The vice president and general manager of 777X development, Bob Feldman said, “this decision to work with GE going forward reflects the best match to the development program, schedule and airplane performance.”
Boeing worked with Rolls-Royce Holdings Plc and United Technologies Corp’s (UTX) with earlier versions of the 777X plane, but has decided that GE would be the best fit for the newest plane.
The wide body 777 is one of the most successful planes of all time, but now airlines are seeking planes that can accommodate more passengers and use less fuel.
Rolls-Royce is currently the only engine supplier to the Airbus A350-1000, which will compete with Boeing’s future 777X plane.
Boeing is now seeking authorization from its board to begin offering these plans to potential customers. These planes are expected to be used by the end of the decade. Although the company is working to produce these planes, one of its largest customers, International Lease Finance Corp has suggested to BA not to rush the process as they are currently satisfied with their current model and will be until at least the next decade.
Boeing shares were down 78 cents, or -0.90% during premarket trading Monday. The stock has increased 15% in the past year. GE shares were down 28 cents, or -1.19% during premarket trading Monday. The stock has increased 16% in the past year.
The Bottom Line
Shares of The Boeing Company (BA) have a 2.24% yield, based on Friday’s closing price of $86.43.
Shares of General Electric Company (GE) have a 3.24% yield, based on Friday’s closing price of $23.44.
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