Boeing (NYSE:BA) on Friday announced that it will reduce production of its 747-8 airplanes through 2015, citing lower market demand for the large passenger and freighter airplanes.
The Chicago-based airplane maker said it would reduce the 747-8’s production rate from 1.75 airplanes a month to 1.5 airplanes a month.
"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," Eric Lindblad, Boeing ‘s vice president and general manager of the 747 Program, said in a statement.
Citing lower demand, Boeing had adjusted the output of the 747-8 planes from two airplanes a month to 1.75 planes in April. However, Lindblad said that the reduction in the production rate does not undermine the company’s confidence in the four-engine jumbo jet.
"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," Lindblad said.
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Boeing also said the company expects its long-term average growth in the air cargo market to begin rebounding in 2014, and it estimates that the global market for larger airplanes such as the 747-8 will grow to $280 billion over the next 20 years.
The company said that to date it has received 107 orders for the 747-8 passenger and cargo airplanes, and it has delivered 56 airplanes so far.
A 747-8 twin-aisle passenger plane costs $356.9 million, while the 747-8 cargo version is valued at $357.5 million, according to the company's website.
Boeing expects the production adjustment to have no significant impact on its bottom line, and it said the new production rate will take effect beginning early 2014.
Boeing’s shares ended up 0.2 percent at $122.52 on the New York Stock Exchange on Friday.