The great divide

A lot of us were surprised when Airbus unveiled its version of the long range market forecast during the Paris Air Show. They typically hold that for later in the year, and what they shared at Le Bourget was clearly lacking in detail.

The one thing that was clear - the great divide between our forecast and Airbus’ when it comes to the very large airplane segment.

Over the next 20 years, Boeing forecasts the need for 540 new airplanes like the 747-8 and the A380. Our new Current Market Outlook reflects a continued shift from very large airplanes to twin-engine airplanes like the 787, 777X and A350.

But Airbus actually raised its very large airplane forecast by almost 50 units from last year, saying it expects a demand for 1,550 of these big airplanes. They make this prediction despite the fact that the A380 hasn’t received a single order all year.

On a side note, we also believe Airbus is forecasting too low on the single-aisle side. Take their forecast of 22,927 airplanes. That equals combined production rates of 95 per month over the next 20 years. Even if the market was split equally between Boeing and Airbus, which is unlikely since there are other single aisle competitors coming into the market, a production rate of about 48 per month wouldn’t match up to the higher production rates they’re talking about.

When Airbus launched the A380 in 2000, it predicted the demand for 1,235 very large passenger airplanes alone through the year 2019. Fast forward to today— and the total number of passenger VLA’s actually ordered is only 371. You do the math.

We use our forecast as a key part of our production rate decisions. This week, we announced that we’re lowering our 747-8 production rate again—this time to 1 airplane per month starting next March. While the very large airplane market continues to be challenging, we’re optimistic this adjustment and some good news on the cargo front will allow us to keep the program healthy.

With four firm 747-8 orders so far this year— and an MOU from Volga-Dnepr for 20 additional 747-8 Freighters — things are looking up.

In our view, the market for big airplanes is small—but viable. However, every trend and signal points to airlines moving toward small and medium widebodies as travelers demand more frequent point to point routes.

Final flight

The very first 787 ever built has taken its final flight. ZA001 landed in Nagoya, Japan at Centrair Airport. The airplane will stay here on permanent display.

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ZA001 lands in Nagoya.

The Nagoya area is home to many 787 suppliers, and we’re proud to donate the airplane to Centrair.

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A water cannon salute at Centrair Airport.

From its first flight to its final flight, ZA001 served us well. Thanks for the memories— and here’s to creating many more.

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Boeing pilots are greeted after ZA001 arrives in Japan.

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That's a wrap

Now that the 2015 Paris Air Show is in the books, I wanted to share some of my takeaways from the week.

First and foremost, I’ll always remember the excitement over the 787-9 flying display.

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The 787-9 in the flying display at the Paris Air Shows. Steve Eastell photos.

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The YouTube video of its rehearsal flight that went viral raised the anticipation at Le Bourget— and the airplane didn’t disappoint. Thanks to Vietnam Airlines for allowing us to showcase just what the 787 can do, while wowing the crowd in the process.

The 777-300ER for China Airlines was also a big hit. We were proud to help unveil the airline’s award-winning interior to the crowds at Le Bourget.

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It was hard to miss the China Airlines 777-300ER on static display. Marian Lockhart photo.

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On board the China Airlines 777-300ER with Jerry Verghese, our director of Brand Management and Advertising.

I also want to thank all of our customers who made announcements over the course of the week. We ended up with orders and commitments for 331 airplanes valued at $50.2 billion at list prices.

Of course, this is just one week out of 52. We still have a lot of things to accomplish the rest of the year. We’re still on track to deliver between 750 and 755 airplanes. That’s not only a Boeing record—it’s an industry record.

The first 737 MAX will roll out of the factory by the end of this year. And the 777X remains on schedule to reach firm configuration this year.

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A view of Le Bourget from the China Airlines 777-300ER. Marian Lockhart photo.

Thanks for following along this week as we say goodbye to Paris.

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Jumbo day at Le Bourget

Day 3 of the Paris Air Show started with some jumbo sized news from Volga-Dnepr. They signed a Memorandum of Understanding for 20 additional 747-8 Freighters. I’ve talked about the cargo market showing continued signs of improvement and this agreement backs that up.

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The 747-8 Freighter is already a key part of Volga-Dnepr’s business.

Our friends at Ethiopian Airlines officially announced their order for six 787-8s. They already have 13 Dreamliners and we’re proud to see them growing their fleet.

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The Ethiopian 787.

The last piece of news today came with our launch of the BBJ MAX 9. The first order is from an undisclosed European customer. This sale marks the fifth BBJ MAX order, counting the four BBJ MAX 8s already on the books.

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The BBJ MAX 9.

I’ll leave you today with some pictures of the great street scenes here in Paris—including some gelato that is well worth standing in line for.

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Day of the MAX

Day 2 of the Paris Air Show turned out to be the Day of the 737 MAX.

We kicked things off in a big way when AerCap announced an order for 100 MAX 8s. This is the first 737 MAX order for AerCap and we welcome them to the family.

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Celebrating with AerCap at Le Bourget. Marian Lockhart photo.

SMBC Aviation Capital was next with an order for 10 MAX 8s. This adds to their 2014 order for 80 MAX 8s.

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The afternoon saw back to back MAX announcements from our customers in China. Ruili Airlines committed to purchase 30 MAXs, followed by Minsheng Financial Leasing signing a Memorandum of Understanding for the purchase of 30 737s, a mix of NGs and MAXs.

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Signing ceremony for Ruili Airlines. Photo by Marian Lockhart.

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Minsheng signed an MOU for a mix of 737s.

We ended the day with Korean Air announcing their intent to purchase 30 737 MAXs and two additional 777-300ERs— along with options for an additional 20 MAXs.

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Korean Air announced an intent to purchase 30 MAXs and two more 777-300ERs. Marian Lockhart photo.

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And while it might be outside the MAX theme of this blog, I want to thank Sriwijaya Air for formally announcing their order for two 737-900ERs. It marks the first all-new airplane purchase for the Indonesian airline and included a letter of intent to exercise options for up to 20 additional 737s.

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Sriwijaya Air signs for 737s. Marian Lockhart photo.

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I’ll leave you with a few more photos from the 787-9 flying display. Enjoy.

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