Supply Chain Matters highlights Airbus and Boeing Q1-2023 commercial aircraft delivery and net orders performance. While Boeing outpaced in quarterly aircraft deliveries, a reported component manufacturing issue does not bode well for meeting full year aircraft delivery objectives.
Airbus Q1-2023 Operational Performance
Commercial Aircraft Deliveries
European based commercial aircraft producer Airbus reported total commercial aircraft deliveries of 127 aircraft for the first quarter of 2023, representing a 9 percent decline from the year earlier period. Nearly 68 percent of the total Q1 aircraft deliveries occurred in March, a classic sign of supply chain challenges.
The breakdown in quarter consisted of 116 single aisle aircraft including the Airbus A320 and A220 family of aircraft, and 11 wide aisle aircraft among two models.
With a stated 2023 total aircraft delivery target of 720 aircraft, the Q1 performance falling short of the 180 threshold number already provides added pressure for Airbus to make up the difference in the final three quarters.
The European producer did not meet its originally stated 2022 aircraft delivery performance because of ongoing supply chain supply challenges. Airbus CEO Guillaume Faury indicated to reporters at the start of 2023: “The headwinds of the complexity of the supply chain remains in 2023. And it will be challenging, it will remain challenging to ramp up in this environment.” While shortages of aircraft engines were previously a challenge, the current supply chain challenges reportedly focus on other components.
Q1-2023 Net Orders
Airbus reported a total of 142 net orders were reported for Q1 consisting of 100 single aisle aircraft (A220, A320) and 42 wide aisle aircraft (A350).
Boeing Q1-2023 Operational Performance
Commercial Aircraft Deliveries
U.S. based Boeing managed to surpass rival Airbus in reporting a total of 130 commercial aircraft deliveries during the past quarter. Of the aircraft delivery total, 113 (87 percent) involved the Boeing 737 MAX aircraft family. Similar to Airbus, quarterly aircraft delivery was skewed toward the final month of the quarter, amounting to 64 aircraft.
The breakdown in quarter consisted of 113 Boeing 737 family, 11 787 Dreamliner, 4 Boeing 777 and one each of Boeing’s 747 and 767 aircraft.
Q3-2023 Net Orders
Boeing reported a total of 120 net new orders for Q1-2023 consisting of 85 737 MAX, 20 787 Dreamliner, and 15 767 aircraft.
Boeing 737 MAX Production Pause
Late last week, after the reporting of Q1 delivery performance earlier in the month, the U.S. aircraft producer again made industry headlines with a statement indicating that an aircraft delivery pause is in effect for some models of 737 MAX aircraft because of an incorrectly assembled part related to the aircraft fuselage assembly.
Boeing was reportedly notified by fuselage supplier Spirit AeroSystems of a “nonstandard manufacturing process” involving the installation of two fittings where the fuselage is attached to the tailfin. The specific models reportedly affected are the Boeing 737 MAX 7, MAX 8 and MAX 8-200 aircraft along with the military P-8 reconnaissance version of the MAX. The MAX 8 is noted as the most popular model among airline customers. Supplier Spirit AeroSystems is reportedly working on an inspection and repair procedure.
Boeing has stressed that the problem does not pose an “immediate safety of flight issue and the in-service fleet can continue operating safely.” The aircraft producer has not indicated how many total aircraft are involved in this pause, nor the overall timing of repairs.
According to reporting from business broadcasting network CNBC, Boeing indicated in a statement that this issue is likely to affect a significant number of undelivered 737 MAX airplanes, both in production and in storage. Boeing further indicated:
“We expect lower near-term 737 MAX deliveries while this required work is completed. We regret the impact that this issue will have on affected customers and are in contact with them concerning their delivery schedule. We will provide additional information in the days and weeks ahead as we better understand the delivery impacts.”
Long time Seattle Times aerospace industry reporter Domenic Gates tweeted that it is believed that this problem may date back four years and possibly affect most of the planes built since the original grounding of the aircraft in 2029.
News of this fuselage assembly issue prompted Boeing stock to decline nearly 7 percent while shares of Spirit AeroSystems reportedly fell upwards of 20 percent.
As we pen this posting Boeing CEO Dave Calhoun indicated at today’s annual meeting of stockholders that “the flaw detected in some of its 737 MAX aircraft will not hinder supply chain plans for increased production.” Calhoun further indicated that the company is not changing its schedule with suppliers, including “anticipated rate or expected inventory increases.”
Summary Thoughts
The net-net of both Airbus and Boeing’s Q1-2023 commercial aircraft operational performance was that supply network and production challenges remain, providing each of these rivals added challenges for the coming quarters. Some relate to supplier delivery performance and in the specific case of Boeing, manufacturing process and quality control shortcomings that continue to manifest themselves with the 737 MAX family of aircraft.
© Copyright 2023, The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.
