Boeing deliveries remain low as 787 problems weigh

FILE PHOTO: A Boeing 787-10 Dreamliner taxis past the Final Assembly Building at Boeing South Carolina in North Charleston

(Reuters) -Boeing Co said on Tuesday it delivered 32 aircraft in January as its sidelined 787 Dreamliner program continued to weigh on the planemaker’s ability to capitalize on a recovery in air travel.

The company handed over 27 737 MAX jets in January and three widebody aircraft, including a 777 freighter, Boeing said in its closely watched monthly report.

Of the 27 MAX deliveries, seven were to Irish budget carrier Ryanair, while China Eastern Airlines took delivery of one 777 freighter.

Boeing handed over 38 jets in December and 34 in November.

The fewer January deliveries reflect a seasonal dip. Boeing delivered 26 aircraft in the same period a year ago.

The 737 MAX and the 787 Dreamliner are crucial to Boeing’s ability to recover from the pandemic and catch up with Airbus, having lost out on the delivery race to its European rival for the third consecutive year.

After slashing production mainly due to the pandemic, planemakers are seeing more demand for medium-haul passenger jets and freighters, and are rushing to ramp up production.

However, snags in Dreamliner production have proved costly for Boeing, with the company incurring $4.5 billion in charges in the fourth quarter and paying customers penalties for pushing back deliveries.

Boeing booked 77 orders on a gross basis in January, including for 55 MAX airplanes and 22 freighters. Demand for the cargo planes has been a bright spot for the company, as it continues to dominate sales during an e-commerce surge.

Of the freighter orders, 14 were from Qatar Airways for the 777-8 model. The airline last month handed Boeing an order for 34 new 777X freighters and 25 737-10 MAX jets.

Of the 737 MAX orders in January, 20 were from unspecified customers, with U.S. carriers American Airlines Group Inc and Southwest Airlines Co making up the remaining 35.

There were two cancellations for the 737 MAX in January, bringing Boeing’s overall net orders to 75.

Airbus delivered 30 airplanes in January.

A $600 million contractual and safety dispute between Airbus and Qatar Airways deepened on Tuesday when the European planemaker revoked orders for two A350-1000 jets, days after ripping up an order from the Gulf carrier for 50 A321neos.

Qatar Airways has sued Airbus for more than $600 million and is refusing to take further delivery of A350s until its regulator receives a formal analysis of erosion to the painted surface and underlying lightning protection on 21 of the jets.

Airbus included the cancellations for 50 A321neos and two A350-1000s in a monthly summary for January, pushing it into negative territory with a net total of minus 16 orders for the month, after receiving 36 new orders.

(Reporting by Abhijith Ganapavaram in Bengaluru and Eric M. Johnson in Seattle; Editing by Shounak Dasgupta and Richard Chang)