Surprise Widebody Orders Lift Boeing’s August Activity
Boeing booked 17 widebody orders from unidentified customers among its 53 gross additions in August, including seven for 787-9s, providing a boost during a largely anemic time for long-haul passenger demand.
Also among the orders are 11 777 freighters, all but one of which are for unidentified customers. The freighter buys are a welcomed addition to Boeing’s 777 production line, which is building legacy 777s longer than originally intended following delays in the 777X program.
Boeing also booked 35 737 MAX orders, including two from unidentified customers.
The August backlog changes included 30 cancellations: 20 unidentified 737 MAX purchases and eight United Airlines orders. The United move was part of a delivery position swap that saw the carrier book eight of the month’s 737 MAX orders. Lessor Avolon canceled two 787-9s.
The net gain of 23 orders is the seventh straight month of backlog growth, with gross orders out-numbering cancellations. The orders, particularly for the 787-9s, also point to customer confidence in committing to either growth or more-efficient replacement aircraft amid an uncertain demand environment.
The latest IATA figures show global international revenue passenger kilometers were down 84% for the first seven months of 2021 compared to pre-downturn 2019. Domestic traffic, lauded as leading the recovery, remains down 30% across the board.
Despite the gloomy aggregate figures, Boeing remains confident that a sustained recovery is underway. Its latest 20-year forecast factors in 4% average annual RPK growth, and a return to 2019 levels by mid-2024 at the latest. Domestic and tightly linked regional markets, such as Europe, are expected to rally more quickly.
Boeing delivered 22 aircraft in August. Fourteen were 737 MAXs, seven of which went to United. The company also delivered one 767 freighter, two 777 freighters, two P-8 maritime patrol aircraft, and three KC-46 tankers. Deliveries of 787s remain on hold while Boeing works through production-quality issues that require inspections and re-work.
The 737 MAX delivery pace, a key part of Boeing’s plan to solidify its balance sheet, slowed from recent months. Boeing had been averaging about 18 per month in 2021, with spikes in June and July that saw a combined 55 MAX aircraft handed over to customers. The company has delivered 141 in 2021, and 168 since MAX deliveries resumed in December 2020 following a 21-month pause linked to the model’s global grounding.