Boeing Loses Jet Delivery Crown To Airbus

Earlier this month, we noted how Airbus locked in a record number of aircraft deliveries in December to exceed full-year delivery targets while outshining troubled Boeing in becoming the world’s top plane maker.

The report, however, did not include official numbers and had to be audited before officially published.

But now, we have official data that confirms Boeing has lost its crown as the world’s biggest plane maker to rival Airbus following the 737 Max crisis, reported the Financial Times. 

Boeing received 246 new aircraft orders in 2019, the lowest in nearly two decades, which dropped to a negative 87 after cancellations. 

Boeing orders have been halved since 2018’s 806, recorded just 380 in 2019, the lowest since 2008. 

Before the Max crisis, Boeing estimated that deliveries for commercial jets would be around 895 to 905 for 2019. 

The problem with Boeing is that management rushed engineers to develop a more fuel-efficient 737 to complete with a new lineup of single-aisle jets from Airbus. Boeing encountered difficulties with adding larger engines to the plane and developed the MCAS (Maneuvering Characteristics Augmentation System) anti-stall system that would help the aircraft stabilize in flight. But it was the malfunction of the MCAS system that led to two plane crashes, killing 346 people, which eventually led to the grounding of all 737 Max planes worldwide. 

Airbus entered the new decade as the top plane maker of the world. The company said it secured orders of 768 aircraft in 2019, up 24 over the prior year. Deliveries totaled 863, up from 806 in 2018. It has a backlog of some 7,482 commercial jets, versus Boeing’s 5,406.

Shown in The Seattle Times chart below (updated on December 29), the grounding of the Max and now suspension of its production had more than halved deliveries from 806 in 2018 to 370 in 2019.

The Times noted that once the Max is ungrounded, and as of Wednesday, there are no concrete timelines, Boeing will begin delivering 400 aircraft that have been parked since global regulators grounded the plane on March 13, 2019.

Analysts have warned that inspecting the grounded jets could take at least 12 months to complete, and that could add to the backlog and weigh on new production for a considerable amount of time.

 “It will take Boeing all of this year and most of next year to clear that backlog [of grounded aircraft],” said Rob Stallard, an analyst at Vertical Research. 

Sash Tusa, of Agency Partners, predicts the Max could return to the skies by the end of 1Q. “Our forecast for Airbus deliveries in 2020 is 933 aircraft. We forecast Boeing to do 978 aircraft. But that assumes the Max returns to service at the very end of the first quarter,” Tusa said.

Extended grounding has led some carriers to suspend future deliveries of Max planes. The latest report from Reuters notes that Malaysia Airlines has suspended deliveries of 25 Max jets, citing no clear timetable of ungrounding. 

“As there is no clarity yet from various authorities on its return to service, our technical due diligence is still ongoing,” Malaysia Airlines said.

Virgin Australia Holdings said last year that it had delayed Max jets for two years due to the grounding. 

Norwegian Air Shuttle ASA recently said that it reached an agreement with Boeing to postpone delivery of 14 Max jets because of the grounding.

And last April, the near-collapse of India’s Jet Airways led to the cancellation of 210 aircraft from Boeing that was expected to be delivered in the coming years. 

The grounding of the jets has forced Boeing to freeze the production of the planes that could lead to lower GDP growth in the US for 1H. 

The longer Max remains grounded, the more orders Airbus will gain. The Max crisis also comes as an industrial recession plagues the US economy and has already spilled over into an employment slowdown.