Leeham News and Analysis
There's more to real news than a news release.
There's more to real news than a news release.
Boeing takes $4.9bn charge in 3Q against 777X; reports slightly improved quarter YOY
Oct. 29, 2025, (c) Leeham News: Boeing takes $4.9bn charge on 777X in 3Q2025 earnings report. Loss from operations: $4.78bn vs $5.76bn year-over-year; net loss $5.34bn vs $6.17bn YOY. Cash flow +$1.1bn vs ($1.34bn) YOY.
More to come shortly….
@ Vincent
Here you go:
“…GAAP loss per share of ($7.14) and a core loss per share of ($7.47)”
Much, much worse than what analysts had expected 🙈
It amounts to a (20.5)% loss.
Stunning! BA generates $23.27B revenue in Q3, and a fifth of it goes down the toilet.
The margin at BCA specifically was (48.3)%.
After a deduction for “additions to property, plant and equipment”, Q3 cashflow was just $238M, with YTD (negative) cashflow being $(2.252)B.
Still trying to figger out how Boeing got from est ~ $-1.50 a week
ago to the $-7.47 EPS announced..
Analysts failing to see/understand reality…
A “foundation” for future profits. Look only for the upside or you can’t survive for long in WS.
“It’s difficult to get a man to understand something when his salary depends on
his not understanding it.”
-Upton Sinclair
You are comparing chalk and cheese.
‘generates $23.27B revenue in Q3, and a fifth of it goes down the toilet.’
The 777x loss is over the life of the program accounting number. It’s reach forward for a reason. Mostly it’s accounting charges.
Revenue should be compared to free cash for the quarter
There’s *always* an extra charge of some sort in Boeing’s quarters…it just varies in size/nature from quarter to quarter.
Cashflow for Q3 came solely from received customer deposits (see below) — not from (negative) earnings.
Customer deposits is still revenue.
“Advances and progress billings in the quarter amounted to $2.065B; without those, cashflow would have been (very) negative.”
It was negative last 2 x 2025Q.
Your business ideas wouldn’t run a corner shop
meanwhile looking into your backyard for Comac
public information from 2025 and earlier indicates the company is financially stable due to significant state funding, despite ongoing challenges with its commercial aircraft programs…
Multiple aviation reports in September 2025 indicate COMAC has significantly reduced its C919 production target for the year.
Reports suggest the company lowered its 2025 goal from an earlier target of 75 aircraft to as low as 25, delivering only a handful of jets by late September.
“Customer deposits is still revenue”
No, it’s not — it’s a loan against future revenue.
That’s why it’s recorded under liabilities, until such time as delivery occurs. If contractally-valid cancellation occurs in the meantime, it has to be repaid to the customer.
***
As regards COMAC, we know it receives state funding. But so does Boeing…almost $90B since 1991 in state and federal subsidies, grants, loans and tax breaks.
@Aba
Forgive those who haven’t learnt ABC in accounting!
I also remember BA has been in aviation business for more than a century. Now our poster has no choice but try to compare it with a scrappy startup? What an irony to prove how far the titan has fallen.
TIL “accounting charge” is unreal, according to poster here.
Anyone here paying attention to the total shareholders’ deficit of BA? It’s growing larger and larger, after a successful equity raise, to almost $9 billion by my estimate.
PS: Most of us here are aware the tricks used by BA to pull cash receipts forward and delay payments to suppliers, and how much trouble it got itself into by paying attention to nothing but the FCF by the top management!
Mere flesh wounds, no worries.
LNA: “Cash burn for 2026 due to the 777X program is expected to exceed previously estimated levels of $2bn.”
Also
“While Boeing describes the current $4.9bn write-off as a non-cash charge, that description is misleading.
Yes, the current entry does not involve any cash accounts, but this is simply because those amounts have already been spent in previous periods, as LNA has reported earlier.”
How much of this is compensation to customers for late EIS, leases for replacement aircraft, etc?
Is there anybody at Leeham or here in the forum who has an idea how these contracts look like?
For example, how much would Lufthansa approximately get for their 20 779 per year of additional delay?
Average revenue per delivered plane was $11.094B divided by 160 = $69.3375M.
This is a shockingly low figure, considering that 39 of those deliveries were widebodies.
The figure over at AB is generally about $82M — which is 18% higher, despite fewer widebodies in the mix.
***
Interesting line in the earnings report:
“The 737 program stabilized production at 38 per month in the quarter”
Really? Not seeing that yet in deliveries…so “stabilized” seems to have a special, non-standard meaning here.
Perhaps the front end of the line has “stabilized” at 38/pm, but the back end hasn’t…and, therefore, “production” hasn’t, either.
Very interesting figures regarding revenue per frame Abalone.
You’re still not having Boeing producing 38 737s a month though. Don’t rely on planespotters for figures. They miss things out. For instance LN9274 was delivered in August and 9430 was delivered in September according to Boeing. You can see the delivery flights on FR24 and probably other tracking sites. Planespotters say both are still on order.
Granted that’s only two but I haven’t got the time or inclination to trawl through Planespotters lists to see what else they’re missing. These two were obvious as they’re not MAXs, but still new builds.
As I mentioned before – if an aircraft has it’s first flight it’s been produced. New build 737s figures per month since June are 36/41/36/37 and 37 so far this month with 2 and a half days to go. They only have to get to 40 this month to average 38 per month over five months.
I’m also using the monthly delivery figures from Scramble, and those figures match what BA publishes.
I don’t agree that a first flight = produced. If a plane requires re-work, painting and/or cabin fit after its first flight, then it’s not yet produced. It’s produced when it’s ready to be picked up by the customer. And since customers are eager to receive frames, non-delivery implies not ready.
Deliveries for Q3 were ca. 33, 35, 35.
Those delivery figures are perfectly respectable…but they’re not 38 p/m.
Boeing is trying to sell the hide before the beaver has been trapped.
Long-term debt is still $44.611B.
In addition to that, there’s short-term debt (to be paid within 12 months) of $8.742B.
Cash on hand is $6.173B, and short-term investments amount to $16.811B.
So, paying off that short-term debt will put a fine hole in available assets.
Moreover, accounts payable amount to $11.732B, whereas accounts receivable stand at $3.314B.
There are also $24.364B of accrued liabilities (leases, pension contributions, etc.)
Summarizing: liquid and semi-liquid assets aren’t anywhere near enough to cover “short-term” liabilities.
Advances and progress billings in the quarter amounted to $2.065B; without those, cashflow would have been (very) negative.
New borrowings in the quarter were $128M, whereas debt repayments amounted to $721M.
google AI response:
“… raising the total program-related charges to approximately $15 billion.”
and
* Reach-forward loss” position: The program’s costs have exceeded the point where they can be recovered over the first several hundred planes. As a result, any new abnormal costs or overruns must be immediately recorded as a charge to earnings.”
and this is a funny:
Barron’s
https://www.barrons.com › articles › boeing-earnings-st…
“Boeing Stock Rises After Earnings Miss and 777x Charge”
following the link show:
“Boeing Stock Falls After Earnings Miss and 777x Charge”
The US stock market rallies upward every day, even though it’s already egregiously over-valued (current average PE ratio is 28.8; historic value is around 17).
Every news item is interpreted as a positive.
Daily warnings from US analysts about asset bubbles, liquidity issues, private equity problems, etc., are all ignored, so that the “Musical Chairs on Steroids” can go on.
BA’s stock move today fits that trend.
I wonder if this is the first example of a program being in a loss provision before EIS. The ramifications are severe. Boeing must deliver its entire accounting block with no further charges to simply “make nothing. The end of the accounting block is so far into the future that this is functionally impossible.
It’s not to “make nothing” – they must deliver their entire accounting block with no further charges to make their expected return.
“…to make their expected return”.
No…to negate the recorded reach-forward loss. In other words, just to break even. Or, as @Casey puts it: “for nothing”.
@ Casey
It would be interesting to calculate the number of 777X sales that would be required to negate the reach-forward loss for the current accounting block — using realistic pricing, and including interest corrections.
An unattainable number, I suspect.
@Abalone
That is an amorphous question.
There are 626 undelivered aircraft in backlog. You can probably assume about ~ 70 of those are of the EIS config at 30/year through 2027 when production must end…so 50 beyond the accounting block are already sold.
The current accounting block is 500 aircraft. Peak deliveries in the early 2010s was 100 aircraft per year. You can probably budget a more likely number of 50/year for the foreseeable future (last time exceeding that rate was 2017). This if for a variety of reasons…not selling as well as EIS plus a lack of freighters until that certifies. For simplicity…we are looking at 10 years from first delivery until the accounting block is delivered…so 2037 at the current EIS point.
Now is an aircraft first conceived in the early 2010s still competitive in 2037…hard to say…so incremental sales are conceivably saddled with further investment (and a new accounting block).
This is now a program with no hope.
Excellent analysis.
Essentially no hope either for the 787 and MAX: those programs will also never re-coup their losses.
Current 77x backlog: 565 aircraft. Some of those are likely to be cancelled and Boeing will sell some more, so let’s assume for the sake of math that they will eventually sell 750 aircraft.
$4.9 billion carry forward loss divided by 750 aircraft is roughly $65 million per aircraft to be delivered.
777-9 list price is $442 million, so let’s assume that the realized price is somewhere in the range of $250 million. Let’s then assume that Boeing will manage 25% gross margin on these sales – that means they generate $62.5 million in gross margin (before overhead costs) – so a bit less than the per aircraft carryforward loss for the latest writedown and doesn’t include earlier writedowns.
“$4.9 billion carry forward loss divided by 750 aircraft is roughly $65 million per aircraft”
you mean with what has accumulated till now? 4,9 bn divided by 750 is only 6,5 mio not 65 mio
Oops – thanks for fixing the math.
Per @Uwe above:
BA has recorded a total close to $15 billion accounting charges/reach forward losses for the 777X program.
“… raising the total program-related charges to approximately $15 billion.”
That’s like $30 million per aircraft.
This quarter’s $4.9B charge isn’t the only one that has been levied on the 777X program — the cumulative reach-forward loss is much larger:
“As of June 30, 2025, Boeing’s cumulative reach-forward losses and abnormal production costs for the 777X program have ballooned to over $10.7 billion. With the latest potential delay to 2027, analysts estimated that the sum could grow to more than $14 billion”.
10.7 + 4.9 = 15.6
That’s $20.6M per plane for your 750-unit accounting block.
Further: your actual sales price is far too optimistic. Boeing is giving discounts closer to 60-65% — our resident accountant guy @ Frank P has calculated this on several occasions by comparing revenue to list pricing.
And lastly: when was the last time that BCA made a positive margin on delivered aircraft?
Those writedowns are real losses.
i.e. and IMU Boeing has accumulated cosst that overflows the deferred cost basket.)
outlay that can not be recovered in the projected production block ( deferred cost ).
So really what has Ortberg really changed since he took over? He really didn’t clean house like I was hoping for and really change the culture. Results so far just appear to be same ole, same ole. I mean the whole push was for him to really clean up the executives and get Boeing back on an engineering path but here we are so far with the same results, not sure what else to say, not sure with the current leadership Boeing will ever return to anywhere near what it was….sad.
“So really what has Ortberg really changed since he took over?”
Don’t over-think, what’s important is the stonk is up. A facelift for the Potemkin Village.
+1
His fans will say:
“Kelly is doing a great job turning the corner — just give him more time”
🙈
Meanwhile, rather than settling the ongoing strike in St. Louis, Kelly wants to just replace the striking workers:
-Walmart assistant: “Hello sir, how can I help you?”
-Kelly: “I’d like several boxes of ready-to-use, qualified aerospace workers, please.”
-Walmart assistant: “Certainly sir — aisle 5, at the back on the right. And we have a “2+1 free” offer this week.”
https://www.cnbc.com/2025/09/04/boeing-replacement-workers-defense-unit-strike.html
Boeing needs “real honest-to-God product development:” ex-CEO
https://leehamnews.com/2023/01/10/boeing-needs-real-honest-to-god-product-development-ex-ceo/
From Phil Condit nonetheless!
An excellent idea.
No worries. Investors don’t mind one-off charges, that’s how brokerages recommend stonks to “investors”.
Way too much focus on the earnings and stock price in the comments, which led to Boeing’s original sin. Focus should be on the people and products, which is what Ortberg has brought back. Not sexy but it’s what you need to make great airplanes.
Good grief!
> Boeing rejects union’s counteroffer; St. Louis strike continues
https://fox2now.com/news/missouri/boeing-rejects-counteroffer-union-says-st-louis-strike-continues/
A mockery of “focus on the people”.
“…it’s what you need to make great airplanes.”
You can’t make anything without income.
Boeing long ago sailed into the “too big to fail” waters. It’s our largest export from the manufacturing sector. Trump inks new deals for Boeing with every country he visits. Develop great products and take care of your people. If you’re so focused on the numbers you will never take the necessary risks to develop a great airplane.
” Trump inks new deals for Boeing with every country he visits.”
How many of those “TrumpDeals” have materialized?
or have a chance of ever materializing?
Not sure when or if Boeing is eager to take the necessary risks to develop a great plane. Never mind how much capability has left…
Economic coercion is real and posters are proud of that. Be prepared to reap what you sow.
Boeing posts a $-7.47 EPS for the third quarter of 2025.
777x delayed to 2027… They should launch the 737 replacement now so it’s EIS’d by 2040.
Don’t know if this is hilarious or terrifying.
@Sherlock
You are not the first one to come to that conclusion. There has been a lot of noise about bringing back development cycles to something like 5 years…and if anything it has gone the opposite direction.
The whole system for certifying aircraft (at least at Boeing) has fundamentally broken. It is certainly not getting better for anyone else.
Just the other day it was “mid-2026 deliveries” for the Boeing 777-x.
Crazy.
Its time for Boeing to come clean with all issues at hand If they can’t deliver 777x then cancel the program
How could they?
Every time they look they find a new “Schrödinger’s cat” issue.
Historically issues where “fragmented” and the shards pushed into the walls. This allowed to project issue free processes ( until something with sharp corners grew back out of the walls like MCAS )
It’s ALL the uncooperative FAA’s fault! 😄
Ortberg is eager to “swing back” the pendulum so that BA can be “great” again! It’s Job #1! Just watch them.
AFAICS:
the only way Boeing can have a new modern NB type
_in a reasonable time frame_
is taking out a license from Airbus. ( and massive aid in a franchise system )
Take a cue from automobiles: what type is actually designed in the US these days? ( don’t count the 1930ties small trucks )
BDS managed to eke out a tiny sliver of profit in Q3.
Revenue: $6.902B
Earnings: $114M
Margin: 1.7%
Delivery situation month-to-date on Planespotters (16:55 CET) — line only:
A320/A321neo: 41
A220: 4
A350: 6 (including 3 for Emirates)
A330neo: 1
B737MAX: 31
B787: 4
B777: 2
B767: 2+ 3 (civilian + KC46A)
Emirates now has 12 A350s in service.
Will Emirates receive their first enhanced Trent XWB-97 before the 777-9?
Airbus results are out.
For first 9 months of 2025:
Revenue: €47.436B
EBIT (adjusted): €4.146B
EBIT (reported): €3.365B
EPS: €3.34
Commercial aircraft:
Revenue: €33.866B
EBIT (reported): €2.556B
Deliveries: 507
So, average revenue per aircraft = 33.866B/507 = €66.8M = $77.4M
Deliveries comprised: 62 A220s, 392 A320 Family, 20 A330s and 33 A350s
https://www.airbus.com/en/newsroom/press-releases/2025-10-airbus-reports-nine-month-9m-2025-results
53 widebodies in 3 quarters equates to 18 widebodies per quarter.
BA had more than twice that number in Q3 — 39 frames — and it still managed to generate only $69.34M average revenue per frame, versus $77.4M at Airbus.
The Airbus figure is 11.6% higher than the Boeing figure.
Normally, this figure is even higher — but Airbus has had lower-than-planned widebody deliveries so far this year.
Hey when the product is not/less competitive, there’s only one lever left to pull in order to “sell well”.
Finally I get a minute to chime in on this. There is only 1 way this is good news. If this was the end of the charges on the 777x. If it were, I might accept it as a point where goodness can proceed. I just dont see it. When I left, it was hard to staff with skilled people and the veterans holding down the fort were getting killed by the workload. Its worse now as there aren’t enough airplane people to lead the building of airplanes. Nobody is pointing to what I feel the actual problem is. It’s a producibility issues. Airbus sircraft are easier to build and take far less assembly worker skill to make rate. Airbus spent the engineering money more effectively when it comes to way the parts come together. You can interchange line workers in an Airbus plant because even though the parts will differ location to location in the product, the assembly processing is close enough to being standardized that the learning curve actually works the way the statistical model says it should. Here’s why, Boeing builds airplanes with a lot of wiggle room in the tolerance zone. It will always go together, but the amount of fiddling around to make things go together can be high while you are figuring out your best way to do your job. Airbus spends a lot of money on the producibility of the process, and it pays off in lowering the artistic skills needed to make the assembly processes work. At Boeing, inside Mfg Engineering, we speak of “Magic Fingers”, those artists in the workforce that can easily massage any bag of parts into great product. It shouldn’t take magic fingers to make great product, ease of assembly should be engineered into the airplane. Proof of this stuff is in Renton, one of the big reason they give for the plug door falling off the airplane is that they said the DOOR TECHNICIANS were on vacation. This is the public admission that this door removal/reinstallation process relied on Magic Fingers.
I’m afraid that there are so many places in the Boeing manufacturing process relying on artistry to build the airplane that you won’t be able to staff them, and with that, you never truly stabilize the process. Note that you need to grow enough new magic fingers to staff up the new Everett production line, and that will diminish, temporarily, the ability to sustain 38 in Renton, or whatever the rate ia when thw north line starts up.
What does all this drivel mean?… I think its unreasonable for the new airplanes to reach the labor touch hours they are being sold for because the bean counters setting sales prices don’t live in a world where these facts are considered. After all at Boeing you’re not longer the company’s most important asset, you’re their most easily trimmed cost……
“Boeing builds airplanes with a lot of wiggle room in the tolerance zone.”
Tolerances and interfaces are the central levers in production.
( one watershed is when you move from needing tolerance check/selection on every item versus producing fully in the tolerance window and only needing random sample survey to prove that production centers the window. laxness in all forms of interfacing comes at (significant) cost.)
Boeing seems to have never mastered this.
“You can interchange line workers in an Airbus plant because even though the parts will differ location to location in the product, ”
IMU you err here too.
Airbus workers are qualified to a higher standard than you can find in the US. and the qualification is more abstract than task specific.
Not Airbus but you get the gist:
https://www.handelsblatt.com/unternehmen/industrie/fachkraeftemangel-in-den-usa-deutsche-unternehmen-werden-zu-bildungsinstituten-01/100033183.html ( use translation )
and afaics it is not “dearth” of sufficiently qualified people but they just don’t reach those levels.
Non US manufactureres active in the US self train and qualify their workforce ( or founder )
The recently-announced EFW exit from the US illustrates the same point.
EFW’s employees in Europe and Asia can read a manual and then perfectly execute the instructions in that manual.
EFW’s employees in the US are unable to do this — they have to be shown what to do, and supervised while they do it…again and again. A totally unworkable situation.
Uwe
There is the entire subject of the differences between the American unionized workforce model and the German Union model. The existence of IGMETALL, a union requiring continuing education of its membership conceptually deploying an apprentice to journeyman process within its workforce does in fact do exactly what you say. It does make their workforce, on average, better than their US counterparts. No Argument……
My focus was on the fact that Aiŕbus does high rate producibility to a higher standard than Boeing. You can go back in history and see that it’s always been that way. The Meserschmitt 109 fuselage was a real eye opener if you look at it. The skins were stamped over dies into shape that joggled the fwd edge of the panel to slide it inside the aft edge of the panels ahead of it. You fasten left and tight together along the centerline and plug the sections together like Lego. It was self jigging and fast. This buys you a lot of goodness, less assembly skill needed, less assembly tooling needed, reduced variability. Much goodness, not to mention you could stand up a new final assembly hall quickly after you got bombed. These lessons were never forgotten, its in their nature to build things this way.
If we continue the dive into assembly methodology differences we look at how Airbus exploits the SECOND MOVER ADVANTAGE. The second mover may have been beaten to market and miss some of the advantages of that, BUT they are in position to deconstruct the original and refine it. Producibility matters a lot, and if you as the second mover execute improvements to the build process, there’s a lot more available profit margin in your airplane because the first mover locked in a set of production costs that are very difficult to improve. Airbus got beat to market by the 787. Airbus looked at the 787 and designed their airplane with a different (and I maintain superior) assembly methodology. The result is that they ended up with a great bird, the A350, that has lower complexity more easily built structure. Being second isn’t a terribly bad thing if you squeeze out a larger margin than the first mover did.
This subject, production optimization, second mover advantages and the true cost of non-optimised assembly processes is not getting the press it requires in America. All you need to do is to look at Germany France and to a far greater extent Japan for the results of second mover process implementation.
Japan’s industrial capacity was so completely disrupted by Curtis LeMay and the Fifteenth Airforces bombing that post war rebuilding of the industrial sector in many cases swept away the rubble down to bare dirt. The devastation was so complete that Japan was transformed into a giant greenfield site. This allowed then to avoid rebuilding sub optimal things that were too big to change en mass pressure war. They sort of got a do over and did a great job with the opportunity. Germany and France did the same to a lesser degree. I MUST also say that Firebombing Japanese city’s was a war crime and unacceptable in my value system.
There are other stories of second mover dominance in different industry sectors. Cameras were a European specialty until the Japanese took it away. Precision measuring devices were an American specialty with Starrett and Pratt and Whitney being replaced by Mitsotoyo. This is powerful stuff unrecognized by most here. It would be cool to rub elbows over beer and pizza and talk about this industry.
PNWgeek
There is no link between formal education and the unions here.
Same for worker safety, health insurance, “rente”. marginally “Mitbestimmung” has a union vector.
could you read a bit around and then we’ll talk again?
Uwe.
Perhaps I’m not clear in my writing…. My understanding is that inside the union, or guild, I’m not sure how they are addressed there that continued membership required continuing education, and that was a progression inside the union itself. There isn’t a direct connection to a university style of education but more of an actual apprenticeship documented and regulated by the union itself…. A favor If I may…. could you provide me a link that could point me more directly if pavailable… thannks
Start here:
https://en.wikipedia.org/wiki/Dual_education_system
Unions are worker representation vs the employer and in a limited scope. the state provides the framework.
historically you have to go back to Bismarcks Sozialgesetze
to understand the concept and evolution.
https://de.wikipedia.org/wiki/Sozialgesetzgebung (sorry, no EN version )
Uwe wrote
Tolerances and interfaces are the central levers in production.
GREAT COMMENT absolutely true. Tolerance necessity is also a function of the process being controlled. Standard dwg sheet tolerances in sheet metal structures assy at Boeing is +/- .030. The pierce and blank/brake form, drill and fastener process is just a bit too variable to build the parts closer than that. That leaves us with the reality that the sheet metal airplanes 737,767 and 777 all have a large group of shims needed to join them up. The fuselage segments are butted up to each other and the stringers, which leave oit the last 8 skin fasteners, are gently bent to line up the stringer splices. You shim the gaps as you drill up the parts. The stringers fasteners to the skins after you align them using the stringer splice to move them. You drillnthru the stringer sidewalks and stinger splice sidewalks, drill the caps, shim them all and fasten them up. This proces happens at every 737 stringer location at each. Tha 737 is literally buckets of shims flying in close formation AND it is an artifact of the part fabrication process. This ia 60s technology. Boeing has embedded way too much of this to change now. So say the bean counters. Us 767 guys saw the gains from changing all that crap out and using machined terminal fittings. It’s getting done here and there, but theere is so much legacy structure that it’s difficult to sell it.
Thanks for this comment.
I’ve been through the XFW A320 FAL and fuselage segment build areas.
no shims around 🙂
What you find is Airbus seems to use “liquid shim” that fills final hair thickness gaps.
apropos:
if you want to follow the processes there is set of video’s around produced by “Sendung mit der Maus” that follows an LH A321 through its production process. rather detailed.
https://www.ardmediathek.de/video/die-maus/flugzeugbau-teil-1/wdr/Y3JpZDovL3dkci5kZS9CZWl0cmFnLTk3NWY3ZGQ4LTBkNWMtNDI5Ni04MTUzLTU3ZmRjNDlmN2Y4MA?isChildContent=
UWE
Thanks
UWE
Enjoy
https://www.youtube.com/watch?v=lqWoe42I8Fw
https://www.youtube.com/watch?v=Vv5gBocOVSs
https://www.youtube.com/watch?v=8JDbxL3eV8U
https://www.youtube.com/watch?v=-PR6nnLd9W0&list=PLS2pKSeamqtHZL28MbkXQpZC72GIsfeGU
https://www.youtube.com/watch?v=jiH3-rJ-iYc&list=PLS2pKSeamqtHZL28MbkXQpZC72GIsfeGU&index=7
PNW thanks for your evaluation. I’ve seen the same HR issues with 2nd and 3rd Tier aerospace suppliers on the west coast. During COVID many senior (were) retired or moved to other sectors where their skills were appreciated and more stability is offered.
The workforce staying often becomes overloaded, making them move also, and not having time to train the new colleagues.
Many suppliers are under immense pressure from OEM’s to deliver, reps all over the place, causing organisational stress and everything that comes with that..
Various commenters ask if the 777X program’s financial pain can get any worse…and the answer is yes.
If cancellations start to occur due to non-observance of the agreed delivery term, then the deposits paid by the customer have to be returned.
In the case of the 777X, the initial 10% deposit will amount to about $20M (after allowing for usual discounts to list price). Consequently, if, for example, Tim Clark gets tired of being played and decides to cancel his 205-plane orders, then BA will be sending him a check for $4.1B.
This isn’t a charge — since a deposit is a loan rather than revenue — but repayment will put a nasty hole in cashflow.
Clark now has 12 A350s in service, and he’s getting lots of data on fuel economy, customer satisfaction, maintenance costs, etc. He can also ask Etihad and Qatar how the engines on their A350-1000s are performing in the Gulf climate. This is not a re-assuring situation for BA.
Even worse is if the 500 accounting block gets clipped. All of those deferred production costs are written off pro-rata below any shortage to the block. Boeing would have a hard time justifying that block if this program were launching today.
Ironically, the healthiest thing Boeing could do today is simply write off those charges today and let the program stand on its own going forward without the baggage of this development dumpster fire.
“Etihad Airways to receive first 777X jet in 2031, with airline unaffected by programme delays”
“The airline is to receive deliveries of 10 of the Airbus A321 long-range narrow-bodies it was scheduled to get this year. “We told the world that we would get 10 A321 LRs this year and we’re getting them – today actually we just got one more,” Mr Neves added.”
“The challenge is that some aircraft have not yet been certified and “it’s a big problem, but we don’t face that problem”, Mr Neves said, without identifying specific models.”
https://www.thenationalnews.com/business/aviation/2025/10/30/etihad-airways-to-receive-first-777x-jet-in-2031-with-airline-unaffected-by-programme-delays/
***
2031?
Just another 6 years…
With the 777-X already six years late, what’s another six?
no worries…Etihad Airways have 10 A350F and 11 A350-1000 (9 already delivered) on order!
I think an A350 midlife upgrade can be expected ~15 years into the program.
With technology evolving, market requirements changing overtime, new engine technology maturing, an A350 stretch (~45 seats) and reengining (RR Ultrafan) seem likely. EIS 2033?
https://onemileatatime.com/news/airbus-a350-stretch-version/