Boeing cuts jet production as economy hurts airlines

Boeing Co., the world's second- largest commercial-jet builder, said it will cut production of its largest models next year as the global recession hurts business at airlines and cargo carriers.

Monthly production of the twin-aisle 777 will drop to five from seven beginning in June 2010 and plans to increase output of the new 747-8 jumbo jet and the 767 will be delayed, Chicago- based Boeing said in a statement today. The Chicago-based company is keeping production steady for the single-aisle 737, the world's most widely flown plane.

The production decisions and weaker-than-projected pricing will hurt first-quarter 2009 earnings by about 38 cents a share, Boeing added.

The planemaker had said as recently as last month that it would increase deliveries to 480 to 485 aircraft this year, with production remaining stable through at least mid-2010. The company was studying rates for next year as financing for airlines dried up, leading to dropped and deferred orders. The number of cancellations exceeded new orders in the first quarter.

Boeing fell $1.15, or 3 percent, to $38 at 4:34 p.m. in trading after the close of the New York Stock Exchange.