Boeing topped Airbus in aircraft orders at the Farnborough Airshow for the first time in four years. CEO Kelly Ortberg's visibility and the 173-plane tally signal airlines still have faith in the turnaround, analysts said.
Boeing edged past Airbus in the order tally at the Farnborough Airshow for the first time in four years. The American planemaker announced deals for 173 aircraft; its European rival booked 154. The result suggests that airlines and lessors are still placing bets on Boeing as CEO Kelly Ortberg's turnaround effort tries to rebuild trust after the 2024 Max door-plug blowout and years of delivery delays.
Ortberg was highly visible at the show. He took a front-row seat for an order signing and spoke at a media reception. The hands-on approach he adopted when he took the helm two years ago – including moving to Seattle to be closer to the factory floors – was on display.
Augusto Viansson Ponte, a director at Alton Aviation Consultancy, called Ortberg's visibility "a good sign."
"I think what was very interesting was quite a bit of Boeing [orders], which means people have faith," Viansson Ponte said. "They were in a pretty bad spot a while ago, and I think that there is confidence from the operators in the fact that they will resolve that."
The orders tally was a reversal from recent years. Airbus had dominated the Farnborough and Paris airshows as Boeing contended with the fallout of the Max crisis and production issues on the 787 and the yet-to-be-certified 777X. In Paris last year, Boeing chose not to announce any orders at all after the crash of Air India Flight 171.
"As I continue meeting with our customers, suppliers, and partners, they all say the same thing: a different, better Boeing is showing up," Ortberg said in a memo to employees Tuesday. He added that there is more work to do and that "two quarters don't make a year."
Boeing is still losing money. The company reported a $428 million loss in the second quarter on $24.6 billion in revenue, weighed down by a $280 million charge tied to the Air Force One replacement program. Its share price is down roughly 8% over the past year. Still, revenue rose and commercial deliveries increased in the quarter. The stock rose about 5% on Tuesday.
"We believe investors appreciate the steady stair-step progress that Boeing is making on deliveries, production increases, and free cash flow generation," Ken Herbert, aerospace and defense analyst at RBC Capital Markets, wrote in a note.
Deutsche Bank analysts, who rate the stock a hold, said Boeing is "continuing to demonstrate improvement in executing against the strong demand environment."
This year's show lacked the excitement of previous editions. Qatar Airways canceled its presence after the country's former emir died earlier this month. Etihad Airways' CEO withdrew from planned engagements. The largest order came from a lessor, SMBC Aviation, which ordered 100 airplanes from both Boeing and Airbus.
"Probably because the airlines have ordered a lot and swallowed a lot in the past," Viansson Ponte said. "They put their growth plans and their orders in terms of, this is what we want to do, we know when those deliveries are. Now it's the turn of the lessors to come in with the flexibility."
Riyadh Air, the Saudi startup, announced deals for 28 Boeing 787s and six Airbus A350-1000s. It had already ordered much of what it needs over the past two years. The Iran War has led to a decline in passenger demand for Middle Eastern airlines and may make them wary about buying new airplanes.
Perhaps the biggest headline of Farnborough came from the 777X's biggest customer. Emirates President Tim Clark told The Telegraph that the airline is rejecting the first 10 777X jets built for it. The type was supposed to enter service in 2020, the first is now expected in 2027. Its long path to certification has led to design changes. Clark believes the first batch would require too much work to bring them up to an acceptable standard.
"As far as we're concerned, what they do with them is up to them," Clark said. "Heinz would be interested – baked bean cans."
During Boeing's second-quarter earnings call Tuesday, Ortberg said he would not discuss contract changes publicly.
On the BA stock page, AlphaScala rates Boeing at 39/100, labeled Mixed. The score reflects the tension between improving commercial deliveries and persistent losses on fixed-price defense programs. RBC Bearings, a supplier to both Boeing and Airbus, carries an Alpha Score of 48/100, also labeled Mixed.
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