The COVID-19 pandemic, which has financially devastated the world’s airlines, is also damaging the world’s jet builders, including Boeing.
Though Boeing has some recent good business news in being allowed to deliver new 737 MAX jets to airlines after a 20-month grounding, international jet travel remains down around 85% -- that has severely hurt the company’s bigger twin-aisle jets built at the company’s massive factory complex in Everett.
Among their cost-driven decisions, Boeing announced it would consolidate all 787 Dreamliner production in North Charleston, South Carolina -- instead of keeping some production in Everett.
On Tuesday, KING 5's Glenn Farley moderated a panel discussion of three of the nation’s top aerospace analysts: Ron Epstein, Senior Equity Analyst at Bank of America Merrill Lynch; Kevin Michaels, managing director of AeroDynamic, a specialized consulting firm focused on aerospace around the world; and Richard Aboulafia, Vice President of Analysis at the Teal Group in Fairfax, Virginia, who had also prepared the 2018 and 2019 Aerospace Competitive Economics Study looking at state competitiveness.
Their biggest takeaway was Boeing’s need to build an all-new jet to fill a gap in its product lineup between the 787 and the 737, a gap being exploited by the Airbus A321 NEO.
The analysts said Boeing seems to have shelved, for now, its idea to build a so-called “medium market airplane” (MMA), or “new midsized airplane” (NMA). But they say it’s needed, and potentially could fill up the soon-to-be empty spaces inside the world’s largest building in Everett. The Boeing 747 is also due to be retired in 2022 -- if Boeing even decides to build it there.
“When this airplane gets launched; when could it get launched?" asked Epstein. "Is it this year? Probably not. Is it next year? Probably not. Maybe a year after that, and then when does that activity heat up?”
But none of the analysts believes Boeing could make a business case to reestablish a 787 assembly line in Everett.
One thing that Everett has going for it is a massive new factory which builds the composite wings for the new 777X. But the analysts also feel a new plane would need to be built around a new set of engines, be that a geared turbo fan or something that breaks the traditional mold of a jet airliner engine. That could take years.
Michaels feels Boeing's future could also see more heavy work built closer to final assembly like the 777X wing factory, and that critical mass could be a good sign for Everett.