subject: Boeing Takes Off [print this page] Boeing Takes Off Boeing Takes Off
If there is one industry which knows all about manufacturing insurance, then it's the aircraft industry and one of its biggest players has just announced that it has just bounced back into profit.
The US based Boeing which will have some of the most comprehensive manufacturing insurance policies in existence is the world's biggest maker of aircraft, commercial and military, and has just released figures for the three months to September 2010, showing a net income of 531 million.
This is compared to a staggering loss of just over one billion for the same period last year. But manufacturer insurance premiums were not to blame for the huge loss, as delays to new aircraft were mostly behind the poor figures. And this came down to Boeing's new flagship airliner the 787 which is also known as the Dreamliner. Representing the latest in aircraft technology, the 787 is roughly two years behind schedule and caused Boeing to levy a one-off charge on its accounts.
Whether Boeing has had to invoke clauses within its manufacturer insurance policy remains to be seen, but the worse is said to be now over and a total of 221 plane orders (across the whole range) were ordered in the period.
The first Dreamliner to earn its owners some money will fly in Japan's All Nippon Airlines fleet and is set to begin service in early 2011.
Overall the Boeing commercial order book remains at healthy figures, with firm orders for nearly 3,500 aircraft. These are worth a whopping $255 billion. And of those, nearly 900 are for the Dreamliner.
Revenues for the commercial division climbed 11% to $8.7 billion, although the defence division which like others is feeling the effects of reduced military spending across the globe did less well, with revenues dropping by 6% to $8.2 billion.
That Boeing has managed to announce some excellent figures for its commercial division will delight investment analysts and fund managers across the globe, but others will remain disappointed that they dropped the ball' when it came to the introduction of the Dreamliner. Boeing has built up somewhat of a reputation for successful plane launches such as the well received 777 which greatly added to the company's fortunes. But the 787 delays has damaged reputations, as well as the bottom line.
Manufacturing insurance plays a key part in such company's commercial activities, but of course most of the details are wrapped in commercial confidentiality and do not see the light of day.
The 787 hit turbulence because it represents a radical change in the manufacture of airliners, with mostly composite materials (not the traditional aluminium) being used in its construction. This will make it a super fuel efficient mid ranged aircraft and worldwide airlines are awaiting its introduction with some anticipation.
