Boeing’s iconic 747 is officially on life support.
The company announced Thursday that it will again cut production of the 747-8 as the air cargo market slows. Production will be halved from one new plane per month to just six a year beginning in September.
Ray Conner, the CEO of Boeing Commercial Airplanes, said that while air passenger traffic is strong, the cargo market has stalled — creating less demand for the 747-8 freighter.
The company warned investors that the decision would result in a $569 million after-tax charge on its next earnings report.
Dubbed the “queen of the skies,” the 747 jumbo jet has long been a favorite of the flying public. But in recent years, airlines have shifted most of their purchases to smaller, two-engined aircraft in order to save on fuel costs. The Airbus A380, another massive jumbo jet, has also suffered from weak demand.
Boeing has at least one more high-profile 747 order to fill. Last year, the Pentagon announced the next generation of Air Force One will be a military version of the 747-8.
Air cargo volumes were down in November 2015 by 1.2% compared to November 2014, according to The International Air Transport Association. However, the organization said total cargo volumes may be bottoming out.