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Boeing's 747 Jumbo boosted by US$7.4b order from Russia
[CHICAGO] Boeing Co said it struck a US$7.4 billion deal to sell 747-8 freighters to Russia's Volga-Dnepr Group, providing a much-needed boost to the jumbo-jet program amid flagging demand for four-engine aircraft.
The companies signed a memorandum of understanding that will add 20 cargo variants of the hump-backed 747 to Volga- Dnepr's fleet, Boeing announced today at the Paris Air Show, the aerospace industry's largest trade expo.
The deal with the outsize-cargo specialist would add about 1 1/2 years of work to Boeing's assembly line. That's seen as vital since the current backlog of 32 jets amounts to less than two years of production, a factor that's prompting the company to slow monthly output to 1.3 planes from 1.5 by September.
"We appreciate their confidence in the 747-8 Freighter," Ray Conner, who heads Boeing's commercial airplanes unit, said after announcing the Russian deal.
The Chicago-based company's priciest model reaped no net orders in the whole of 2014, the only annual shutout since it went on sale in 1966. The drought ended when Azerbaijan's Silk Way West Airlines bought three 747-8Fs in March.
Volga-Dnepr already operates 14 freighter versions of the jumbo, including six 747-8s, and said today that the new planes will be used to build out its AirBridgeCargo scheduled freight business. The aircraft will be acquired through a mix of direct purchases and leasing over the next seven years.
The Russian carrier is best known for its fleet of Antonov An-124-100 Ruslan planes. The superjumbos, with a payload of 120 tons and the biggest door dimensions of any cargo model, are used for shipments spanning NASA space rockets through BP oil pipes and concert sets for U2 and Madonna, and under the new accord will also now provide long-term logistics support for Boeing.
Boeing said in its latest global market forecast, issued June 11, that two years of "solid growth" in the air-cargo market are set to continue, brightening sales prospects for all of the company's purpose-built 747, 767 and 777 freighters.
Jim McNerney, Boeing's chief executive officer, said in April that the company had "a pretty good pipeline" of discussions underway on the cargo variant of the 747.
At the same time, the market for the biggest passenger planes is gradually diminishing. The Boeing forecast envisages demand for 540 aircraft seating 400 people or more in the next two decades, 13 per cent fewer than predicted last year.
The 747-8 debuted in 2011 and is the latest variant of the iconic aircraft that opened up intercontinental travel to the mass consumer market in the 1970s and 1980s.