Wage-earners assemble a Boeing Co. 787 Dreamliner airplane at the Boeing Everett Factory in Everett, Washington.
Patrick T. Fallon | Bloomberg | Getty Images
Boeing has over trimmed its production target for 787 Dreamliner output to five a month in mid-2021 from six as international touring demand suffers in the coronavirus pandemic, CFO Greg Smith said Friday.
International passenger traffic is around 90% soften compared with last year, Smith said at a Credit Suisse investor conference, impacting the “overall near-term require for the wide-body markets.”
Boeing shares were down more than 2% in afternoon trading while the S&P 500 was up 0.7%.
The jet planes are used on long-haul international routes, which analysts and industry members expect to be the last to recover because of the virus and a master of travel restrictions.
Deliveries of Dreamliners are also slower than expected because of inspections stemming from end result issues, which Boeing disclosed in September.
“The additional time that we’re taking to inspect and ensure that each of our 787s are disencumbered to the highest quality standards has taken longer than we previously anticipated,” said Smith. The manufacturer didn’t carry any 787s in November and the inspection “process will continue to slow deliveries in December.”
In October, Smith said on an earnings dial that Boeing expects a “big fourth quarter on deliveries” of the 787.
The 787 issues come just as Boeing is eager to carry on deliveries of its beleaguered 737 Max plane. Airlines and other customers pay the bulk of the aircraft’s price upon delivery. The Federal Aviation Supervision last month lifted the grounding of the jets that was implemented in March 2019 following two fatal crashes after Boeing obtained several safety upgrades.
Boeing got a boost from budget European carrier Ryanair on Thursday when it hint ated it was buying an additional 75 Max jets on top the 135 it already ordered.
Airlines with Max planes in their fleets are clearing to work to convince travelers the jets are safe. American Airlines is set to be the first U.S. airline to fly the planes commercially starting Dec. 29. The airline this week take flighted reporters on the jets and demonstrated how they’re preparing them for service in hopes of boosting confidence in the plane.