Building our future

It was another strong quarter here at Boeing, with Commercial Airplanes leading the way thanks to an 18 percent increase in deliveries compared to the same quarter last year. It’s a testament to our people and our plan, as we execute on our production rate increases and drive productivity.

We booked 235 net orders during the first quarter and delivered 161 airplanes, up from 209 and 137 in the same period last year. At the same time, we kicked off some major expansion projects that will play a huge part in our future— developing the Puget Sound into a center for composite technology with our 777X wing facility, and expanding our 737 Delivery Center in Seattle to accommodate 737s being produced at record rates.

Here are some other things I took away from today’s earnings call:

• There’s high confidence in our ability to execute a successful production bridge to the 777X.

• The 787 fleet is flying more than 260 flights per day. Overall dispatch reliability is trending positively at above 98%.

• We remain on track to deliver the first 787-9 to Air New Zealand around the middle of this year.

• Customer interest in the 737 MAX remains very high as we close in on 2,000 total orders.

It promises to be another busy year for us, but we’re up to the challenge. Here’s a look back at our first quarter highlights in photos, and in this video.

737

 First 737 built at the rate of 42 airplanes per month rolls out of the factory in Renton.

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The first 737 at the increased rate of 42 airplanes per month rolls out of the Renton factory.

 Major expansion begins on the 737 Delivery Center at Boeing Field to support increasing production rates.

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737 VP & General Manager Beverly Wyse takes the first ceremonial swing as we make way for an expanded 737 Delivery Center in Seattle.

 737 Configuration Studio is unveiled in Renton to assist customers with interior design and configuration for the Next-Generation 737 and 737 MAX.

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A new studio showcasing 737 interiors.

 Alaska Airlines takes delivery of its 100th Next-Generation 737.

 Air Canada finalizes an order for 61 737 MAX 8s and 9s.

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Air Canada finalized their 737 MAX order.

 Flydubai finalizes an order for 75 737 MAX 8s and 11 Next-Generation 737-800s. It is Boeing’s largest single-aisle order in the Middle East.

 SpiceJet announces an order, previously attributed to an unidentified customer, for 42 737 MAX 8s.

 SunExpress finalizes an order for 15 737 MAX 8s and 25 Next-Generation 737-800s. It is the largest order in the nearly 25-year history of the Turkish carrier.

 GE Capital Aviation Services (GECAS) announces an order, previously attributed to an unidentified customer, for 20 737 MAX 8s and 20 737-800s, giving GECAS the most 737 orders in the leasing industry.

 Boeing launches the BBJ MAX family after receiving the first order from an undisclosed customer for a business jet based on the 737 MAX 8.

747

 Cargolux Airlines finalizes an order for an additional 747-8 Freighter, bringing its unfilled orders for the jumbo freighter to five.

 A 747-8 Freighter painted in a Seattle Seahawks livery pays tribute to the team’s first Super Bowl victory with a flyover of Seattle’s CenturyLink Field. The airplane also took flight before the game, tracing the number “12” over Eastern Washington in a salute to fans, known collectively as the “12th Man.”

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The 747-8 in Seahawks livery flies past the Space Needle and downtown Seattle.

 747-8 team implemented and certified comprehensive design changes that allow the 747-8 Intercontinental to carry fuel in the horizontal stabilizer, providing enhanced range and payload capability.

767

 Assembly begins on the fourth and final KC-46 Pegasus test airplane for the U.S. Air Force’s next-generation aerial refueling tanker program. The tanker uses the platform of the 767.

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Boeing remains on plan to deliver the initial 18 combat-ready KC-46 tankers to the U.S. Air Force by 2017.

 Everett factory receives the first Pratt & Whitney PW4062 engines for the first KC-46 Pegasus test aircraft.

 KC-46 Pegasus test aircraft achieves “power on,” plugging into an external power cart and bringing power into each segment of the electrical system.

777

 Boeing announces plans in February to build a composite wing center north of the factory in Everett to support fabrication of the 777X composite wing.

 High-speed wind tunnel tests for the 777X begin at Boeing’s Transonic Wind Tunnel in Seattle, following wind tunnel tests at QinetiQ’s facility in Farnborough, UK.

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777X wind tunnel tests get underway in Seattle.

 All Nippon Airways (ANA) announces its selection of 20 777-9X and six 777-300ER (Extended Range) airplanes.

 China Southern Airlines receives the first of 10 777-300ER (Extended Range) airplanes.

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China Southern takes home its first 777-300ER.

 Turkmenistan Airlines takes delivery of the first of two 777-200LR (Longer Range) airplanes ordered in 2011.

 777 wins numerous awards including Best Aircraft Type for 2013 (Global Traveler, Premier Traveler, Business Traveler USA and Executive Travel magazines).

787

 Boeing rolls out its first 787 Dreamliner built at the rate of 10 per month. The airplane, a 787-8 and the 155th Dreamliner built, was later delivered to International Lease Finance Corp. for operation by Aeromexico.

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The first 787 at the increased rate of 10 airplanes per month rolls out of the Everett factory.

 Boeing flies the 787-9 to Auckland, home of launch customer Air New Zealand. The flight — 13 hours 49 minutes — marks the 787-9’s international debut and its longest flight since testing began in September.

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The second of three 787-9s dedicated to the flight test program, ZB002, arrives in Auckland, New Zealand.

 ANA announces its intent to purchase 14 787-9s.

 Kenya Airways takes delivery of its first 787.

8,000 delivered

A little over two years ago, I was talking about the delivery of the 7,000th 737. Today, we’re already marking the 8,000th delivery— something that has never been done in the history of commercial airplanes.

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The 8,000th 737 to be delivered heads for Boeing Field. Jim Anderson photo.

United Airlines took home this beauty, a Next-Generation 737-900ER with a special logo to mark the milestone airplane.

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A special logo marks the 8,000th 737 to be delivered. Jim Anderson photo.

737 deliveries don’t show any signs of slowing down. Orders for the Next-Generation 737 and the new 737 MAX keep coming in as we continue to make the airplane more fuel efficient, with new features like the Boeing Sky Interior that our customers can build their fleet on in the years to come.

With an impressive backlog of more than 3,700 airplanes on order, including 1,934 orders for the new 737 MAX, the 737 program is busy making sure these airplanes get to our customers as soon as possible.

The team in Renton took time this week to not only celebrate the 8,000th delivery, but to also mark production increasing to 42 airplanes per month.

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737 employees gather in the Renton factory to mark the milestone delivery and production rate increase. Jim Anderson photo.

United Airlines took part in the event, as their vice president of fleet Ron Baur thanked our employees and recognized some of the employee involvement team members.

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737 employee involvement teams are recognized during a special event in Renton. Marian Lockhart photo.

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Employees from Boeing Fabrication across the globe celebrate in Renton. Jim Anderson photo.

Thanks to United and all of our 737 customers for helping us reach the 8,000 milestone. We’re already counting the days to 9,000! I’ll end with a look back at our other 737 milestone deliveries.

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7000th delivery: December 2011, flydubai, 737-800.

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6000th delivery: April 2009, ILFC (for Norwegian Air Shuttle), 737-800.

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5000th delivery: February 2006, Southwest, 737-700.

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4000th delivery: June 2001, Air Algerie, 737-800. (we have no photo of the actual airplane. This photo shows a 737 delivered to Air Algerie in July of 2001)

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3000th delivery: February 1998, Alaska, 737-400.

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2000th delivery: February 1991, Lufthansa, 737-500.

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1000th delivery: December 1983, Delta, 737-200.

The Dreamliner effect

We’re always proud and excited to see our customers take home their first 787. Kenya Airways took delivery of their first Dreamliner last week. That’s 18 customers and counting.

Of course, we’re just as proud to hear positive feedback from customers that are already flying the 787. LOT Polish Airlines recently credited what it calls the “Dreamliner effect” for directly contributing to a net profit for the first time in five years.

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When announcing its 2013 financial results, LOT said that thanks to the 787— the airline gained as much as PLN 95 million (Polish zloty). Their news release speaks to the benefits of the airplane.

“All in all, thanks to the Dreamliner, the number of the business and premium class passengers in 2013 increased by over 80 percent compared to 2012. The Boeing 787 offers greater business opportunities in terms of cargo carriage. Furthermore, because long-haul flights (New York, Chicago, Toronto, Beijing) were operated with the Dreamliner, LOT saved several million of PLN on the reduced fuel consumption.”

These real world results are exactly what we had in mind when we designed and built the 787. And we thank our customers for sharing them.

Dark and stormy

It was fitting that we picked a dark and stormy night in Everett to debut the first 787-9 to be delivered to Air New Zealand. In fact, the airplane’s distinctive black color scheme looked downright gorgeous in the pouring rain.

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The first 787-9 to be delivered to launch customer Air New Zealand rolls out of the paint hangar in Everett late Saturday night. All photos by Gail Hanusa.

Air New Zealand plans to have the airplane begin service on its Auckland-Perth route later this year. The airline has 10 787-9s on order.

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Tipping point

The new single-aisle order trend is tipping toward the 737 MAX, which since its first order has claimed more than 50 percent of new single-aisle orders placed versus the neo.

The airplane is proving to be popular not only with current 737 customers, but with new customers as well. Today, Air Canada finalized an order for 61 737 MAXs, bringing total MAX orders to 1,934.

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Thanks to Air Canada for their 737 MAX order.

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Air Canada has invested in 33 MAX 8s and 28 MAX 9s to replace its current all Airbus single-aisle fleet. While we often talk about the advantages of the 737 MAX 8, because it lies in the heart of the single-aisle market, this investment by our customer points to the value the MAX 9 offers.

Carrying 31 more seats than the 737 MAX 8 in a single-class configuration, the MAX 9 offers the best fuel efficiency per seat and lowest seat-mile cost in the family. In comparing it in a two-class configuration to the A321neo, the 737 MAX 9 is 6 percent lighter and costs 7 percent less to operate per trip no matter how far you fly, thus providing the most cost efficient option to the marketplace.

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The 737 MAX 9.

Other customers like Aeromexico, Alaska, Icelandair, United, Lion Air, Turkish, TUI and lessors such as ALC, ACG and Avolon have also invested in the value the MAX 9 can bring to their fleet. To date, 12 customers have placed a total of 281 MAX 9 orders. And we expect this number to continue to grow as customers exercise options and conversion rights and new customers order the airplane.

Going forward, we expect the new single-aisle order trend to continue toward the MAX.

 

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