We already are nearing the end of the second month of 2020, but we have still been busy wrapping up the Boeing and Airbus delivery value overview for 2019. Obviously, 2019 has been an intensive year for the aerospace industry with the demise of the Airbus A380 and the problems with the Boeing 737 MAX. Orders always make headlines, but deliveries are where the cash comes in, and so for investors, it’s also interesting to look at the deliveries. Normally, we see that deliveries or orders are used as measures to see what Boeing (BA) and Airbus (OTCPK:EADSF) did better in a given year. For 2019, there’s no doubt that Airbus won that battle whether you measure it by orders or by deliveries, but it’s still interesting to see how the jet makers performed. That is not so much to see how one jet maker did compared to the other, but to see how they performed combined because that really shows how the Boeing 737 MAX crisis is affecting the industry.
In this report we will have a look at the Boeing and Airbus deliveries during 2020 and attach a value to those deliveries.
In order to make the comparison between Boeing and Airbus more useful, aircraft have been divided into the following categories:
- Small single aisle (Airbus A220)
- Large single aisle (Airbus A320ceo (family), Airbus A320neo (family), Boeing 737NG including P-8A and C-40A, Boeing 737 MAX)
- 200-300 seat aircraft (Airbus A330-200, Airbus A330-300, Airbus A330-900, Boeing 787-8, Boeing 787-9)
- 300-350 seat aircraft (Airbus A350-900, Boeing 787-10, Boeing 777-200LR)
- 350-plus seat aircraft (Airbus A350-1000, Boeing 777-300ER, Airbus A380 and Boeing 747-8)
- Freighters (Airbus A330-200F, Boeing 767-300F, Boeing 777F, Boeing 747-8F)
- Tankers (A330 MRTT, Boeing KC-46A)
Table 1: Deliveries per segment Boeing and Airbus (Source: AeroAnalysis International)
Boeing officially reported 380 deliveries while Airbus reported 863 deliveries. Airbus deliveries increased by 63 units or 8% in total driven by 44 higher single aisle deliveries and 19 more wide body aircraft primarily driven by higher Airbus A350 deliveries. Boeing deliveries on the other hand decreased by 426 units driven by a decrease of 453 single aisle deliveries offset by an increase of 27 wide body deliveries which was driven by higher Boeing 787 deliveries. All with all, single aisle deliveries decreased by 409 units. For those thinking that Airbus can easily scale production to fill the gap the Boeing 737 MAX, the decline in total deliveries on the single aisle segment gives you the answer.
In aggregate, wide body deliveries increased by 46 units driven by higher freighter and tanker deliveries and higher Boeing 787/Airbus A350 deliveries. Total deliveries fell year-over-year by 23% or 363 units due to the Boeing 737 MAX crisis and that really shows how important the Boeing 737 MAX is to the commercial aerospace industry.
Boeing and Airbus 2019 wide body delivery value single aisle: $44 billion
Boeing and Airbus were both set for record single aisle production in 2019, before the MAX crisis hit. Airbus had some problems in the supply chain and assembly of their Airbus A321neo aircraft with Cabin Flex interior but still managed to put out a record number of single aisle jets. Boeing was forced to halt deliveries of the Boeing 737 MAX which was to form the bulk of deliveries in 2019. While output should have topped 1,300 deliveries in 2019, single aisle deliveries fell sharply.
Boeing and Airbus 2019 wide body delivery value widebodies: $65 billion
Switching to widebody to the 200-300 seats segment, deliveries remained stable. Boeing 787-9 accounted for 66% of all deliveries in the segment but were down, while Airbus accounted for nearly 30%. The remainder of the deliveries were Boeing 787-8 deliveries. What we are seeing is Airbus A330 deliveries being slightly higher (four units), while Boeing 787 deliveries in the 200-300 seat segment were six units lower. In the 300-350 seat segment, Airbus is currently ruling with 87 Airbus A350-900 deliveries vs. 35 Boeing 787-10 deliveries (offsetting the lower Boeing 787-9 deliveries). Deliveries in the segment were up 28 units. In the 350-plus seat segment, deliveries fell slightly due to lower Boeing 777-300ER and Airbus A380 deliveries, partially offset by higher Airbus A350-1000 deliveries. What we are seeing is that deliveries in the 200-300 seat segment and 350-plus seat segment remained stable because of higher Airbus A330 and Airbus A350-1000 deliveries while deliveries in the 300-350 seat segment increased due to a combination of higher Airbus A350-1000 and Boeing 787-10 deliveries. The Airbus A350 certainly seems to have the generation advantage as the first Boeing 777X aircraft won’t be delivered until 2021, and it remains to be seen whether that aircraft can effectively compete with the Airbus A350. Passenger wide body deliveries increased by 20 units, but that increase was fully carried by Airbus.
On the Freighter market, Boeing’s reign is clear. The jet maker has a complete line up in the form of the Boeing 767F, Boeing 777F and Boeing 747-8F vs. Airbus, which only has the Airbus A330-200F. The preference for Boeing’s freighter product is clear.
For the wide body segment, Airbus ended up with 173 deliveries vs. 253 for Boeing. Boeing is still the biggest supplier of wide body aircraft, but it’s Airbus that set the bigger steps on the passenger wide body market, while Boeing increased wide body output due to higher freighter and tanker deliveries. I think that could be indicative of jet makers meeting the limits of demand on the wide body passenger market.
Table 2: Deliveries per segment Boeing and Airbus (Source: AeroAnalysis International)
Figures in $ millions
Note: Values may vary from numbers reported by other media outlets due to different base market values being used.
It shouldn’t come as a surprise that Airbus beat Boeing by a wide margin. More interesting to note is that year-over-year, Airbus grew the delivery value of its single aisle jets by $3.1B while it grew its wide body delivery value by $4.1B for a 13% year-over-year increase totaling $63B. Boeing saw its single aisle delivery value decline by nearly $22B, though it should be noted that there’s $20B worth of Boeing 737 MAX aircraft that’s awaiting delivery. Widebody delivery value increased by $5B driven by freighters and tanker deliveries (90%), while passenger wide body accounted for the remaining 10%. Boeing saw its delivery value decline by 26% while Airbus and Boeing combined saw delivery value fall by 9% from $119B to $109.5B.
Conclusion: Boeing and Airbus delivery value down 9% in 2019
We can’t really draw a conclusion other than that Airbus easily won the delivery battle this year. For years, the delivery value tally had been used by Boeing investors to point out the strength of the company. That same tally is now in Airbus’ advantage. Due to the absence of the Boeing 737 MAX, the value share of wide body aircraft increased from 47% to 60%, partially driven by higher Boeing 787 and Airbus A350 deliveries. What I found noteworthy is that year-over-year the delivery value decreased by 9%, that really shows how big this crisis that Boeing is going through really is. On top of that, when comparing the delivery values compared to last year, the absence of the Boeing 737 MAX and a multi-year recovery trajectory do not bode well for Boeing.
From the 2019 order numbers we could already see that Boeing was meeting its limits on how much it could scale wide body production as the company meets the demand limits for passenger wide body jets and the delivery distribution shows that Boeing primarily relied on tanker and freighters to increase wide body delivery value. So, for further growth Boeing relies on single aisle production, while the Boeing 737 MAX remains grounded until Q2-Q3 2020 and after 2020, Dreamliner production will come down. Once the Boeing 737 MAX is cleared for service, the delivery stream will steam up, so we should be seeing a bump in delivery value in 2020, but beyond that part of the increase in single aisle production will be there to offset lower production plans on the Boeing wide body programs. So, Boeing relies on scalability of the Boeing 737 MAX to grow its revenues again and the company should be reminded how important the single aisle business is due to its unique scalable nature, something that the wide body segment definitely lacks.