• See Scott Hamilton's new column for Forbes on-line, It's time for hard questions for Boeing.

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Introduction

One of Boeing's white tail 747-8Fs. This, and another that has been stored, was painted in the livery of the Seattle Seahawks. Boeing photo.

Jan. 25, 2016, © Leeham Co. Boeing’s decision to cut the production rate on the 747-8 is not a surprise. It’s only a surprise that it took officials so long to do so.

The company continues to cling to the hope of a recovery in the global air cargo market to sustain the program. This is unlikely, however.

The business case for the 747-8F is minuscule.

Summary

• The metrics of the global freight market have simply changed too much.
• Load factors for freight remain stuck below 45%.
• Yields continue to be low.
• Shifting trends from main deck freighters to using lower deck space on the big passenger airlines continues to grow.
• Low fuel prices, temporary though they may be, diminish the new for new 747-8Fs.
• Low capital cost 747-400 Passenger models stored in the desert or soon to be exiting the world’s fleet, along with stored 747-400Fs, provide ample opportunity for cheap freighters.