The Paris Show has brought in big orders for
The Boeing Company
). With the launch of the 787-10 version of its flagship
Dreamliner aircraft, the company has in total received 102 firm
orders for this version from five different airlines worth $30
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United Continental Holdings, Inc.
) became the launch customer with 20 firm orders. These include
10 new orders while the remaining 10 comprise conversion orders
from the 787-9 model. We note that the first flight for 787-9 is
slated for late 2013.
The company received 30 orders each from Singapore Airlines and
Air Lease Corporation
), 12 orders from British Airways, and 10 orders from GE Capital
Aviation Services, a subsidiary of
General Electric Company
Boeing indicated that it has begun designing the plane and
expects final assembly and flight test to begin in 2017. First
delivery is scheduled for 2018.
This version of the Dreamliner is 15% larger in capacity compared
to 787-8 and 787-9 (yet to be launched) and has a carrying
capacity of up to 330 passengers. With the same fuel-efficient
carbon-composite materials, the 787-10 can fly up to 7,000
nautical miles. Also, the aircraft is 25% more fuel efficient
compared to its predecessors.
The second day of the Paris show brought in more orders for fuel
efficient passenger jets, including single-aisled as well as
wide-bodied jets. Other orders for Boeing include 3 firm orders
from Air Lease Corp. for 787-9, 2 firm orders from Qatar Airways
for 777-300 extended range ("ER"), 4 commitments from SkyMark
Airlines for 737 MAX and 7 commitments from Qatar Airways for
These multi-billion dollar orders would act as a catalyst to
growth. Despite the battery issue related to 787-8 that resulted
in the grounding of the aircraft, Boeing is flooded with orders
because of the sheer fact that its aircrafts are more fuel
efficient. This not only reduces cost per mile but also cuts
pollution levels. Moreover, these aircrafts are right-sized for
many long-haul markets. Going forward, with new plane program
announcements, we expect the company to receive more and more
However, like other major defense contractors, the company
continues to face the adverse effects of sequestration and
domestic budget cuts. The company presently retains a short-term
Zacks Rank #3 (Hold).