The company reported more cancellations than new business In 2019, the order backlog for the disturbed 737 Max shrank by 183 jets. Much of it was because of some foreign airlines, such as India's Jet Airways. go bankrupt, but with the concerned Max there was little demand to make up for the lost Assignments.
The 777, which was delayed in debuting the 777X version, also lost more orders than it won. Even with positive orders for the Dreamliner 767 and 787 Boeing & # 39; s (BA) total Orders for commercial aircraft dropped 87 jets last year.
Even without the impact of canceled orders, Boeing's order intake fell significantly over the course of the year, falling 74% to 243. This was mainly due to the 90% decline in orders for 737 models during the year. After the foundation in mid-March, Boeing hardly had any firm orders for the Max, but other models also had to accept a 29% drop in incoming orders.
Boeing was far behind the rival airbus (EADSF), Last week, Airbus reported record shipments of 863 jets, an increase of 8% and an increase of 2% to 768. Despite the fact that Airbus suffered its own setback when the A380 jumbo jet was discontinued earlier this year.
Boeing had a particularly strong year in 2018 and there would probably have been a drop in orders for the Max without any problems. Many airline customers have already ordered aircraft that they will need in the coming years. Boeing and Airbus both have an order backlog that allows them to work without new orders for years.
It is no longer clear how long it will take Boeing to recover from this crisis.
Until recently, it had largely been assumed that Boeing could quickly bounce off the crisis if the Max were given permission to fly again.
In the course of 2019, the 737 Max continued to be built, albeit a little more slowly. It ended the year with around 400 jets completed but not yet delivered. Delivering these aircraft could have enabled Airbus to move forward if it could have kept aircraft production going.
Last month it was announced that the Max's production would be temporarily suspended for an indefinite period of time sometime in January.
While it doesn't vacation or cut its own workers, its biggest supplier is Spirit AeroSystems (SPR), announced to lay off 2,800 workers building the hull and other parts for the Max. A reduction in staff is also expected from other suppliers.
"That's the big problem," said Richard Aboulafia, aerospace analyst at Teal Group. "You will need the suppliers. Starting up will only be as strong as its weakest link."
However, suppliers like Spirit cannot employ all of the employees, as the outage is likely to take longer than at Boeing.
Boeing built the 737 Max fuselages and other parts at the upstream pace of 52 aircraft a month, although Boeing reduced production to 42 aircraft a month, Boeing has approximately 100 fuselage and other spirit parts that are waiting for production to resume.
The Max was responsible for more than half of Spirit's earnings, the company said when it announced its release. According to the rating agency Moody's, it accounts for at least 10% of sales from seven other providers. Moody & # 39; s downgraded Spirit's debt to junk bond status on Monday night.
Boeing's finances are in much better shape. But Moody & # 39; s announced on Monday that it was considering a Boeing credit rating downgrade, although the status of junk bonds is likely to remain above that of Boeing even after a downgrade.
"Recent developments indicate a more costly and protracted Boeing recovery," said Jonathan Root, Moody's senior analyst for the company. He said this would mean that "there will be a time of increased operational and financial risk, even if Max's certification is relatively short-term, as expected."