For several years now, the news from Boeing has been negative. This has made for awkward company communications, and one sympathizes with the team that has to find a way to break the news. This year, though, there's something big happening at Boeing that we haven't officially heard about. The new CEO has kept the team focused, and that team is delivering. The news is downright exciting. It's week three of January, and Boeing is handily ahead of Airbus in deliveries. When did you last read that Boeing is beating Airbus? January Deliveries The table is current through the morning of January 23. Boeing benefits from pent-up demand and a helpful inventory. That inventory wasn't always a good thing. [caption id="attachment_89374" align="aligncenter" width="504"] AirInsight[/caption] The MAX inventory has proven valuable for growing Boeing's Indian customer base. Akas and Air India Express have taken aircraft intended initially for Chinese customers. China Returns The following chart shows the return of Chinese customers. [caption id="attachment_89376" align="alignright" width="303"] AirInsight[/caption] China was a significant MAX customer until the grounding. China was the first country to ground the MAX. The highlighted customers are Chinese. The return of Chinese deliveries has to be a great relief to Boeing. In an earlier post, we noted that there were approximately 50 MAXs destined for China in inventory. The Air India Express delivery was formerly a China Southern MAX, and the GOL delivery was a former Southwest MAX. Boeing's marketing and sales team have shown creativity in remarketing NTUs. We are likely to see a few more next month. Two we are watching are an El Al 787, originally for Air China. A 787 for TAAG was seen in Riyadh colors a few years ago at the Dubai show. The list shows how important United remains as a customer. United has been vocal about its dissatisfaction with delayed deliveries. Southwest is another crucial customer, but it is taking MAX 8s when it needs a much delayed MAX 7. The delayed certification of the MAX 7 and MAX 10 weighs on these two big customers. Of course, slow 787 deliveries also impact customers. Then there's the 777X program, which is now years late, but its test flights have restarted. Boeing is working through many production issues. According to the latest report from GE, in December, production of LEAP engines declined by 5% from a year ago. Delayed MAXs impact the supply chain. Aging Inventory We described the aging inventory going to India. This table lists the aging MAXs for January that have gone to customers. [caption id="attachment_89378" align="aligncenter" width="522"] AirInsight[/caption] Many of these airplanes are old and had to go through software and other updates. However, the table shows that Boeing is working through that MAX inventory and finding creative ways to dispose of it. Even at deep discounts, these aircraft will provide two decades of revenue from spares. Moreover, having a customer in hand is better when a fleet update process starts. Summary Boeing has endured a brutal past half-decade, but this may be the end of the rough period, provided there are no more "unknown unknowns." What is clear already is that Boeing has returned to production, even under FAA limits on the MAX. Even more importantly, Boeing delivers at rates not seen in a long time. The following chart makes that clear. [caption id="attachment_89379" align="aligncenter" width="662"] AirInsight[/caption] January isn't over yet; we will not be surprised if January 2025 is the highest month on this table next month. Boeing is off to a great start this year.
