RichSafran: Dave, Brian and Matt, good morning. So you’re not going to be surprised, I’d like to ask you about defense. I wanted to know, first, could you broadly discuss your defense portfolio, the opportunity set and what we should be focusing on? Just by example, I noticed that AIA you were discussing a C-17 C-130 recap. Second to that, could you also discuss the F-15EX program in terms of expectations for deliveries, production rates? And also if margins on the program might be comparable to what we saw when you were selling older models under FMS? Thanks.
Dave Calhoun: Yes. So let me take this one. Let me address it at the portfolio level. In light of the difficulties we’ve had with the fixed-price development contracts, which I consider more of a contracting exposure as opposed to a portfolio exposure, I feel really good about the portfolio broadly, and there are reasons why I feel that way. We’re fully invested, as you know, autonomy. I believe autonomy and teaming are going to be one of the real drivers with respect to airplane development, Air Force, Navy requirements going forward. And we’re already invested and we’re making real progress with both of those members of the fighting forces. And I’m sure you know the programs that we talk about. And there are others we can’t talk about, which we’re as excited, if not more excited about.
So the long portfolio and the development that we’ve sustained over all these years, I feel really good about. We have the T7 trainer. It’s way more important than just the market for trainers itself. Ultimately, we think it’s — it can be used as a derivative to do other things for the Air Force, and I’m sure you know what that’s about. But maybe even more importantly, it’s an absolute poster child for our digital thread. And it’s teaching our customers how to think about the use of the digital thread, and it’s teaching us how to perfect all the production technologies that we need to take full advantage of the digital trend. So if I look at our — just our sort of our wing fleets, I feel very good about where we are. And as you point out, the F-15 — the new derivatives boy, they are really important to our customers.
We feel great about the future. It feels like a new platform, frankly, from my perspective, I’m not going to hand out the production rates at this stage, but we’re feeling pretty good about the international demand as well as our U.S. demand. And you know, in light of the only other choices, this gets, frankly, more valuable over time until the really new classified work ultimately was completed and brought to the market. Anyway, I feel quite good about the portfolio. It’s development where we stand in it. And I’m sorry, some of the contracting methods that we used in the early going here, but anyway, we are where we are. And I can’t get off the page without talking about the tanker, which we all still believe very, very strongly and, again, difficult contracting moment for us.
On the other hand, futility to the Air Force has been fantastic. The Vision system our commitment to it and then technologies beyond that allow for even autonomous refueling. These are things we’re fully invested in, and we believe in the growth of the industry and the need with our customer. So anyway, there are other things, and you probably know a lot of that, but there’s a reason to feel good, frankly, on the development front with respect to Boeing’s defense business.
Rich Safran: Thanks for that, Dave.
Brian West: John, we have time for one more question.
Operator: Certainly, and that will be from Sheila Kahyaoglu with Jefferies. Please go ahead.
Sheila Kahyaoglu: Good morning, guys. And thank you. I know it’s been asked a thousand different ways, but I don’t know if I know the answer yet. So maybe, Dave, can you give us an idea of how — where you are on the MAX and 787 from a cash per aircraft perspective? Or how far that is below prior peak? And is there a cadence of that profitability, free cash flow as we think about production rates increasing, supply chain impacts and just pricing as you get aircraft out of inventory.
Dave Calhoun: Let me take a shot at the — I’ll talk cash margins, and let’s start with the 787. So near term, they’re pressured but positive, and we got to work through all the things that we’ve been describing. In long term, they’re going to be higher than they were back in 2018, driven by productivity, pricing in the Dash 10 model. So the 87 feels like it’s on the verge of doing some real special stuff over the long term. On the 37, near-term pressure because all the supply chain things we talked about, some customer mix things that we’re going to battle through impossibly some impact to remarketing. And then long term, it’s going to be more or less in line with what it was before and the benefit being the productivity and the rate ramp. So that’s kind of how we think about those two programs over time from a cash perspective.
Brian West: Really — Sheila, you really have to get through calendar year ’24. And then a lot of the cloud, a lot of the things that we’ve been wrestling with, the things that impact the — our margins and the lumpiness along the way, that all begins to clear as we get to the tail end of ’24. And as we think about ’25 and on, I think that clarity will be apparent to everybody.
Sheila Kahyaoglu: Great. Thank you.
Matt Welch: And that concludes our fourth quarter 2022 earnings call. Thank you for joining.
Dave Calhoun: Thanks, everyone.
