Boeing Reports Dismal Q3 Commercial & Defense Deliveries

The Boeing Company BA recently revealed delivery figures of its commercial and defense operations for the third quarter of 2020. The figures reflect a massive 54.8% decline in commercial shipments from the previous year tally, while defense shipments also plunged 108.1%.

Combining both segments, Boeing’s total deliveries in the third quarter were merely 65 units compared with 170 units delivered in the year-ago period.

Q3 Commercial Deliveries Details

Boeing reported commercial deliveries of only 28 airplanes in third-quarter 2020, declining significantly year over year, primarily induced by dismal 787 Dreamliner jet and 767 deliveries as well as lower deliveries of 737.

Shipments of the 787 Dreamliner totaled 13 compared with 35 in the year-ago period. The company delivered only six 767 jets during the quarter compared with 10 767 jets sold in the year-earlier quarter. Meanwhile, delivery of the single-aisle 737 jets fell to three in the period from five a year ago. Shipments of the 777 model totaled five compared with 11 in the previous year’s third quarter.

Factors Causing Poor Delivery Figures

Over the past few quarters, demand for Boeing's 737 jets has relatively remained low following the consecutive crashes of its two 737 Max 8 jets in March 2019. Furthermore, as the impacts from the coronavirus pandemic continue to cripple aircraft demand since March 2020, Boeing had to again encounter a significant drop in aircraft deliveries.

Moreover, as air traffic slowed down sharply due to the prolonged pandemic impact, new aircraft that were supposed to get delivered are now lying idle in Boeing's manufacturing plants. Meanwhile, quality flaws in 787 Dreamliner might have hampered the delivery flow of this product line during the quarter after a manufacturing problem affecting the horizontal stabilizer on 787 was being detected.

Boeing vs. Airbus

Considering the 28 aircraft deliveries made by Boeing, Airbus SE EADSY remained ahead in terms of deliveries made, as the European aircraft giant delivered a total of 147 commercial aircraft in the third quarter of 2020. Evidently, in terms of commercial deliveries, Boeing’s arch-rival remained quite a step ahead during the third quarter.

A Brief Look at Boeing’s Defense Deliveries

In its defense and space business, Boeing’s deliveries totaled 37 in third-quarter 2020, which deteriorated from 77 dispatched in the prior-year period.

Such a bleak delivery figure can once again be attributed to coronavirus-led business restrictions that reduced and in some cases, paused shipment activities within the United States as well as across borders. We now wait to see how other jet manufacturers like Lockheed Martin LMT and Embraer ERJ report their delivery numbers for the third quarter, which might also reflect adverse impacts of COVID-19.

Price Movement

Boeing’s stock has plunged 56.3% in the year compared with the industry’s decline of 24.3%.

Zacks Rank

Boeing currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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The Boeing Company (BA): Free Stock Analysis Report
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