Different tactics
The 777X has already captured record orders for this new plane. However, future orders are not sufficient to keep the Boeing aircraft manufacturer going, The Company’s production lines have to be kept in motion and must generate cash for the company. This also means that Boeing has to be able to convince its customers, existing and new, to buy the current 777 version aircraft at least for the next 6 years, despite the fact that they will be outmoded very soon.
Transitioning from an old aircraft model onto a more technologically-advanced one can be a tricky task. It takes years to develop an aircraft that is substantially upgraded. Boeing has now planned on pairing orders for the 777X with an existing generation jet. Another idea that they might work on is to offer the customers an option of selling the older passenger jets for conversion into cargo aircraft. These can then be replaced with the newly-built jets said Boeing’s VP Sales John Wojick. But the task is not going to be an easy one. Production levels of the 777 will have to be maintained at steady levels.
The competition
The cargo market is stagnant and Boeing’s competitor, Airbus is also launching 2 new long-range models that are stated to be more fuel efficient. One of them is scheduled to be launched at 2014-end and the 2nd will be launched in 2017. These launches will prove to be definite hurdles for Boeing to latch onto additional sales. The company has not currently announced any new orders for Boeing aircraft, either the 777 or the 777X’s. The long-range 777, can seat 300- 380 passengers, and is the company’s best-selling wide-body jet and accounts for a large portion of the company’s profits.
Boeing plans on manufacturing around one hundred 777s annually, or approximately 600 from 2014 to 2020. The company ended 2013 with 380 Boeing 777s on order. It has also announced 280 additional orders & commitments for its 777X, but the 1st won't be delivered up until 2020. Wojick also stated that all of their models are almost sold out until 2022.
The orders have to be booked well in advance as that is the only way the manufacturer can be confident about future profits. It’s a balancing act that Boeing will have to get right. Jim McNerney, the company’s Chief Executive Officer is confident that the company will be able to move seamlessly from its development phase onto the production phase and launch the aircraft as planned. It looks like the company has got a handle on everything at the moment and will go great guns with its Boeing aircraft 777X plan.