Orders Have Dried Up Over Recent Years In Favor Of More Efficient Airplanes

The Boeing 747 is an icon. Instantly recognizable even from a distance. It is also one of the very few four-engine airliners flying today ... and its fate is uncertain.

Airlines have been ordering newer, more efficient two-engine airplanes that fly further on less fuel than the 747, including Boeing's own 777. Boeing has netted only two sales for the 747 in 2015, which was a repeat of 2014. Even its role as a Presidential transport has run into Congressional questions about the budget for replacing the 25-year-old 747s that fly as Air Force One with the newest variant, even though the law requires Air Force One to be a four-engine jet. The only other option from the airliner realm would be the A380. That might not be politically palatable, and Airbus has expressed no interest in converting one of its super jumbos.

Randy Tinseth, Boeing's vice president for Marketing, told MSN that the market for the 747 is a tough one. "I don't want to sugarcoat this," he said. It has been a tough market. It continues to be a tough market. We have some near-term opportunities. We also have airplanes we need to sell."

Some of those sales may come from Russia. A freight company there reportedly has plans to buy 18 of the jumbo cargo airplanes over the next few years. But the deal is dependant on financing, which analysts say will not be easy to obtain. With the cargo segment down overall, sales of cargo airplanes have slumped as well.

Boeing's backlog for 747s, including its new Intercontinental model, would keep the production line open for another 18 months or so, according to the report. But if they close the production line, Boeing would have to walk away from about $1.89 billion in deferred costs for the development of the latest variant.

The Russian financing may be less tricky now that Congress has reauthorized the Export-Import Bank. But Boeing has two 747s to sell that had been built for the now-defunct TransAero Airlines. Aerospace consultant Richard Aboulafia told MSN that once the Air Force One airplanes are built, Boeing will be forced to cut production of the airplanes or end it entirely.

Tinseth said that the long-term future of the 747 is "tied to what we see in the cargo market." Boeing anticipates that as many as 250 large cargo airplanes will be needed over the next five to 10 years as companies like UPS upgrade their fleets. "As long as demand is there, and demand makes sense from a production point of view, we'll keep building the airplane," Tinseth said.

But Aboulafia said that no commercial jet has been sustainable with a cargo-only model. "Programs with backlogs like these don't survive very long," he said.

(Images from file)

FMI: www.boeing.com