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Boeing CEO says 787 freighter remains strong candidate to succeed 767F

Calhoun says air cargo market will continue to flourish after pandemic boom wanes

(UPDATED: 1:13 P.M. EST)

WASHINGTON — Boeing CEO David Calhoun suggested Thursday the aerospace manufacturer is leaning toward developing a freighter version of its 787 Dreamliner as a replacement for the 767 freighter and said the cargo market is on a strong upward trajectory that will boost sales of all-cargo aircraft well into the future.

Boeing (NYSE: BA) must terminate production of the popular 767 and 777 freighters at the end of 2027 to comply with global emissions rules. The company recently launched the 777-X program as the next generation successor to the large 777, but has nothing in place for the medium widebody category. Boeing has 43 firm commitments for the 777-8 freighter since it went on sale nine months ago, plus options for 16 more.

In a brief interview, Calhoun said the 787 is high on the list of candidates for the next cargo jet, although officials stress the company continues to work toward a decision and that multiple scenarios are in play.

“We know there’s value in it [a 787 freighter]. But we’re going to pace all of our freighter developments,” he said on the sidelines of the U.S. Chamber of Commerce’s aerospace summit in Washington. “We have a 777 coming down the pike. The [legacy] 767 is still in wild demand. Someday. Probably likely. But we have not pulled any triggers.”

Bloomberg reported in July that a 787 freighter is one option Boeing is considering. The Arlington, Virginia-headquartered company is also weighing development of a completely new freighter airframe, referred to as the New Midmarket Airplane (NMA), that would be followed by a passenger variant, according to Leeham News and Analysis (LNA). 

Calhoun scrapped the twin-aisle passenger concept of the after taking the helm two and a half years ago and reiterated in the brief interview, “There is no NMA.”

A composite fuselage poses challenges for freighter construction, especially with barrel sections used by Boeing in the 787 passenger jet. The frame around a cargo door can be damaged during loading of heavy containers and requires special reinforcement compared to traditional aluminum structures, experts say. Damage can be hard to see with composite materials, veteran aerospace journalist and LNA managing editor Scott Hamilton explained.

“How do you repair it? With metal you patch it,” he said. Another problem is the 787’s larger size relative to the 767’s footprint, which means express carriers could accommodate fewer cargo jets on the ramp at the same time.

By contrast, Airbus composite aircraft are made with connecting panels, making them easier to repair. 

Boeing in August began delivering 787s again after a 14-month pause to correct production flaws for lack of flatness in the fuselage skin and gaps between composite sections.

Boeing typically factors in the prospect of a freighter in original design of planes it develops.

The manufacturer will not push against International Civil Aviation Organization rules on noise and emission rules requiring newly registered aircraft to meet international standards by Jan. 2, 2028, Calhoun said in an impromptu session with reporters.

His statement doesn’t rule out the possibility of seeking an accommodation with U.S. aviation regulators to allow more transition time.

And development of a new freighter could also be influenced by continued strong demand for 767 passenger-to-freighter conversions.

Boeing had record orders in 2021 for new and converted freighters, including 737-800 conversions, and 767 and 777 production freighters. UPS in late August placed an order for eight more 767-300 factory-built freighters.

“We continue to work with stakeholders to determine the best outcome” for the 767, spokeswoman Jessica Kowal said.

Boeing bullish on cargo

During a fireside chat at the event, Calhoun said cargo volumes will return to their normal pace of growth following record demand spurred by COVID’s disruption of supply chains and consumer spending patterns. But cargo will maintain its share of the freight market, he insisted.

“I don’t think there will be a giveback … to some other form of transportation. I think they are going to keep what they have. I don’t think it can accelerate at the same pace it did, but even if it returned to its pre-COVID pace it’s going to be a very healthy, very robust market,” the Boeing chief said.

“Time-sensitive freight, time-sensitive anything relies on air. And that part of the world is growing and growing. I think that’s pretty secular in terms of a trend,” said Calhoun. “I don’t think it will be quite as robust as the last couple of years” when all-cargo aircraft were essential because airlines parked most passenger aircraft.

Boeing projected compound annual growth of 4.1% per year for  air cargo over the next 18 years, an uptick of one-tenth of a point from last year’s report, based on expected growth in GDP, industrial production, global trade and e-commerce. The 10-year outlook envisions 4.3% growth.

“Boeing has a great position in freight. We love it. We have a road map to continue to support it in a pretty aggressive way,” Calhoun told a packed audience. “So I’m pretty bullish on it.”

Remarketing 737 MAX intended for China

In the scrum with reporters, Calhoun said Boeing is finding new buyers for some 737 MAX jets slated for Chinese airlines because China’s aviation authority has not approved the planes to fly following two deadly crashes. The remarketing effort is intended to reduce Boeing’s backlog of undelivered planes and increase cash flow. 

Boeing officials say ongoing political tensions between China and the U.S. and strict COVID policies have stalled China’s certification of the MAX, which was grounded worldwide for more than a year while Boeing made changes to the plane. 

“We are not delivering planes to China. We wish we could. We are remarketing a portion of them and we continue to defer production of Chinese airplanes,” the former GE executive said. “So we don’t really carry any risk on that front. And depending on what we read we’ll keep remarketing more.”

Boeing said in July it had 290 undelivered planes, and about half of them are designated for Chinese carriers.

On stage, Calhoun said China likely won’t remove roadblocks in the next year or two, but added he thinks Boeing will return to the Chinese market at some point.

Federal Aviation Administration certification of the MAX 7, the smallest of the type, is expected by the end of the year, which should free up final review of the MAX 10 since the planes share a great deal of the documentation.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

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2 Comments

  1. The 787 would be the perfect replacement of the 767 Freighter.
    The worst mistake is ending production of the 747-8F. It could carry outsize cargo like small civilian helicopters like the Bell 505 JetRanger and freight companies love them. The engines could be updated for new regulations. Nothing, not even the new 777 Freighter can touch the 747.

    1. Respectfully, The 747-8F wasnt selling. The market spoke. The real story in the 747 production ending was that the forward fuselage segment vendor was unwilling to build parts into the future and exited that business line. Relocation of that line to another facility was expensive and in the face of very slow sales, the program was closed……

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Eric Kulisch

Eric is the Supply Chain and Air Cargo Editor at FreightWaves. An award-winning business journalist with extensive experience covering the logistics sector, Eric spent nearly two years as the Washington, D.C., correspondent for Automotive News, where he focused on regulatory and policy issues surrounding autonomous vehicles, mobility, fuel economy and safety. He has won two regional Gold Medals from the American Society of Business Publication Editors for government coverage and news analysis, and was voted best for feature writing and commentary in the Trade/Newsletter category by the D.C. Chapter of the Society of Professional Journalists. As associate editor at American Shipper Magazine for more than a decade, he wrote about trade, freight transportation and supply chains. Eric is based in Portland, Oregon. He can be reached for comments and tips at ekulisch@freightwaves.com