Friday 26 February 2021

Boeing’s commercial jets revenue slips 37% in Q4

SEATTLE, 29 days ago

Being said its fourth-quarter revenue from commercial airplanes decreased to $4.7 billion from $7.5 billion a year earlier, down 37.3%, driven by lower widebody delivery volume due to Covid-19 impacts as well as 787 production issues.

The losses were partially offset by higher 737 deliveries and a lower 737 MAX customer consideration charge in the quarter compared to the same period last year.

Fourth-quarter operating margin decreased to (161.8) percent, primarily driven by a $6.5 billion pre-tax charge on the 777X program, lower delivery volume, and $468 million of abnormal production costs related to the 737 program, partially offset by a lower 737 MAX customer consideration charge.

The commercial airplanes production rate assumptions reflect the continued impacts of Covid-19 on commercial demand, and the company will continue to assess them on an ongoing basis. The 737 program is currently producing at a low rate and expects to gradually increase production to 31 per month in early 2022 with further gradual increases to correspond with market demand.

The 787 program plans to transition its production rate to five per month in March 2021, at which point 787 final assembly will be consolidated to Boeing South Carolina.

Boeing said it expects first delivery of the 777X to occur in late 2023 and has recorded a $6.5 billion reach-forward loss on the 777X program.

Among the factors contributing to the revised first delivery schedule and reach-forward loss are an updated assessment of certification requirements based on ongoing communication with civil aviation authorities, an updated assessment of market demand based on continued dialogue with customers, resulting adjustments to production rates and the program accounting quantity, increased change incorporation costs, and associated customer and supply chain impacts. The production rate expectation for the combined 777/777X program remains at two per month in 2021.

Boeing captured orders for 75 737 aircraft from Ryanair and eight 777 freighters from DHL, as well as a commitment for 23 737 aircraft from Alaska Airlines.

The company delivered 59 airplanes during the quarter (79 in Q4 2019), and backlog included over 4,000 airplanes valued at $282 billion. – TradeArabia News Service


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