[ad_1]
The company delivered just six planes to customers in April, the lowest number of deliveries since 2008, when the company was dealing with a massive employee strike. Deliveries are important to the company’s finances because it receives most of the money from the airlines when the plane is actually delivered. Boeing reported a loss of $ 1.7 billion from its core operations in the first quarter, and announced plans to cut 16,000 jobs, about 10% of its staff, to save cash.
Boeing halted deliveries of its best-selling 737 Max in March 2019 after regulators grounded the plane in response to two fatal crashes. But the company was able to continue delivering other planes; it averaged almost 24 deliveries a month during the 12 months ending March.
US air travel USA Over 90% have plummeted from last year’s levels, forcing airlines to park most of their planes and cut plans to buy new ones. When asked if a major U.S. airline may be forced to close, Boeing CEO Dave Calhoun said that was possible.
“I don’t want to be overly predictive on that topic, but yes, most likely,” Calhoun said in an interview on Tuesday’s Today Show when asked about the possibility of an airline closing the business. “‘Apocalyptic’ accurately describes the moment.”
Still, Calhoun said he believes air travel will resume, even if he agrees with predictions that it will take three to five years for travel to reach 2019 levels again.
“As people begin to relive their lives, we hope they will travel again,” he said.
But the short-term drop in demand for planes was evident as the airline reported 108 orders canceled in April. Most of those canceled orders come from aircraft leasing customers, who buy planes and lease them from airlines.
GE Capital announced that it was canceling orders for 69 planes on April 17, and the China Development Bank canceled 29 orders for planes. The other 10 cancellations were made by an unidentified client.
That brings the total number of orders canceled so far this year to almost 300, far more than what was canceled last year in the wake of the 737 Max crisis.
The company also reclassified another 101 orders, removing them from what counts as firm aircraft orders. Many airline customers are delaying aircraft deliveries as approximately two-thirds of aircraft worldwide have been parked due to falling demand for air travel.
Southwest Airlines (LUV), one of Boeing’s best customers, announced that it would differ from at least 59 of the 107,737 Max aircraft it had planned to buy by the end of 2021.
“We don’t need the Max right now. We don’t need all the planes we have,” Southwest CEO Gary Kelly said last month when the company reported its first operating loss in 11 years.
[ad_2]
