For the second time this year The Boeing Co. (NYSE: BA) announced Friday that it will cut its production rate for the company’s venerable 747-8 jumbo jet. Production will be cut back to 1.5 planes a month from the previously announced cut in April to 1.75 planes a month. At the beginning of the year Boeing had planned production for the 747-8 at 2 planes a month.
Lower market demand for the planes both as passenger and freight carriers is once more the reason Boeing gives for the cutback. The number of orders for the 747-8 has fallen from 110 in April to 107 currently and Boeing has delivered a total of 56 of the planes to date. As of April’s announcement Boeing said it had delivered 46 747-8s.
A company executive said:
This production adjustment better aligns us with near-term demand while stabilizing our production flow, and better positions the program to offer the 747-8′s compelling economics and performance when the market recovers. Although we are making a small adjustment to our production rate, it doesn’t change our confidence in the 747-8 or our commitment to the program.
The 10 planes delivered since April were built at the original production rate. Deliveries at the new rate are expected to begin next year.
Boeing’s stock is up about 0.1% Friday, at $122.48 after posting a new 52-week high of $122.81 earlier in the day. The 52-week low is $69.30.