Tempting as it is to gloat over Boeing’s troubles of late, when it comes down to it it’s not really a laughing matter. As this article points out, Boeing may have shot itself in the foot (both feet? a centipede’s worth of feet?), but that doesn’t change the fact that their woes have a big impact on the rest of the economy.
Of course, dropping the 767 doesn’t necessarily leave Boeing with a hole in its menu. The company has many overlapping products that it could offer in place of the 767. For instance, in terms of passengers, the 757 product line and the new 7E7 matche most of the 767’s capacity, with the 737-900 picking up the slack at the low end, and the 777-200 covering the higher end. In terms of take-off weight (which I took as a relative measure of cargo capacity), the 7E7 again matches the 767, though the other product lines are significantly higher or lower — not much alternative there. And in terms of range, the 777-200 and -300 have ranges in the same class as 767. I’m not a market analyst by any stretch, but it strikes me that whatever attribute you’re interested in in a 767 model, there’s another model that does much the same. Granted, cost is also a big factor, but all but the 777 models cost less than 767 models (I didn’t look at 747s as substitutes, and there was no price info on the 7E7).
So, could Boeing live without the 767? It could still meet its customers’ needs, yes, but unless it has already reached the break-even point in 767 sales, closing the line might entail a good bit of financial pain. The company could alternatively consolidate its product lines, dropping some of the overlapping 757 and 737 models and finding some means to trim the prices of the relevant 767 models — thereby keeping all of the families in production. But one has to wonder why, when the 767 is struggling, Boeing would introduce an all-new family of jet which directly competes with it in several areas (the 7E7). Yet more overlap, unless they do plan to pare down their catalogue as the Dreamliner enters service.
[Rand Simberg has a more concise and focused post on an overlapping topic.]
[via Carl Carlsson]
FYI
It was announced some time ago that the 757 line will close soon. Not surprising since the larger 737 overlaps.
Also, 7E7 is vaporware at present. I seem to recall it was scheduled to roll out in 2008.
Let’s be frank. If Boeing can’t survive in a world where it is one of two large passenger jet competitors then it shouldn’t exist no matter what the impact on the economy would be. Keeping it alive for the sake of the economy keeps out more worthy competitors and would ultimately cause more damage that it prevents.