Boeing Remains Optimistic About Finalising JV With Embraer

Transcript

James McBride:We're, as you know, we've signed an MOU with Embraer to form a joint venture, Boeing and Embraer, for the commercial and support services side of the Embraer business. Yeah, 80/20 joint venture. We're very optimistic that it will be approved. We've talked to the government officials. We're very optimistic that it will be approved. We're planning integration activities as we speak, so we're looking at opportunities to make more synergy. We think it's a win-win for both companies and for customers. Obviously, there's the product side that fits really well, and then there's opportunities for us to bring some of the lean design that Embraer is so good at and their vertical integration, which is a key part of our strategy going forward. So we think it works well for both parties, and we think it'll ultimately be approved. I love talking about the Max. It's, as you may know, it's the fastest-selling airplane in the history of the Boeing Company with almost 4,700 orders through July. We've delivered 174 Maxes around the world, 100 this year through July. It offers substantial improvements in economics and in range to our customers. We'll see it in markets such as, as an example, GOL has announced Fortaleza and Brasilia to Miami with 186 seats in a MAX 8, a market that they had abandoned several years ago. And now the MAX, they believe and we believe, offers CASC that allows them to compete in a very competitive market such as Miami. There's other markets, but I'm not at liberty to say what they are because our customers would not— they're not announced yet. Yeah. So we obviously we do our 20-year forecast. You're probably familiar with our CMO, and we just released it in July. 43,000 airplanes over the next 20 years, about 4.7% RPK growth worldwide. We see this region as growing a little faster, about 6%. Most of the growth intra-region, about 3,000 airplanes will be needed, and almost 90% of those will be single aisles. Okay. And about 80% of those will be growth and not replacement. So I think what will— the vast majority of obviously airplanes delivered in this region will be for growth. There will be a replacement cycle coming, but I think it's still a little bit because of all the NGs and the newer A320ceos. It's probably the replacement cycle's probably just a little further out than maybe in some places. Thank you.

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