New York: Boeing on Tuesday announced a decline in annual aircraft deliveries and a dwindling backlog as it suffered double crises stemming from 737 MAX grounding and the travel industry downturn due to Covid-19.
The numbers provide the final toll from the year of bruising that forced Boeing in March to seek a rescue from Washington as it faced existential questions during the height of the two crises. Boeing succeeded in getting help, but turned to private support instead.
Boeing, which has cut tens of thousands of jobs amid its struggles, presented just 157 plans last year, down 59% from 2019.
The company’s backlog at the end of 2020 reached 4,223, down from nearly 5,900 plans at the end of 2018, when the airline industry was still in a growth mode before Covid-19 and MAX was still flying.
Airlines in 2020 canceled 641 applications for MAX, which was approved later that year to resume flights in the United States and some other markets after a 20-month hiatus after two fatal accidents.
The outcome – This made Boeing well below rival Airbus in annual deliveries – The year that started concludes with new CEO Dave Calhoun halting the targeted return of the MAX and endorsing the enhanced training of its pilots.
Both were an attempt to mend the space giant’s relationship with US air safety regulators after two plane crashes that killed 346 people.
With MAX still out of business and facing countless questions, Boeing’s prospects took a big hit in March as airline travel fell dramatically as the United States and other major economies shut down to confront Covid-19.
Faced with questions about its long-term survival, Boeing campaigned in Washington for a federal bailout, and ultimately secured a $ 17 billion in relief action under the CARES Act in March.
Ultimately, Boeing chose not to tap the money after emergency steps initiated by the Federal Reserve opened the debt market. Boeing announced in April that it would raise $ 25 billion in publicly traded bonds.
Boeing’s fortunes began to turn in the fall, when the FAA allowed the MAX to return to service after a thorough review.
On December 3, Boeing announced its first major order for new MAX plans after a 20-month hiatus from Irish Ryanair. Advances in coronavirus vaccines have boosted expectations about when the aviation industry will recover.
Through most of 2020, Calhoun predicted that it would take about three years for the aviation industry to return to pre-pandemic activity levels and about five years to return to growth.
But in early December, the Boeing chief said the vaccine “came a little faster than most people thought, which means that our schedule is more aggressive today” compared to previous expectations.
Last week, Boeing settled a US criminal investigation into its certification of the MAX, and paid $ 2.5 billion for claims settlement purposes that took the company to the regulators overseeing the 737 MAX.
An older-generation Boeing aircraft was involved in a plane crash in Indonesia last week, killing 62 people. The investigation of this accident will likely take months.
Boeing expressed confidence in its future on Tuesday.
“Through the global pandemic, we have taken targeted steps to adapt to our new market, transform our business and provide our services to our commercial, defense, aerospace and service customers in 2020,” said Greg Smith, Chief Financial Officer of Boeing. MAX to summarize the service a “milestone”.
Smith said: “In 2021, we will continue to take the right actions to enhance our safety culture, maintain liquidity, and transform our business into the future.”