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Fri February 4, 2011
No end of the line for Boeing 767?
The future might be a bit brighter for aerospace workers in the Puget Sound region. Boeing Commercial Airplanes chief Jim Albaugh says the company can still find customers for its wide-body 767. He says the line won't be shut down, even if Boeing doesn't win the competition to build refueling tankers for the U.S. Air Force.
Change in stance
Over the past decade, locals have heard the message again and again: if Boeing doesn't win a multi-billion dollar contract to build refueling tankers for the Air Force, the 767 production line will shut down. Now, the head of the commercial airline division, Jim Albaugh, says that's not so. He thinks the 767 still has a future as an airliner.
This about-face has got some analysts scratching their heads, including aviation analyst Richard Aboulafia:
"You have to say that kind of thing to express confidence in the product, but the likelihood that commercial customers will actually still be signing up in ten years? Extremely minimal," says Aboulafia.
He notes Boeing has sold only ten 767s in the last two years, half of them as heavily discounted replacements for 787 Dreamliners that are overdue.
At the same time, Airbus is selling about ten times as many A-330s. Aboulafia thinks Albaugh is trying to keep confidence up as the company angles for the tanker contract.
10 more years for the production line?
Meanwhile, aviation consultant Scott Hamilton says if Boeing makes a number of improvements to get the fuel burn rate down on the 767 and continues to heavily discount its price, airlines might order enough to keep the line open another decade.
"By the time you do all that, maybe you’re in a position where you can offer a more fuel efficient airplane at a sharply lower cost. And that could extent the line for a while," says Hamilton.
Boeing recently moved the 767 line within the factory in Everett and retooled it for leaner production. At a formal ceremony unveiling the new line, Albaugh said they wouldn't invest so much in the jet if they didn't believe in its future.
It also allows them to put a lower price tag on their bid for the Air Force tankers, which would create thousands of jobs and keep the line open for several decades.
Boeing says it's submitting its final proposal to the military next Friday.