-12-16 23:09:48]


"When all is said and done, more will be said than done".
User currently offlineEBJ1248650 From United States of America, joined Jun 2005, 1932 posts, RR: 1
Reply 20, posted (7 years 9 months 2 weeks 6 days 11 hours ago) and read 3892 times:

Quoting Mnik101 (Reply 7):
Why won't Boeing open a 737 line in Long Beach? They still run the C-17 line and they all ready have the facility. All they need to do is to re tool the old 717 lin for the 737.

How about using the line where the MD-90s were built?



Dare to dream; dream big!
User currently offlineDEVILFISH From Philippines, joined Jan 2006, 4853 posts, RR: 1
Reply 21, posted (7 years 9 months 2 weeks 6 days 11 hours ago) and read 3764 times:

Quoting 11Bravo (Reply 9):
Money.

First, southern California is a very expensive place to operate a production facility.



Quoting EBJ1248650 (Reply 20):
How about using the line where the MD-90s were built?

As they have just disposed of the Torrance facility, considering that Boeing is also intending to unload the Long Beach property, proceeds that could be realized from its sale might have already been earmarked for other capital intensive development projects - control of which their managers and bean counters possibly couldn't wait to have.

http://www.boeing.com/news/releases/2006/q4/061207e_nr.html



"Everyone is entitled to my opinion." - Garfield
User currently offlineFuturecaptain From , joined Dec 1969, posts, RR:
Reply 22, posted (7 years 9 months 2 weeks 6 days 4 hours ago) and read 3536 times:

Quoting Lumberton (Reply 19):
by locating it in Japan might "strike proof" the Dreamliner

Nah, they should locate it in Toulouse.  Smile  stirthepot 


User currently offlineCobra27 From Slovenia, joined May 2001, 1016 posts, RR: 0
Reply 23, posted (7 years 9 months 2 weeks 6 days ago) and read 3451 times:

Nince reply, knowledgable

Quoting NAV20 (Reply 1):
That would involve huge commercial risks, due to the high capital cost and also the need to hire large numbers of extra people.

No, actually it wouldn't be, there is already around 500 orders to be fullfilled. That can be done with only 1 line, but in years . Airlines want their plane delivered as soon as possible. I don't think that they pay employees around 1 million dollars a month.

2 things seem strange:
1. why hasn't second line been confirmed yet (orders are throgh the roof)
2. there ihaven't launched the 787-10 yet


User currently offlineMrComet From Ireland, joined Mar 2005, 559 posts, RR: 8
Reply 24, posted (7 years 9 months 2 weeks 5 days 22 hours ago) and read 3406 times:

Quoting NAV20 (Reply 8):
There's no particular advantage in just 'getting more orders,' if the result is that you have to invest untold further billions in satisfying them. The trick is to aim to win just enough orders to keep production going full blast without having to spend big to jack up capacity in the short term.

As long as you are at least breaking even there is not problem. The advantage is you keep them out of a competitors hands, you establlish a positive precedent with an airline who hasn't bought your planes before, you sell them a bunch of your add on services and you gain market share.

I would think Rockefeller and Gates have proven this strategy by now. Sell below cost to kill competition and then raise rates. Hell, whole countries like China are doing it now.  Wink



The dude abides
25 Atmx2000 : It would be foolish to start a second line before the aircraft is up in the air considering the amount of new technology in it. Also you never know w
26 Cobra27 : Problems with new technology would be the case anyway, 1 line or 2 . I am almost sure that it will grow 5% a year on (industry average), some carrier
27 Jacobin777 : The difference here is that Airbus has a good "feel" for what the 787 is going to be. Given its going to be a multi-decade product (at least 15 years
28 Trex8 : with the use of many farflung and independent risk sharing contractors for manufacturing Boeing does not have the direct ability to make these contra
29 JAAlbert : I think the huge product liability (lawsuits) associated with aircraft manufacturing would deter Boeing from ever allowing another company to construc
30 N328KF : That's silly. Lots of civil aircraft have had final assembly done under license. I think Boeing even did it for the C-47 (DC-3).
31 Mptpa : Well there are more than just the initial investment (fixed and sunk costs) that need to be recovered. This certainly is not based on a single order
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