MAX Cancellations, 787 Issues Dim Boeing’s June Orderbook Momentum

Credit: Flydubai

Boeing’s fifth straight month of positive net orders and several delivery-data bright spots were offset by flydubai’s cancellation of 65 737 MAXs and news of more 787 production-quality issues, the company’s June commercial program activities update shows.

The company booked 219 gross orders, including 200 737 MAXs from United Airlines, Boeing said July 13. The figure is the U.S. OEM's highest gross-order total since June 2018, company figures show. Included in the gross-order total is an 18-aircraft 767-300F buy from FedEx Express. The package carrier announced a 20-aircraft order in June, but two are conditional.

Cancellations totaled 73, led by flydubai’s move. The Dubai-based carrier, an all-737 operator, has 15 737 MAXs in its fleet and 171 more on order, Aviation Week Intelligence Network Fleet and Data Services shows. 

The cancellations appear to be a mix of post-downturn fleet-plan adjustments and fallout from the 737 MAX fleet grounding that regulators in several jurisdictions in the airline’s route network, including India, still have in place. Flydubai had pushed off new 737 deliveries as it focuses on bringing its grounded models back into service.

BOC Aviation canceled five 737 MAXs, while an unnamed customer canceled a MAX business-jet variant. The other two June cancellations were UK Royal Air Force (RAF) E-7A Wedgetails. The RAF committed to five, but two were cut as part of its latest defense review.

Boeing’s June bottom line showed 146 net orders, marking five straight months where gross orders outnumbered cancellations. It also recorded a net change of 56 additions to its ASC 606 accounting category, signifying firm contracts but shaky delivery prospects—49 737s and seven 787s. Its official backlog on June 30 stood at 4,166, excluding 918 aircraft in the ASC 606 category.

Customers took delivery of 45 aircraft in June—the most since March 2019, when the 737 MAX was grounded and deliveries of the narrowbody were paused. June’s deliveries included 33 737 MAXs—the most handed over in one month since December 2018. Boeing also delivered two P-8 maritime patrol aircraft to the U.S. Navy.

Boeing delivered 10 widebodies in June, including one 787-9 to Turkish Airlines, but its airworthiness certificate was issued in late 2020, before a five-month delivery pause linked to production-quality issues. A second pause that started in May has new airworthiness approvals and deliveries on hold as Boeing works with the FAA on validating how the manufacturer determines inspection protocol for aircraft in its inventory—work that must be completed before deliveries can resume. The company has disclosed several production-related issues that must be analyzed and, in some cases, corrected to ensure aircraft are airworthy. 

The primary issue with the 787s is linked to major structure joins that do not meet design standards. In some cases, shims meant to correct the issues were not properly sized, leaving gaps that are out of tolerance.

Boeing has disclosed join issues in several areas including between fuselage barrels, and continues to inspect and conduct necessary rework on aircraft that need it. Boeing recently discovered discrepancies with the forward pressure bulkhead in the nose, or Section 41, subassembly made by Spirit AeroSystems.

The continued inspections, rework, unresolved validation issues, and new forward bulkhead problems have led Boeing to pull workers from 787 production and assign them to inspection and rework efforts. The move means Boeing’s 787 monthly production rate will drop to below five per month for at least a few weeks, the company said. 

As a result of the mounting issues, Boeing now expects to deliver fewer than half of the 100 787s it has in its inventory by yearend. The company reports 14 787 deliveries so far in 2021.

Sean Broderick

Senior Air Transport & Safety Editor Sean Broderick covers aviation safety, MRO, and the airline business from Aviation Week Network's Washington, D.C. office.