Boeing has made a sensible yet emotional call to end production of its hulking 747 jumbo jet, ending a half-century run for the twin-aisle pioneer.
The last 747-8 will roll out of a Seattle-area factory in 2022, the company confirmed overnight, with CEO Dave Calhoun later describing it as an "emotional decision for everyone" at Boeing. "This is just us facing reality," he told CNBC. "Our customers want the new technology."
It comes as airlines around the world are scrapping their remaining Boeing 747 jumbo jets from the -400 series. Qantas sent its last Boeing 747 into retirement last week, after a series of scenic joy flights which afforded fans a final chance to fly on a jet nicknamed the Queen of the Skies.
Earlier this month British Airways announced it would retire all 31 of its Boeing 747s “with immediate effect” owing to the downturn in travel sparked by the coronavirus pandemic, in the wake of similar decisions by KLM and Virgin Atlantic.
The past decade has seen other 747 stalwarts – Singapore Airlines, Cathay Pacific, United Airlines – retire their jumbo jets, usually with fanfare fitting for an aircraft so warmly remembered by travellers.
End of an era
It’s a moment that aviation enthusiasts long have dreaded, signaling the end of the double-decker, four-engine leviathans that shrank the world.
Airbus is already preparing to build the last A380 jumbo, after the final convoy of fuselage segments rumbled to its Toulouse, France, plant last month.
Yet for all their popularity with travelers, the final version of the 747 and Europe’s A380 superjumbo never caught on commercially as airlines turned to twin-engine aircraft for long-range flights.
Boeing’s 'Queen of the Skies' debuted in 1970, an audacious bet that transformed travel but almost bankrupted the company.
Passenger versions boasted a spiral staircase to a luxurious upstairs lounge.
Freighter models featured a hinged nose that flipped open to load everything from cars to oil-drilling gear. The 747 went on to rack up 1,571 orders over the decades – second among wide-body jets only to Boeing’s 777.
Europe's response was the Airbus A380, which took the concept of the 747's hump and extended that to a full-length upper deck – which several airlines took advantage of by adding private first class suites, inflight showers, cocktail bars and lounges.
But by the time the 'superjumbo' arrived in 2007, airlines were already tilting to smaller planes that burned less fuel. Boeing correctly anticipated that trend with the twin-engine 777 and the 787 Dreamliner.
With prodding from Joe Sutter, a famed engineer who’d led the original 747 program, the planemaker decided to develop a relatively inexpensive upgrade of the four-engine plane – creating the 747-8 series – to steal sales from the A380.
The strategy would have been successful, had the 747-8 not been bedeviled by early mismanagement, blowing its budget and deadlines, said Richard Aboulafia, an analyst with Teal Group.
The Chicago-based company has lost about US$40 million for each 747 since 2016, when it slowed production to a trickle, making just six jets a year, Jefferies analyst Sheila Kahyaoglu estimated.
From its debut in 2011, Boeing sold only 137 of the 747-8s, and twice as many of those were the 747-8F freighter version than the 747-8I passenger edition.
All told, Boeing has recorded US$4.2 billion in accounting charges for the 747-8, which has been kept alive as a freighter. The 747 notched its last order as a passenger jet in 2017 – for the new Air Force One, set to take wing in the mid-2020s.
But the coronavirus pandemic is hastening the end of the behemoths as people movers.
With travel not expected to fully recover until mid-decade, airlines are culling aging jetliners and four-engine jumbos from fleets to limit spending. About 91% of 747s and 97% of A380s are parked, Credit Suisse estimated last month.
Airbus has just nine of the planes still be delivered. All but one of them are tagged for Emirates, the largest A380 operator, which is considering whether to scrap its final five on order.
The A380 has cost Airbus about US$23 billion, breaking even or generating profits for only a three-year stretch starting in 2015, Agency Partners estimated, suggesting that with just 251 aircraft sold over the program’s life, the planemaker never achieved the efficiency that comes with manufacturing at large scale.
Boeing, meanwhile, had been preparing for years to wind down the 747 program, and its sales team has been sounding out customer interest in a potential freighter version of the 777X.
If such a model goes forward, it would bolster flagging sales of the largest twin-engine aircraft in the company’s lineup.
Additional reporting by David Flynn