Aerospace & Defense

Boeing's 6-Month Deliveries Plunge by More Than a Third

Paul Ausick

Boeing Co. (NYSE: BA) reported Tuesday morning that second-quarter deliveries of its 737 family of jets totaled just 24, down from 89 in the first quarter and 173 in the fourth quarter of 2018. Given that the company’s 737 MAX jets were grounded in mid-March, the lack of new deliveries of the company’s bread-and-butter aircraft is no surprise.

The company delivered 132 of its 737 family jets in the first quarter of 2018, 137 in the second quarter and 138 in the third quarter, for a total of 580 for the year. With the 737 MAX grounding now expected to last until close to the end of this year, it’s pretty clear that the company’s cash flow in 2019 is going to be way short of expectations.

Boeing delivered 194 commercial planes in the second quarter of last year, compared with deliveries of just 90 planes in the 2019 second quarter. In the first half of 2019, deliveries have plunged by 37% from 378 last year to just 239 aircraft.

For the first two quarters of the year, Boeing has delivered 113 of its 737 MAX 8 and MAX 9 planes and 78 of the 787 Dreamliners. The company delivered 42 Dreamliners in the second quarter, up from 36 in the first quarter and 39 in the fourth quarter of 2018.

The company delivered 12 dual-aisle 777s in the quarter, up from 10 in the first quarter and 11 in 2018’s fourth quarter. Boeing delivered two jumbo 747s, the same number as in the first quarter and 10 767s, double the number it delivered in the second quarter of last year. For the year to date, Boeing has delivered 22 767s, nearly as many as the 27 it delivered in all of last year. The 767 is the base aircraft for the KC-46A tankers Boeing is manufacturing for the U.S. Air Force.

The company’s defense division delivered just five new tankers to the U.S. Air Force in the second quarter, down from seven in the first quarter. The Air Force discovered debris rattling around in some of the first tankers delivered and has slowed deliveries to around 1.5 planes per month, about half the original delivery schedule.

The big problem remains to fix the anti-stall system and other newly discovered problems on the 737 MAX so that the company can deliver jets that it now has parked near its facilities in Everett, Washington, and San Antonio, Texas. The planes are stacking up at the rate of 42 per month and it looks like deliveries are not about to resume anytime soon.

Boeing stock traded up about 0.4% in the noon hour, at $352.41 in a 52-week range of $292.47 to $446.01. The stock’s 12-month consensus price target is $420.14.