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planecane
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 11:38 am

TMccrury wrote:
So, out of curiosity, would it be possible to modify a 777F to have a tail that swings open like the 747 used for 787 parts? This would solve the problem for larger pallets that couldn't fit through a side door. Maybe there isn't enough clearance for that to happen or there is some other structural reason for not having it.

As the old saying goes, "given enough time and enough money, anything is possible." Whether or not it would be PROFITABLE is the key question.
 
planecane
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 11:42 am

flyPIT wrote:
Revelation wrote:
IPut it another way: Suppose the factories that make the A380's fuselage skins, floor beams, doors, aft fuselage and tail section closed, all the major equipment was moved into storage, all the minor equipment was auctioned off, and all the factory workers found new jobs: would you say that the A380 was dead?

I think some key differences are that the A380 simply is not in demand.... but it seems the B748f still has some interest. Also, Airbus officially cancelled the A380 but here we learn there is still internal debate at Boeing. When Vought announced several months ago they are pulling out of the program I was in agreement that the 747 was done. But now the news that there is debate within Boeing several months later.... I dunno but like I said in my first post I don't think it is as cut and dry as it's made out to be. Just my 2 cents.

Maybe the internal debate is about whether it makes sense to fill the existing orders, not whether to extend the life of the the line and take new orders.
 
Ziyulu
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 11:47 am

How close was UA and DL from ordering the 748?
 
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TurboJet707
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 12:40 pm

Pretty far I would say. If I remember correctly, both UA and DL have expressly stated they were not interested in the 747-8 (or A380).
 
Jetport
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 1:58 pm

VV wrote:
Closing a program is expensive and Boeing will have to write down a large sum.

A timing for the end of 747-8F production in 2023 seems to be about right when Boeing's results will have become more normal.


I am not going to take the time to search, but I am pretty sure Boeing has already written down most of the costs related to the 747-8. I believe they did this last when they slowed the line to 6 a year.
 
frmrCapCadet
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 2:04 pm

To summarize, while Boeing may not have exactly done a last call a few years ago, they seem to have let customers know that the 748 was approaching the end of its life, and subcontractors were getting impatient. Order now if you think you want a few (or many), because the next batches will have to be priced a lot higher to restart the supply chain. "Now" is now in the past.
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GalaxyFlyer
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 2:08 pm

jagraham wrote:
Revelation wrote:
Stitch wrote:
There is no chance that the USAF is going to suddenly drop a massive "Hail Mary" 747-8 order, be it for strategic airlift or as an E-4B replacement.

The USAF will do what they always do when they need short-term pallet lift - contract with freight operators.

As for the E-4B, that will almost certainly be a 767-2C platform. This is not the 1970s when the doctrine was to fight an extended nuclear conflict over weeks with scores of exchanges employing many thousands of warheads which required a 100-member battle staff and the ability to support them for an extended period as they roamed around the world outrunning the fallout / nuclear winter.

Agree, there does seem to be a lot of "the past is prologue" / "fighting the last war not the next war" thought patterns emerging on this thread.

USAF has militarized 767 and 737 platforms close to hand for various future command/control roles. USAF has plenty of mission ready airlift, and can tap lots of commercial providers if/when the spam hits the fan. Heck if airlines are willing to rip chairs out for COVID and carry freight on the main deck, we can see they could do a lot of airlift should warfare shut down sources of commercial revenue. Not that i expect this to be needed. I also don't see the need for 200+ C-17s, but that's just me.


The need for C17s is to move tanks and heavy artillery quickly. A better general would have taken advantage of the 6 month buildup window and make the Gulf War hell for the USA. USAF needs to be able to move a division in a day or two, not a month or two. But that problem has been around for a while and USAF always priortizes fighters . . . a wing of 748Fs would cut the fuel bill for over ocean flying in half, but if the USAF hasn't pulled the trigger yet, it's doubtful they will do so now.


Can you cite your military experience? Do you have any idea how many 747 loads one division is? 95% of Army moves is by sea or pre-positioned ships. The small part of Clinton’s India trip was 10 C-5 loads to move helicopters.
 
tootallsd
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 2:21 pm

So 'When will BA restart 747 production" is the next "Why don't we just restart 757 production" thread of the future. Boeing is streamlining their product offering. 747 has had a good long run after revolutionizing air transport. 787 help drive other changes that moved the industry away from the need for 100s of VLAs -- hence the sudden end to A380 production and use. Of course A350 is accelerating that trend. For the near future there are three products 737 -- narrow body, 787 as for wide body and 777X as VLA. 777F will live for a while but be replaced by the XF version at some future. 7779X sales will be lethargic for at least half decade, but it is a product size the industry will need over time.
 
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SEPilot
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 2:24 pm

Ziyulu wrote:
I now wish the 787 would not have been invented and more airlines would order the 748.

It wasn’t the 787 that killed the 748, it was the 77W.
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CX747
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 3:48 pm

Revelation wrote:
DartHerald wrote:
With fbw aircraft is it potentially easier to design a lifting or opening nose than it is for one with the controls connected by wires and pulleys?

The issue really isn't the control mechanism, the issue is that a nose opening has to be designed in right from the start like 747. All the structural load paths have to be engineered to allow a nose opening like 747 did. It's also a big part of why there is a seperate 747-8F vs -8i. The freighter has the shorter upper deck, the nose opening, and some reinforcement for higher take off weight. The pax model saves weight by getting rid of the nose opening and adds the longer upper deck to carry more pax.


Does anyone know the design differences in the upper deck or front of the 747-200F, 747-400F and 747-8F? While we see stretches on the pax side, the cargo variants all have very similar humps.
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
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Revelation
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 3:53 pm

Jetport wrote:
And once any component or sub assembly goes out of production on an older aircraft, it is totally impossible to build it again ever, another Anet truism I have heard many times. If once a part goes out of production you can't make a new version economically, how did the original version ever get made in the first place? :stirthepot:

No one said it was totally impossible. Heck some members even provided estimates that 30 orders would get it done, yet no one can picture how 30 orders would materialize in the needed time frame. Some will question if even 30 orders could make it happen. There's really no point in doing it if there isn't strong profit or tactical necessity in it, because it's aging tech with little growth potential and Boeing is struggling in the current environment.

A part? We're talking about needing new vendors for all the fuse skins aft of the front section, floor beams, doors, entire aft and tail sections.

I get it that exaggeration can be used in a discussion, but you're showing how it can be taken too far.
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VV
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 4:40 pm

Jetport wrote:
VV wrote:
Closing a program is expensive and Boeing will have to write down a large sum.

A timing for the end of 747-8F production in 2023 seems to be about right when Boeing's results will have become more normal.


I am not going to take the time to search, but I am pretty sure Boeing has already written down most of the costs related to the 747-8. I believe they did this last when they slowed the line to 6 a year.


I think you misunderstood that article.
 
Jetport
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 5:16 pm

Another article today on FlightGlobal about Boeing freighter strategy.

https://www.flightglobal.com/flight-int ... 55.article
 
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Stitch
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 5:21 pm

Jetport wrote:
According to all of the armchair aviation savants on ANet the 747 was cancelled several years ago, wasn't it? And once any component or sub assembly goes out of production on an older aircraft, it is totally impossible to build it again ever, another Anet truism I have heard many times. If once a part goes out of production you can't make a new version economically, how did the original version ever get made in the first place? :stirthepot:


It depends on the part now, doesn't it?

Fuselage and wing panels are pretty large structures requiring pretty large jigs to manufacture. Sourcing all new jigs is not inexpensive and you also need space for them.

Back in 2015, when Boeing was more confident on the long-term production prospects of the 747, they were ready to buy all that tooling from their suppliers and send it to an unused facility in Georgia and doing it themselves. Then UPS threw the program a critical life-line with two large orders and the suppliers were agreeable to continue holding on to the tooling and filling orders. But once those orders were filled at the end of 2019, and there was no new life-line to grasp onto, Boeing could have still bought all the tooling and moved it to a new facility, but they didn't. Instead, they allowed that tooling to be sold off for scrap. Which is pretty strong evidence that they were no longer confident on the short-term production prospects of the 747, much less the long-term prospects.
 
Jetport
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 5:29 pm

VV wrote:
Jetport wrote:
VV wrote:
Closing a program is expensive and Boeing will have to write down a large sum.

A timing for the end of 747-8F production in 2023 seems to be about right when Boeing's results will have become more normal.


I am not going to take the time to search, but I am pretty sure Boeing has already written down most of the costs related to the 747-8. I believe they did this last when they slowed the line to 6 a year.


I think you misunderstood that article.


While there will certainly be write downs when the 747 program (or any program) closes, there are no more deferred costs to write down.

https://airwaysmag.com/industry/boeing- ... 7-charges/

Salient quote from the linked article:

"....Boeing has been forced to write down all of the remaining 747-8 deferred production costs to the tune of the $814 million after-tax charge that Boeing incurred. This reduces Boeing’s financial risk on the 747-8 program and makes it easier for Boeing to discontinue production. ...."
 
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Stitch
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 5:31 pm

UA444 wrote:
You got proof Boeing did a last call?


No, and I doubt you have proof they didn't.

What I do have is strong circumstantial evidence that they did. Do you have the same that they didn't?



VV wrote:
Closing a program is expensive and Boeing will have to write down a large sum.


It might not actually be that expensive.

Boeing has already written down the Deferred Production Costs multiple times to reflect the program's lurching into and out of the grave, to the tune of almost $3.8 billion as of June 2016 which is when Boeing expected the program to end shortly (before UPS swooped in and saved it). As of their last 10K, I believe the remaining DFP is under $100 million and that should all be tagged to the remaining UPS frames so it will be recovered through deliveries, leaving none left over to write down.

All of the 747-related tooling has to have been fully amortized by now based on it's age. So are the buildings that tooling is contained in. So there should be no write-downs for that.

That would leave staff (engineering and production), but chances are those will either retire or move to other programs. And even if there are some forced terminations, I am not sure that is a write-downable expense.
 
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Stitch
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 5:36 pm

planecane wrote:
Maybe the internal debate is about whether it makes sense to fill the existing orders, not whether to extend the life of the the line and take new orders.


UPS is probably good for the frames they have on order. Plus, Boeing should have already secured all the parts they need for them in the warehouse.


Ziyulu wrote:
How close was UA and DL from ordering the 748?


"Never" and "hell no never", respectively.


CX747 wrote:
Does anyone know the design differences in the upper deck or front of the 747-200F, 747-400F and 747-8F? While we see stretches on the pax side, the cargo variants all have very similar humps.


I don't believe there is a difference. For the 747-8F freighter, the plug was just forward of the wing and well behind the upper deck so that would be identical to the 747-400F and I believe the earlier 747 freighter models all have identical upper deck lengths to the 747-400F.
 
CX747
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 6:53 pm

Jetport wrote:
Another article today on FlightGlobal about Boeing freighter strategy.

https://www.flightglobal.com/flight-int ... 55.article


It would seem FG is reading some of our posts here!

The article does shed light on many issues that have been discussed here. The article lays out some issues in new light that we haven't touched upon here yet. It also puts the current state of affairs in order again but in different wording.

747-8F- Decision to continue production beyond 2022 has yet to be made.
767-300F- A strong offering but will not be compliant with 2028 ICAO standards.
777F- A strong offering but will not be compliant with 2028 ICAO standards.
777XF- Uncertainty on when/if it will go forward, as it is tied to the 777-8.

The 2028 building standards have made me re-think Boeing's upcoming decisions. The 747-8F is the only freighter they currently make that does not require modifications to meet 2028 building guidelines. The 777F comes to its end in 2028 unless money is pumped into the program. Building it alongside the 777-9 creates a two birds on one line process.
Additionally, the 777-8 and the supposed 777-XF's timeline are up in the air. The 767-300F itself is going to need new engines if it is to meet 2028 standards.

So, will Boeing put new engines on both the 767 and 777 to meet 2028 standards? That's a good amount of money. If done on the 777, will they offer the supposed 777-XF only a short time later? If either 777 offering runs behind or has issues extending past 2028, without the 747 in production, you are left with zero offerings until you get it right.

I think they put new engines on the 767. No way that workhorse gets put on the chopping block. USAF, FEDEX, UPS... Can the 767 use the current 747/787 engines with some tweaks? If so, can the 747F line (if in production) have those tweeks passed its way too?

The 777F and 777XF are the conundrum. You are not going to re engine the 777F to then kill it less than a few years later with the 777-XF. IF you don't do the XF, how does a re engined 777F compete against the A350F possibility?

You obviously need people to want your product. I think the 747 continues on. Boeing finds a way to sit down and make some sales. That program is your insurance policy against an issue with what you do in the 777F/XF/A350F fight. You can offer it to customers if you run late on the next 777 freighter variant ala the 767 on the 787 program. Once you have the new 777 freigther offering rocking, then you can turn your eyes to the Queen and see if it is time to close the books.

Should be fun to see what they do.
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
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Stitch
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 7:12 pm

Building the 777-8F should be a relatively easy decision and it is one that does not necessarily need the 777-8 to exist to bring forward. Such a frame could replace both the 747-8F and the 777 Freighter and combined with a 737MAX freighter and a 767neo, would continue to support Boeing's entrenched position in the freighter marketplace.
 
jfk777
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 9:49 pm

The tea leaves have been saying the 747 is coming to its distinguished end. Sadly the 777 put the 747 out of business. The 747-8 sold poorly to only three airlines as a passenger plane. Maybe it’s surprising it lasted this long. Five decades is a long time for a passenger airplane to be sold, Look at all it achieved. How many millions of us took our first trip to another continent in a 747 ? Billions of us. Sad the Queen will soon be dead long may she and her memories live in our hearts.
 
VV
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 10:12 pm

Jetport wrote:
VV wrote:
Jetport wrote:

I am not going to take the time to search, but I am pretty sure Boeing has already written down most of the costs related to the 747-8. I believe they did this last when they slowed the line to 6 a year.


I think you misunderstood that article.


While there will certainly be write downs when the 747 program (or any program) closes, there are no more deferred costs to write down.

https://airwaysmag.com/industry/boeing- ... 7-charges/

Salient quote from the linked article:

"....Boeing has been forced to write down all of the remaining 747-8 deferred production costs to the tune of the $814 million after-tax charge that Boeing incurred. This reduces Boeing’s financial risk on the 747-8 program and makes it easier for Boeing to discontinue production. ...."


That was when they knew they had to stop the 747-8 Intercontinental below the initially projected number.

There is something for the 747-8F. I cannot say what the amount is.

In addition the decommissioning of the production means will incur some costs.
 
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Stitch
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 10:35 pm

Whatever costs Boeing needs to incur for closing down the 747, now is the time to book them since the stock is in the toilet.

Hell, they should have written down the remaining 787 DFP while they were at it.
 
Jetport
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Re: ​Internal tussle as Boeing weighs future of 747

Fri May 29, 2020 11:28 pm

Stitch wrote:
Whatever costs Boeing needs to incur for closing down the 747, now is the time to book them since the stock is in the toilet.

Hell, they should have written down the remaining 787 DFP while they were at it.


Boeing may well wright down all deferred costs this quarter for everything. Many publicly traded US companies of all sorts plan to have "Kitchen Sink" quarters in Calendar Q2 2020 since it will be so bad anyway. This will give everyone a fresh start in July to hopefully show sequential improvement.
 
rbavfan
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 2:48 am

NameOmitted wrote:
Would it be possible for Airbus to develop a civilian A400M that could be cost-competitive for outsized cargo?


With all the Issues the A400M is having who would be willing.
 
CX747
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 3:19 am

777-8F needs to be done. Let the 777F just continue to cruise until it is time to bow out for the next 777 freighter. When we look at costs, do we have an idea on how much the new freighter will cost to build? Funny to think the 777F is grounded due to being old tech but the 747 could continue to rock on.

767 re engine program is a no brainer in my opinion. Good customer base (USAF, FEDEX & UPS). Honestly, it has no real competition in the cargo market. It is perfectly sized for what it is called upon to do. Amazon has been hitting up the used 767 market for its fleet. Wonder if you could reel them in with a launch customer order alongside FEDEX/UPS/USAF????

This now leaves us with the 747. I can see the argument of closing the line and focusing on the new engined 767 and 777-8F. Where is your backup or offering past 2028 should those programs run into issues? The market HAS to be there obviously but continuing production another 5-7 years is 30-42 freighters. That is not tough to imagine as there are 155 747-400Fs in service right now. Replacing just 40% of that fleet with similar 747 only capabilities is 60+ airframes. 5-7 years allows the 747-8F to capture the 747-400F replacement market that wants/needs/desires a nose loading VLA. Bringing on the 777-8F "quickly" allows you to capture the remainder of the 747-400F market. A one stop shop with 2 offerings to replace the 747-400Fs of the world. Once you are done with that "recapitilization" period, you can address the future of the 747-8F.
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
FGITD
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 5:31 am

Where exactly is this whole 747 passing the ICAO 2028 standard but 777 not, coming from?

I think even by the absolute most optimistic perspective, the idea that a new standard being instituted by 2028 will save the 747 line is more than a bit far fetched.
 
UA444
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 5:48 am

Stitch wrote:
UA444 wrote:
You got proof Boeing did a last call?


No, and I doubt you have proof they didn't.

What I do have is strong circumstantial evidence that they did. Do you have the same that they didn't?



VV wrote:
Closing a program is expensive and Boeing will have to write down a large sum.


It might not actually be that expensive.

Boeing has already written down the Deferred Production Costs multiple times to reflect the program's lurching into and out of the grave, to the tune of almost $3.8 billion as of June 2016 which is when Boeing expected the program to end shortly (before UPS swooped in and saved it). As of their last 10K, I believe the remaining DFP is under $100 million and that should all be tagged to the remaining UPS frames so it will be recovered through deliveries, leaving none left over to write down.

All of the 747-related tooling has to have been fully amortized by now based on it's age. So are the buildings that tooling is contained in. So there should be no write-downs for that.

That would leave staff (engineering and production), but chances are those will either retire or move to other programs. And even if there are some forced terminations, I am not sure that is a write-downable expense.

You’re the one saying they did a last call in 2018, as if you know for certain. Burden of proof is on the accuser. So if you have proof shows us.

My proof? As of May 29, 2020 Boeing has not said anything regarding closing the 747 line. That’s all the proof I need.

You can extrapolate, you can guess, you can come to reasonable conclusions on circumstantial evidence all day long. The fact is they’ve said in this article that the 747 is open for business.
 
VV
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 12:09 pm

rbavfan wrote:
NameOmitted wrote:
Would it be possible for Airbus to develop a civilian A400M that could be cost-competitive for outsized cargo?


With all the Issues the A400M is having who would be willing.


What does A400M have to do with 747?

Anyway, the production rate of the 747-8F today is probably too low to be profitable.

End of the 747 line in around 2023/2024 seems to be about right.
 
VV
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 12:15 pm

Stitch wrote:
Whatever costs Boeing needs to incur for closing down the 747, now is the time to book them since the stock is in the toilet.

Hell, they should have written down the remaining 787 DFP while they were at it.


  • There is no relationship between writing off the closing of the line and the stock price.
  • The deferred production cost will be there until the last 747-8F is delivered. Then they need to spend the cost of decommissioning and re-purposing of the production means.
    They can declare a provision of the cost (charge) one or two years before the closure or they can wait until the end, depending on their financial situation by then
 
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Revelation
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 2:47 pm

VV wrote:
The deferred production cost will be there until the last 747-8F is delivered.

That's not my understanding. It's a loan from Boeing to Boeing, and Boeing can write it off any time they want. It's not hard to imagine that now is a good time to do so. The stock has been hammered, it's a good time to get rid of this kind of stuff.
Wake up to find out that you are the eyes of the world
The heart has its beaches, its homeland and thoughts of its own
Wake now, discover that you are the song that the morning brings
The heart has its seasons, its evenings and songs of its own
 
CX747
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 7:52 pm

FGITD wrote:
Where exactly is this whole 747 passing the ICAO 2028 standard but 777 not, coming from?

I think even by the absolute most optimistic perspective, the idea that a new standard being instituted by 2028 will save the 747 line is more than a bit far fetched.


https://www.flightglobal.com/flight-int ... 55.article

ICAO standards currently preclude the 767-300F and 777F from being sold past 2028 due to emission standards. The 767's and 777's engines are older tech than the 747's. However you slice it, all three programs need an investment to move forward. The 747's requires a new partner to build certain parts, while both the 767 and 777 would need new engines. Customers are obviously required but at this time, the 747's costs to continue production may actually be less than the 767 or 777 program's.
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
UA444
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 8:05 pm

CX747 wrote:
FGITD wrote:
Where exactly is this whole 747 passing the ICAO 2028 standard but 777 not, coming from?

I think even by the absolute most optimistic perspective, the idea that a new standard being instituted by 2028 will save the 747 line is more than a bit far fetched.


https://www.flightglobal.com/flight-int ... 55.article

ICAO standards currently preclude the 767-300F and 777F from being sold past 2028 due to emission standards. The 767's and 777's engines are older tech than the 747's. However you slice it, all three programs need an investment to move forward. The 747's requires a new partner to build certain parts, while both the 767 and 777 would need new engines. Customers are obviously required but at this time, the 747's costs to continue production may actually be less than the 767 or 777 program's.

PW should offer an upscaled GTF for the civilian 767s. You’d likely see the cargo airlines and potential passenger airlines come to the table. The USAF can then take a second batch of tankers to replace more KC-135s
 
VV
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 8:12 pm

Revelation wrote:
VV wrote:
The deferred production cost will be there until the last 747-8F is delivered.

That's not my understanding. It's a loan from Boeing to Boeing, and Boeing can write it off any time they want. It's not hard to imagine that now is a good time to do so. The stock has been hammered, it's a good time to get rid of this kind of stuff.


No, deferred production cost builds up as they continue building aircraft, so it will be there until the last one is built. At every delivery normally they write off the corresponding deferred production cost to the unit.

They can manage the timing to write it off, but it would not be very clever to write off production cost preemptively like a provision.

So yes, I expect them to write off a small amount of deferred production cost toward the end of the production, depending if they achieve the expected number of deliveries or not, and then declare a charge (provision) against the program for the decommissioning of the production facility.

Just to give you an example, the 787 deferred production cost is going to decrease a lot during the next twelve month quarter by quarter because Boeing is slowing down the production. Just watch the earning reports.

https://www.boeing.com/investors/accoun ... production
Last edited by VV on Sat May 30, 2020 8:16 pm, edited 2 times in total.
 
CX747
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 8:14 pm

Revelation wrote:
VV wrote:
The deferred production cost will be there until the last 747-8F is delivered.

That's not my understanding. It's a loan from Boeing to Boeing, and Boeing can write it off any time they want. It's not hard to imagine that now is a good time to do so. The stock has been hammered, it's a good time to get rid of this kind of stuff.


I don't post here as often as you do. Please take the response as a differing viewpoint over a beer.

"Pleasing" the street gets companies into plenty of issues. Yes, it is an aspect of business but stock price should be way down on the list of reasons as to why a certain product is kept or shut down. I know guys who have that as their #1 priority when they walk into a boardroom. To me that hollows out a company. Focusing on making superior products, at a profitable rate and gaining/maintaining market share should all come way ahead of the Dow Jones. What can the 747 do for the company IF they find a new parts supplier? What number of jets can be sold? What do those sales do for our other programs? Does it keep market share? Gain market share? Enable us to position other assets in better light that have a greater sales/profit potential? All those things should be driving the day.

The effect those decisions have on stock price is what I ask, after the decision from a health of the company perspective has been made. Ok finance guy, how do we best make this move?
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
FGITD
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 8:59 pm

CX747 wrote:
FGITD wrote:
Where exactly is this whole 747 passing the ICAO 2028 standard but 777 not, coming from?

I think even by the absolute most optimistic perspective, the idea that a new standard being instituted by 2028 will save the 747 line is more than a bit far fetched.


https://www.flightglobal.com/flight-int ... 55.article

ICAO standards currently preclude the 767-300F and 777F from being sold past 2028 due to emission standards. The 767's and 777's engines are older tech than the 747's. However you slice it, all three programs need an investment to move forward. The 747's requires a new partner to build certain parts, while both the 767 and 777 would need new engines. Customers are obviously required but at this time, the 747's costs to continue production may actually be less than the 767 or 777 program's.


I know the new standard, but where exactly are you getting that the 747-8F is that much more efficient than the 777F or 763F? The only chart I found had the -8 being considerably further from the target emission.

Of course this is all about a regulation going into effect in 8 years, in a discussion about aircraft that will very likely be long out of production by then
 
Aptivaboy
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Re: ​Internal tussle as Boeing weighs future of 747

Sat May 30, 2020 9:00 pm

If there are enough orders to justify a restart, Boeing won't have any trouble finding subcontractors to make parts and fuselages. We're in the middle of a serious global economic crisis. If a subcontractor can make a profit on a restarted 747 program, they'll likely jump at the chance, even if the profit margin is slender. I wouldn't want to be the CEO of an aerospace company having to explain why he'd turned down work at a shareholders' meeting. The key is that Boeing would need to make a restart decision relatively quickly before a recovery takes place, and while potential subcontractors might be a bit hungrier for work at thinner profit margins.
 
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Revelation
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 12:44 am

Meanwhile, it seems one of the few remaining parties interested in 748F is unhappy that Boeing believed them when they said they didn't want the ones they had on order pre-covid:

https://www.seattletimes.com/business/b ... ed-market/
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JayinKitsap
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 1:09 am

Wow, just wow. The 748F has a total of 107 orders, with half placed before 2008. UPS has bought 36 and their first order was in 2016. Orders and deliveries around 10 per year. An order of at least 25 units would be necessary to cover the cost of restarting the line. If Boeing thought that would have been possible, they would have bought the factory or at least the jigs. The restart cost would be $10M a plane, if lucky. Spirit could possibly do it, but a whole lot of pain for 25 units. Other suppliers on the 747 might now be happy to produce anything, but who is the mystery buyer that can 25 or more units.

There is some magic date to get by before announcing a closing of the line. They have set the factory schedule to go real slow, announce a few months past that date. Give the Airline (LH?) a great deal on 78X's as a thank you for not returning a whole bunch of planes.
 
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Stitch
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 1:12 am

Revelation wrote:
Meanwhile, it seems one of the few remaining parties interested in 748F is unhappy that Boeing believed them when they said they didn't want the ones they had on order pre-covid...


And they only seem to be fighting to get one of the four they ordered... :scratchchin:


Anyway, the 747-8 will not meet the 2028 ICAO emissions standards (it is around 10% over them - about the same as the 777F) so unless the freighters are made exempt from the standards, Airbus and Boeing will need to update their entire new build freighter line-up anyway since all the models (A32xF, A330-200F, 737-800F, 767-300F, 777F and 747-8F) will not be sellable after that date. And if those standards also apply to new passenger to freighter conversions, that would put even more pressure on Airbus and Boeing to push to make freighters exempt.
 
JayinKitsap
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 1:18 am

Revelation wrote:
Meanwhile, it seems one of the few remaining parties interested in 748F is unhappy that Boeing believed them when they said they didn't want the ones they had on order pre-covid:

https://www.seattletimes.com/business/b ... ed-market/


They probably found someone that now thinks they would be a great investment, and possibly there is a 't' not crossed in the contract. Someone should know at least a but of scuttlebutt. I recall their last 748F they accepted, it had sat for several months at Everett without payment. These orders for (4) 747F and some 777F were removed from the orders per the ASC606 adjustments, those orders that are on the books but circumstances are that they are never getting built.


The OP was about customers that couldn't get Boeing on the phone or to respond. I suspect it was ABC and its parent, could be others too.
 
CX747
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 2:34 am

[photoid][/photoid]
FGITD wrote:
CX747 wrote:
FGITD wrote:
Where exactly is this whole 747 passing the ICAO 2028 standard but 777 not, coming from?

I think even by the absolute most optimistic perspective, the idea that a new standard being instituted by 2028 will save the 747 line is more than a bit far fetched.


https://www.flightglobal.com/flight-int ... 55.article

ICAO standards currently preclude the 767-300F and 777F from being sold past 2028 due to emission standards. The 767's and 777's engines are older tech than the 747's. However you slice it, all three programs need an investment to move forward. The 747's requires a new partner to build certain parts, while both the 767 and 777 would need new engines. Customers are obviously required but at this time, the 747's costs to continue production may actually be less than the 767 or 777 program's.


I know the new standard, but where exactly are you getting that the 747-8F is that much more efficient than the 777F or 763F? The only chart I found had the -8 being considerably further from the target emission.

Of course this is all about a regulation going into effect in 8 years, in a discussion about aircraft that will very likely be long out of production by then


Maybe we crossed wires or stepped on one another's transmissions. The FG article stated the 767-300F and 777F do not currently meet 2028 guidelines. The article does not list that as an issue for the 747-8F.

Potentially, the 747-8F has the same issues but the FG article did not highlight that. Do we have any articles/data showing the 747-8F not meeting the 2028 standards?

2028 is indeed a little bit in the future! The older I get though, the faster they pass.
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CX747
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 2:49 am

Stitch wrote:
Revelation wrote:
Meanwhile, it seems one of the few remaining parties interested in 748F is unhappy that Boeing believed them when they said they didn't want the ones they had on order pre-covid...


And they only seem to be fighting to get one of the four they ordered... :scratchchin:


Anyway, the 747-8 will not meet the 2028 ICAO emissions standards (it is around 10% over them - about the same as the 777F) so unless the freighters are made exempt from the standards, Airbus and Boeing will need to update their entire new build freighter line-up anyway since all the models (A32xF, A330-200F, 737-800F, 767-300F, 777F and 747-8F) will not be sellable after that date. And if those standards also apply to new passenger to freighter conversions, that would put even more pressure on Airbus and Boeing to push to make freighters exempt.


Interesting to know on the ICAO info. Wonder why the FG article was written in its fashion?

ABC was fighting for the aircraft they were able to get financing for, which was only 1 747-8F. Slightly fascinating that Boeing was/is already in final stages to sell the 747-8F to another buyer!
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
moa999
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 3:05 am

CX747 wrote:
767 re engine program is a no brainer in my opinion. Good customer base (USAF, FEDEX & UPS). Honestly, it has no real competition in the cargo market. It is perfectly sized for what it is called upon to do..


But the current environment is why it won't happen.
Al these 767s coming onto the conversion market mean there is zero chance of a freight company buying a neo anytime soon.
 
smartplane
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 3:55 am

FGITD wrote:
Where exactly is this whole 747 passing the ICAO 2028 standard but 777 not, coming from?

I think even by the absolute most optimistic perspective, the idea that a new standard being instituted by 2028 will save the 747 line is more than a bit far fetched.

Standard applies to new build aircraft manufactured after 31 December 2027. Part of ICAO's 4 pillar emissions strategy. Officially no impact on aircraft already in service, however there were suggestions it should be broadened to include significant modifications undertaken from 2028. So a passenger aircraft built in in say 2018 could continue to fly beyond 2028, but could not be converted from passenger to freight after 2027. The logic is it is a significant change, and increases life expectancy.

Aircraft operated domestically for example within the USA do not need to comply if the USA chooses not to make it mandatory. However, if the operator flies internationally, but not with the non-compliant aircraft model, it still has to be reported for CORSIA purposes, which affects the operators published performance, ratings and rankings.

Of much more concern to airlines at present, is 2020 is a base year for the CORSIA formula, which will be the basis of calculating, rewarding and penalising future emissions. Airlines are asking for 2021 to be the new base year (2nd year of two), and / or for the growth formula to be amended, with later phases delayed one year. UN/ICAO amenable to changing the base year, but not deferring rollout of phases 1 and 2.
 
744SPX
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 4:40 am

Stitch wrote:
Revelation wrote:
Meanwhile, it seems one of the few remaining parties interested in 748F is unhappy that Boeing believed them when they said they didn't want the ones they had on order pre-covid...


And they only seem to be fighting to get one of the four they ordered... :scratchchin:


Anyway, the 747-8 will not meet the 2028 ICAO emissions standards (it is around 10% over them - about the same as the 777F) so unless the freighters are made exempt from the standards, Airbus and Boeing will need to update their entire new build freighter line-up anyway since all the models (A32xF, A330-200F, 737-800F, 767-300F, 777F and 747-8F) will not be sellable after that date. And if those standards also apply to new passenger to freighter conversions, that would put even more pressure on Airbus and Boeing to push to make freighters exempt.



As the 748 uses the GEnx, then I assume the 787 will also not meet the 2028 ICAO emissions standard?
 
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gennadius
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 5:17 am

Stitch wrote:
Revelation wrote:
Meanwhile, it seems one of the few remaining parties interested in 748F is unhappy that Boeing believed them when they said they didn't want the ones they had on order pre-covid...


And they only seem to be fighting to get one of the four they ordered... :scratchchin:


The article makes it seem that they want all 4, as well as the 777Fs that Boeing put on the ASC 606 list, unless there is another source that I am missing.

From the Seattle Times text:

Volga-Dnepr then managed to secure financing for the four aircraft, and on April 13, revoked its previous statement and declared itself ready to take delivery of the 747-8 “as soon as possible.”

On May 1, it retracted its statement that it couldn’t honor the 777 contract, and said it was able to take delivery of those, too.


And

It argues that it should be penalized no more than having to pay 46 days of storage fees. Otherwise, it wants all four airplanes and is suing for damages as well.
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lightsaber
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 5:30 am

Improvements to aircraft aren't prohibited by the new regulations as far as I can tell. Thus 777-300ERSF conversions, as well as other freighter conversions, will be expected post 2028.

Do we really know the 747-8F isn't compliant?

744SPX wrote:
Stitch wrote:
Revelation wrote:
Meanwhile, it seems one of the few remaining parties interested in 748F is unhappy that Boeing believed them when they said they didn't want the ones they had on order pre-covid...


And they only seem to be fighting to get one of the four they ordered... :scratchchin:


Anyway, the 747-8 will not meet the 2028 ICAO emissions standards (it is around 10% over them - about the same as the 777F) so unless the freighters are made exempt from the standards, Airbus and Boeing will need to update their entire new build freighter line-up anyway since all the models (A32xF, A330-200F, 737-800F, 767-300F, 777F and 747-8F) will not be sellable after that date. And if those standards also apply to new passenger to freighter conversions, that would put even more pressure on Airbus and Boeing to push to make freighters exempt.



As the 748 uses the GEnx, then I assume the 787 will also not meet the 2028 ICAO emissions standard?

787, MAX, and 777X all meet the new standard:
https://www.airspacemag.com/daily-plane ... 180958088/


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Stitch
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 5:36 am

744SPX wrote:
As the 748 uses the GEnx, then I assume the 787 will also not meet the 2028 ICAO emissions standard?


The 787 family is 10 to 17% below the 2028 standards. The A330neo and A350 are similar.


gennadius wrote:
The article makes it seem that they want all 4, as well as the 777Fs that Boeing put on the ASC 606 list, unless there is another source that I am missing.


The "four" frames they want are one 747-8F and three 777F.


lightsaber wrote:
Do we really know the 747-8F isn't compliant?


The data I have seen is only for passenger frames, but I would expect freighter frames of the same family would be similar since the standards are based on MTOW.
 
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gennadius
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 6:52 am

Stitch wrote:
gennadius wrote:
The article makes it seem that they want all 4, as well as the 777Fs that Boeing put on the ASC 606 list, unless there is another source that I am missing.


The "four" frames they want are one 747-8F and three 777F.


Ah, that makes more sense with respect to the near term deliveries and the financing. Thank you.
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scbriml
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Re: ​Internal tussle as Boeing weighs future of 747

Sun May 31, 2020 8:00 am

744SPX wrote:
As the 748 uses the GEnx, then I assume the 787 will also not meet the 2028 ICAO emissions standard?


As far as I can see, it's about total emissions by the aircraft, not individual engines. The 747 having twice the number of engines as a 787 will produce roughly twice the total emissions.
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