Boeing 747 Fades Out but Lufthansa Flies a Fresh One to JFK

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New York ( TheStreet) --  The 1,500 th Boeing  747 will receive a grand welcome Tuesday, when Lufthansa puts the latest model, the 747-Intercontinental, to work on the Frankfurt-JFK route. No other widebody aircraft has yet recorded 1,500 sales.

Unfortunately, few welcomes remain for the 747, a dramatic innovation when it was first flown by Pan American World Airways in 1970 as the first twin-aisle jet and easily recognizable due to its size and the hump at the top of its frame.

In its time, the 747 was both a "game changer," the term now widely applied to the Boeing 787, and also "a moonshot," the term Boeing CEO Jim McNerney used in May to describe an innovative course that Boeing no longer wants to pursue.

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Boeing shares closed Friday at $128.09, up 1%.

The 747 is being replaced by newer, more efficient, more specialized aircraft. "The passenger model fills a niche within a niche, squeezed on top by the Airbus A-380 and on the bottom by the 777," said aviation consultant Scott Hamilton, president of Leeham Co. "The airlines I talk to think the cost is too high for what you get."

Meanwhile, the 747-8F, a freighter aircraft that began flying commercially in 2010, faces a difficult cargo environment. "The cargo market is poor," Hamilton said. "It's been coming back a little this year, but you've got a lot of surplus capacity, a lot of freight moving in the 777 and the A330, and the 747 competes with the 777F." The 777 cargo variant was launched in 2005.

"Boeing doesn't talk much about the passenger model anymore, but it claims there will be an indefinite requirement to produce one to 1.5 freighters a month," Hamilton said. "They think they will see a cargo recovery in 2016 or 2017." But Hamilton anticipates the aircraft will be gone by the end of the decade.

Lufthansa took delivery of the first 747-Intercontinental in 2012, and now has 14 of them. Boeing has received 120 orders for the latest and likely the last 747 variant, which Lufthansa will fly with 362 seats. "The 747-8I passenger version has four years or less, although the last few will be notable as the latest Air Force One variants," said aerospace analyst Richard Aboulafia of the Teal Group.

"The 747 was indeed a moonshot," Aboulafia said. "But the world was different back then. This is a far more mature industry, with fewer compelling opportunities for new product launches."

In a recent story -- "The 747 Is Going Extinct" -- the online news site Quartz reported that the 747's capacity share, as measured by available seat miles, is expected to fall 14.1% between 2009 and April 2015. Over the same period, the Airbus A330 share is expected to grow 8.8% and the Boeing 777 share is expected to grow 8.7%, said Quartz, using data compiled by PlaneStats.com.