© Reuters. FILE-PHOTO: FILE-PHOTO: The Boeing logo is shown at the LABACE trade fair in Sao Paulo
By Ankit Ajmera and Eric M. Johnson
(Reuters) -Boeing Co reported a smaller quarterly loss on Wednesday as jet deliveries increased due to the recovery in air traffic from the coronavirus pandemic, despite the U.S. aircraft maker filing an indictment on its Air Force One presidential aircraft program.
Airlines have increased their flight capacity as vaccination rates rise, making travelers confident about traveling again.
Boeing (NYSE 🙂 has shipped more than 85,737 MAX jetliners after most regulatory agencies approved recommissioning after two fatal accidents late last year, increasing sales and cash flow for the aircraft manufacturer.
However, the 737 MAX remains anchored in the rebounding Chinese market, where Boeing has long faced simmering geopolitical tensions that persisted under US President Joe Biden.
A new electrical issue that emerged on some models of the jet earlier this month also dwarfed Boeing’s newly confirmed plans to increase 737 MAX production to 31 aircraft per month by early 2022. Airlines have taken dozens of 737 MAX jets out of service and await repairs while Boeing finds a solution.
“As the global pandemic continues to challenge the broader market environment, we see 2021 as a major turning point for our industry,” said Dave Calhoun, chief executive, in a statement on Boeing’s results.
Boeing also confirmed a sharply reduced production rate of five 787 jetliners per month after production was consolidated at its South Carolina facility.
Because of the impact of the pandemic on long haul travel, demand is lower and the price of 787 retrofits is rising due to manufacturing imperfections embedded in dozens of the advanced jet composite jetliners.
The first 777X mini-jumbo is still expected to ship in late 2023, despite certification and design challenges, with a combined performance of the new 777X and its 777 legacy model of two per month.
The US aircraft maker reported a core operating loss of $ 353 million for the first quarter ended March 31, compared to a loss of $ 1.70 billion a year earlier.
Boeing announced it had a $ 318 million pre-tax charge for the quarter related to a new fleet of Air Force One presidential aircraft based on its 747-8 jumbo jet.
Air Force One’s subcontractor, GDC Technics, filed for bankruptcy Monday after Boeing terminated its contracts.
Boeing sued Texas-based GDC earlier this month for failing to complete interior work on the two heavily modified 747-8 Air Force One aircraft. The GDC countered the aircraft manufacturer last week, demanding at least $ 20 million to terminate the contracts.
On the positive side, a hot-fire engine test for NASA’s upcoming SLS rocket was completed and production started on the US Air Force’s new trainer jet.
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