Jetrader - September/October 2010 - 45

appraisal

Boeing 777-300ER
Jack Feir President, Jack Feir & Associates Tel: 215 345-9009 JackFeir@aol.com

Background
Launched in 1990 as Boeing’s ﬁrst ﬂy-by-wire commercial jet transport, the 777 program has now been with us for 20 years. When it was launched, the principal competitors were the Airbus A330/340 family and the McDonnell Douglas MD-11. Of those, only the A330 survives to any meaningful degree. The twin-engine 777 neatly ﬁlled the size gap between the 767 family and the 747 family. The 777 family has been produced in two body lengths as the –200 and –300 series, each of which is available in standard and ER (extended-range) versions, making for four main variants. Most recently the –200LR (longer-range) variant was introduced, offering a range capability of about 9,400 nautical miles, which is enough range to connect almost any city-pair on the globe. The sixth, and so far the last, variant is the 777F freighter, based on the 777-200LR platform. As of the end of the ﬁrst half of 2010, the cumulative orders, deliveries and remaining backlogs were as shown in the table below. As with most aircraft programs, in the past two years deliveries have outpaced new orders, so backlogs have been gradually declining.

Ordered 777-200 777-200ER 777-200LR 777-200F 777-300 777-300ER Totals 88 430 60 73 60 430 1,141

Delivered 88 413 42 25 60 243 871

Backlog 17 18 48 187 270

Basic Specs
Having been in production since the middle of 2004, the basic specs of the 777-300ER have evolved over time. The ﬁgures below are for the current production model with a wing span and overall length greater than those of the 747-400. The General Electric GE-90-115 series is the only engine offered on the 777-300ER.
Typical seating (3-class) .................................................................................. 365 Max Takeoff Weight ............................................................. 700,000 to 775,000 lbs Range (full psgrs & baggage) ..................................................... 6,400 to 7,900 n.mi

Current and Future Market Outlook
Going forward, the principal competitors to the Boeing 777 will be the Airbus A330 family and the A350 family that is now in development. Within the Boeing company itself, the competitors include the 767 and 787 programs. The 767 program is near to winding down (except possibly for the hoped-for air force tanker/transport program), while the 787 is inching towards its ﬁrst deliveries near the end of 2010. None of these Airbus and Boeing competitors is as large as the 777-300ER. In the near-term future, because of their good fuel efﬁciency, the 777s ought to retain their values fairly well as it will be several years before the more efﬁcient new generation of 787s and A350s achieve much market presence. However, residual values will inevitably decline. Boeing is also known to be studying further development of the 777 family, with various upgrades that may include an all-new wing design to provide even better range and fuel economy. A totally new airplane program is also a possibility, though probably this will be paced by the availability of a new family of engines.

Appraised Values
Our value opinions take into account recent transaction information (where available), the level and growth of long-haul airline passenger trafﬁc, the expected longevity and competitive standing of the 777 relative to current and future aircraft, plus historical trends of aircraft values in the past. Current Base Values, Current Market Values and Future Base Values Current values are as of September 2010, in millions of US dollars, 2.5% inﬂ ation Yr Mfr 2004 2006 2008 2010 CBV 104.7 121.6 141.2 163.9 CMV 96.8 113.2 132.4 154.7 2012 BV 93.7 108.5 125.6 145.2 2014 BV 83.4 96.3 111.2 128.2 2016 BV 74.0 85.3 98.3 113.2 2018 BV 65.3 75.3 86.8 99.8 2020 BV 57.1 66.0 76.2 87.7 2022 BV 49.4 57.3 66.3 76.5 2024 BV 42.0 49.0 57.0 66.1

The aircraft values stated herein are the product and property of independent third-party sources, and ISTAT neither approves nor endorses the information contained herein or the use thereof for any purpose whatsoever. Jetrader 45

Jetrader - September/October 2010

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