A Bonanza for Boeing

Once upon a time, Boeing (NYSE: BA  ) boasted that its 787 Dreamliner aircraft was "the most successful launch of a new commercial airplane in Boeing's history." Years of delays, disappointments, and a series of PR flubs have taken some of the wind out of the company's sails (and sales). But even if the 787 is no longer a success story, Boeing's 737 Next Gen airplane could be.

Yesterday, Boeing confirmed that delivered a whopping 124 planes to its customers last quarter, 11 more than the comparable quarter last year. Wait, it gets better: Last week, Boeing received 104 more orders for planes, with all disclosed orders going to 737's.

No, that's not a typo
That's right, Fools. One week of plane sales nearly equaled three months' worth of planes delivered. Customers from Xiamen Airlines to Air Lease Corp are lining up and begging Boeing to provide them with 737s. I'm tempted to say the planes are selling like hotcakes ... but no one orders 60 hotcakes in one sitting, as Air Lease Corp did with 737s.

Moreover, it looks like things will only get better for Boeing. One of its biggest customers -- discount carrier Southwest Airlines (NYSE: LUV  ) -- recently tied the knot with another of Boeing's bigger fans, fellow cheap-seater AirTran (NYSE: AAI  ) . The pressing need to produce promised synergies post-merger should keep both carriers laser-focused on reducing costs by maintaining an all-Boeing fleet.

And that's just for starters. Recent sales wins in Russia helped push Boeing to accelerate production on the 737 three times in last five months. Suppliers of parts for the plane -- everybody from General Electric (NYSE: GE  ) to United Technologies (NYSE: UTX  ) to Honeywell (NYSE: HON  ) -- have to be giddy with glee over the plane's success.

Foolish takeaway
Even I'm beginning to question Wall Street's predictions of single-digit growth at Boeing. I mean, if Boeing's latest production uptick has it building planes 20% faster than it thought it needed to just a few months ago, how likely is it that sales will remain stuck at 9%?

Even if the 737 is only Boeing's second-biggest success story, it deserves a bigger number than that.

True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community.

Southwest Airlines is a Motley Fool Stock Advisor recommendation, but Fool contributor Rich Smith does not own shares of any company named above. The Motley Fool has a disclosure policy.


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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 08, 2010, at 9:01 PM, boing757 wrote:

    I work on the 737 assembly line and we are so much more efficient than we were 5 or 6 years ago the company is supporting all the programs with the profit that their making on the 737 line.There is a good probablity that we will go to a rate of 42, thats not a typo 42 737's a month by Jan. 2012.For me Boeing is a buy.

  • Report this Comment On October 08, 2010, at 10:01 PM, MurphyMacdotCom wrote:

    I've been long on Boeing since 1999. Haven't exactly made a ton from the position. But maybe with the 787 and the next 737 things will improve.

    I'm interested in what percentage of Boeing's margins come from commercial airplanes. I think I've read it's not the driving force for BA.

    You have a section heading "No, that's not a typo" - with a typo in the section. And another in the previous section. That's kind of funny. Or foolish or something.

    "Yesterday, Boeing confirmed that delivered a whopping 124 planes to its customers last quarter,"

    "...helped push Boeing to accelerate production on the 737 three times in last five months. "

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