Specialist
Former VP at The Boeing Co
Agenda
- Commercial aerospace recovery and Boeing’s (NYSE: BA) competitive positioning vs Airbus (PAR: AIR)
- 737 Max production and delivery targets, highlighting recertification in China and reputational impacts on competition with A320/A321
- Product mix and cost analysis related to 787 Dreamliner production problems, plus efforts to mend FAA (Federal Aviation Administration) relationship
- Pricing dynamics and outlook as industry recovery and production ramp-up continues – how could the global fleet change post-coronavirus?
Questions
1.
What’s your sense of the recovery pace in the commercial aerospace industry? How does it differ by region given traffic levels?
2.
What’s your take on deliveries for Boeing in the recovery period? How many has it been able to make towards the end of 2021 given it reached around 85 in Q3 2021, which was up from previous quarters?
3.
How important is approval of the 737 Max in China to this particular programme? You suggested an uplift on the significant backlog there. How significant is this to Boeing’s overall recovery and the programme’s specific outlook?
4.
How do you assess Boeing’s positioning in China vs Airbus and Comac given the long recertification process? Has it struggled due to its length?
5.
Boeing is targeting a production rate of 31 aircraft per month for the 737 Max by early 2022. How do you evaluate this rate and the underlying demand given the recertification and recovery pace you’re observing? How achievable is this rate given the supply chain difficulties as the aerospace industry ramps up?
6.
What is a feasible number of 737 Max deliveries for 2022? Quite a few are in inventory, and I believe around 370 are to be delivered between 2022 and 2023.
7.
Could you discuss the competitive line-up between the Max and A320/A321? Obviously, Airbus has a much more aggressive production ramp schedule, but what headwinds are you referring to for the Max specifically?
8.
On what timeline could downward pressure begin on 737 Max orders due to the headwinds? How would you expect them to manifest as more direct challenges to Boeing over the next few years?
9.
Could you outline the 787 problems that Boeing is working through with the FAA [Federal Aviation Administration] as inspections continue? How is Boeing trying to solve the issues?
10.
How should Boeing try to mend its relationship with the FAA in the near term? There’s obviously some need to realign the processes and have more structure. How do you assess the relationship today and how could Boeing attempt to smooth out the difficulties?
11.
On what timeline could the 787s in inventory be delivered once deliveries restart? How is Boeing managing those planes? What are the costs of keeping them and subsequently moving them to be ready to deliver?
12.
You touched on leasing companies, but what are your thoughts on underlying demand for the 787, especially given the slower recovery in long-haul commercial air travel?
13.
I think Boeing is targeting 2023 for first deliveries of the 777X. What’s your confidence on its ability to achieve this timeline? Do you have any delay concerns?
14.
What’s your take on Airbus’ freighter derivative, the A350, given you mentioned stronger freighter demand? How could this aircraft affect the market and Boeing’s outlook for wide-body freighters?
15.
What milestones will you be tracking to assess progress on the targeted delivery timelines for the 777X and 787?
16.
How has market pricing developed during the recovery period? I know you mentioned some pricing pressure and market impacts in narrow-bodies. Has average pricing been materially higher or lower vs pre pandemic?
17.
How could the global fleet change in the mid-term compared to pre-pandemic, factoring in sustainability trends, the narrow-body emphasis and the competitive dynamics between Airbus and Boeing? Do you expect a significant composition change?
18.
How could Boeing be impacted by the dynamics you discussed over the next few years, including the global services branch?
19.
Are there any points we’ve touched on or missed that you’d like to highlight before we conclude?
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