Boeing deliveries of 737 tumble in 2nd quarter
Lost $6 billion Flyadeal deal latest sign of aircraft maker’s ongoing image problem.
CHICAGO – Deliveries of Boeing’s 737 aircraft tumbled in the second quarter, as the company continues to deal with repercussions following two deadly crashes. Boeing said Tuesday it delivered 24 of its 737s in the second quarter, down sharply from the 89 delivered in the first quarter.
The announcement comes a day after Boeing said Saudi airline Flyadeal, the budget airline arm of Saudi Arabian Airlines Corp., cancelled an order worth up to $5.9 billion in favour of a deal with rival Airbus. Flyadeal ordered 30 A320neo jets from Airbus and took options on 20 more, meaning that its entire fleet will consist of planes from that company. It’s a potentially troubling sign for Boeing, which has not seen customers divert orders to Airbus en masse.
Boeing previously got a boost at the Paris Air Show when the parent company of British Airways and Spain’s Iberia said it intended to buy another 200 Max planes.
Boeing Co. has been on a campaign to restore the reputation of its bestselling 737 Max since crashes off the coast of Indonesia and in Ethiopia killed 346 people. The Max has been grounded since March. The Chicago company disclosed in April that it has booked about $1 billion in charges related to fixing the plane. Analysts expect that to rise sharply.
Dozens of lawsuits have been filed by families of those aboard the downed planes, and last week Boeing said it will make an initial investment of $100 million over several years to help families and communities affected by the two crashes. Boeing also will likely have to compensate airlines that already own Max planes – nearly 400 around the world – which are not expected to be allowed in back into the air any time soon.
Boeing marketed the Max as an aircraft with more seats and lower operating costs than the Airbus neo. Boeing still has more than 4,500 unfilled orders for the Max. Customers, including three of the four largest U.S. airlines, have given no hint that they plan to nix orders from Boeing.