By Alwyn Scott
NEW YORK (Reuters) - Boeing Co's (N:BA) production of 777 jets may be cut further than projected if sales lag this year, the company's chief executive said on Wednesday.
Cutting production of 777s would "add pressure" to Boeing's goal of hitting its profit-margin target, but would not change the target, Boeing Chief Executive Officer Dennis Muilenburg said at an investor conference hosted by Morgan Stanley (NYSE:MS).
Boeing makes 8.3 of its 777s per month, and had already announced plans to cut output to seven per month next year as it shifts to a new model, the 777X, which enters production in 2018. The shift will mean deliveries of the 777 fall to about 5.5 a month in 2018, Muilenburg said.
But the company has sold just eight 777s this year, far short of its target of 40 to 50 sales needed to sustain production at those levels.
"So, obviously, pressure there," Muilenburg said, noting numerous 777 sales campaigns are underway.
"We need to be successful on some of those campaigns over the next two to three months to hold that seven-a-month rate structure," he said. "If we don't, we'll have to adjust."