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March 3, 2024

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Boeing won big on September jet orders but 737 MAX snag cut deliveries

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SEATTLE — Amid hectic demand for jets from the world’s airlines, Boeing had a blockbuster sales month in September. But manufacturing quality lapses slowed production and cut jet deliveries.

According to company data released Tuesday, Boeing booked a big tally of 214 net new commercial airplane orders last month.

That included large recent orders for the 787 widebody jet from United and Air Canada, as well as a giant Ryanair order first announced in May and finalized only now for 150 of the largest 737 MAX narrowbody jet, the MAX 10.

Those orders boosted Boeing’s September sales tally far past European rival Airbus, which on Monday announced only 23 net new jet orders for that month.

On the production side though, the latest quality problem with the 737 MAX set Boeing back. Its total of 27 jets delivered was just less than half the 55 that Airbus delivered.

Boeing reaps sales as air traffic returns

Air traffic has come soaring back to reach 97% of pre-pandemic levels worldwide, with domestic air travel actually 9% above the 2019 level, according to the latest International Air Transport Association data.

Airplane production by Airbus and Boeing has not recovered nearly as much, resulting in heavy demand for all the jets the two manufacturers manage to roll out.

Airlines are placing big orders for fear of losing out in the scramble to buy.

Last week, United announced it had added to its order placed in December for 100 Boeing 787 Dreamliners, tacking on 50 more now, with options to buy another 50 in the future.

Air Canada last month ordered 18 of the largest Dreamliner model, the 787-10. Six more Dreamliner orders came from unidentified customers.

And the now-finalized Ryanair order for the MAX 10 confirms the sales momentum for that largest model, even though it is still in flight test and cannot be delivered until certified by the Federal Aviation Administration sometime next year.

Boeing had 10 orders canceled in the month: three narrowbody MAXs, four midsize widebody 787s and three large widebody 777 freighters.

For the new Airbus orders in September, LATAM Airlines Group of Chile ordered 13 of the hot-selling Airbus narrowbody A321neos and Turkish Airlines ordered 10 large widebody A350-900s.

The recently announced Air France-KLM order for 50 A350s was not finalized in time for the September tally.

Likewise, the United order for 60 narrowbody A321neo jets announced on the same day as Boeing’s order from United is not included in the Airbus tally.

Those sales will be added to the Airbus order book later.

Through September, Boeing has booked 724 net new orders and Airbus 1,241.

MAX deliveries cut back

The two giant airplane manufacturers in the world are producing jets at a much lower rate than before the global pandemic, squeezing the supply and creating the shortage that is boosting demand.

In 2018, before the two deadly 737 MAX crashes happened, Boeing delivered 568 jets through September.

Still not recovered from the impact of those crashes followed by the drastic pandemic downturn, the data shows this year Boeing delivered only 371 jets through September, or 35% fewer.

In 2018, Airbus had delivered 508 jets through September, fewer than Boeing.

Still struggling like Boeing with the chaos in the supply chain caused by the pandemic, Airbus this year has delivered 488 jets through September, considerably more than Boeing but still 4% lower than in 2018.

The big lag in Boeing’s recovery is due not only to the effect of the MAX crashes but to the discovery of a litany of quality issues that have successively hit both the 737 MAX and the 787 programs.

The latest is a defect in the aft pressure bulkhead of the MAX, a critical part that preserves cabin pressure and is built by Spirit AeroSystems in Wichita, Kan.

MAX fuselages built by Spirit had been delivered with improperly drilled holes in that component. Boeing Chief Financial Officer Brian West said last month the labor-intensive repair is complicated and affects three-quarters of the 220 jets still parked in inventory.

The defect also affects some of the MAX 8s that were under assembly. The MAX 9 models are not affected, Boeing said.

As a result of the repair work, Boeing delivered only 15 MAXs in September, the lowest monthly total in two years, compared for example with 48 delivered in June.

The poor showing for MAX deliveries out of Renton was partially compensated for by an improved delivery rate of the787, assembled in North Charleston, S.C.

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Boeing delivered 10 Dreamliners in September, the first time in double digits this year.

Some of those 787s were planes delivered not off the assembly line in South Carolina but from the inventory of jets parked due to out-of-specification gaps at the structural joins. Teams of mechanics in Everett have been laboriously repairing those airplanes.

Airbus delivered 55 jets in September, including 44 of the A320neo family of airplanes that competes directly with Boeing’s 737 MAX line-up.

Airbus also delivered four smaller A220 narrowbody aircraft and seven widebody jets.

Boeing delivered two 777 freighters in addition to the 10 Dreamliners for a total of a dozen widebody airplanes.

Airbus is maintaining its guidance that it will deliver a total of 720 jets this year, a target that will require a very strong fourth quarter.

Boeing hasn’t announced an overall jet delivery goal, though it is targeting delivery of just over 400 narrowbody 737s, mostly MAXs along with a few military derivatives.

That should bring Boeing’s total jet deliveries to somewhere just above 500 for the year.

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