Order Book Stangent As 737 MAX Issues Persist

Boeing's troubles with the 737 MAX is impacting its order book for all of its airplanes. The company reportedly logged no new orders for any aircraft in April.

CNN reports that the company has received no new orders for 737, 777 or 787 airplanes, according to a report released Tuesday. The last orders received by the company were 20 Dreamliners from Lufthansa, and 18 777X airplanes from British Airways. Both of those orders were received in March.

Standard & Poors credit analyst Philip Baggaley told CNN that in his view, airlines are holding off to see if the planemaker starts to lower prices in light of its problems with its workhorse single-aisle airplane. But he said it would probably not be direct cash compensation, but rather lower prices on future orders, or non-cash considerations in existing orders.

Airlines such as United and Norwegian have said they are anticipating some kind of compensation offer from Boeing due to the grounding of the 737 MAX airplanes.

Orders have been down for both Boeing and Airbus so far this year due largely to massive orders in the past several years which will have the assembly lines for both companies churning for years. Teal Group aerospace analyst Richard Aboulafia told CNN that Boeing had a "God-awful first quarter" on its order book due to a "massively over-ordered environment."

Additionally, the Paris Air Show is being held next month, and airlines often hold back on ordering aircraft prior to the show so that they can make major announcements during that week.

(Image from file)

FMI: Source report