7-year backlog ‘too much,’ Boeing executive says

The Boeing Co. is holding its annual investor conference today in St. Louis.

Here are a few highlights from the event, which is being webcast.

Backlog

“Seven years of backlog is just too much,” said Jim Albaugh, president of Boeing Commercial Airplanes. “It drives our good customers to go and look at other alternatives, which we don’t want them to do.”

777

“If the market tells us it wants say 10 a month, I don’t think the (additional capital investment) would stand in the way at all,” said Jim McNerney, CEO of the Boeing Co.

“We think the 777 market will continue to be reasonably robust,” Albaugh said.

787

“We’re going to be relentlessly focused on (improving 787) profitability,” said Greg Smith, Boeing chief financial officer. Boeing “aspires to get to 777 profitability levels on the 787.”

Boeing is actively managing two 787 suppliers, Albaugh said.

The company needs to add an additional aft body production line in North Charleston as well as an additional automated drilling machine there, Albaugh said.

The first 787 built in South Carolina could fly by the end of this week, Albaugh said.

737 MAX

“We are not going to let Airbus position themselves where they have a disproportionate market share (with the NEO),” Albaugh said.

To avoid that, Boeing needs to try to steal away a few of Airbus’s narrowbody customers.

“It hasn’t been lost on us that we need to go play in their sandbox, too,” Albaugh said.

747-8

“We need some orders on this airplane,” Albaugh said.

“We’ve got quite a number of (order) campaigns. … I think we’ll announce some orders in the near term,” Albaugh said.

Future jet production

Boeing will continue “opening up capacity, diversifying risk … so that we can satisfy our customers on an ongoing basis,” McNerney said.

Boeing will diversify production “further from where we are today,” McNerney said.

Boeing has eight production increases planned for its jet programs through 2014, Albaugh said.

“Right now there’s plenty of work for everybody — work in South Carolina, work in Renton, work in Everett,” Albaugh said. “What I worry about are we going to have enough space?”

767-based tanker

Progress on the KC-46A tanker has been going exceptionally well, said Dennis Muilenburg. “Our confidence continues to grow in the execution of the tanker contract,” he said.