Boeing Orders Lagged Behind Airbus in 2011
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Boeing Co. secured a second-place finish in the annual competition for jetliner orders and deliveries behind European rival Airbus, but officials at both companies see a tighter race this year.
In 2011, Boeing delivered 477 commercial airliners. It landed new orders for 805 planes, after cancellations, and before cancellations booked a gross order intake of 921 planes.
Airbus, a unit of European Aeronautics Defence & Space Co., said it had delivered 477 planes through Nov. 30. According to a person familiar with the figures, Airbus delivered more than 530 planes through Dec. 31. Through November, Airbus booked 1,378 net orders and 1,521 orders before cancellations. Airbus will reveal its full-year orders and deliveries on Jan. 17 and is likely to set a new industry record for planes ordered in a single year.
Airbus's orders were boosted significantly by a new-engine version of its best-selling A320 single-aisle family of planes, dubbed the Neo. Through November, Airbus had won 1,196 firm Neo ordersâaccounting for 87% of its 2011 net orders to that pointâand 254 more commitments.
Chicago-based Boeing responded to the Neo in July by announcing plans to update its top-selling 737 model as the 737 Max. Boeing announced its first firm order for the Maxâa contract for 150 from Southwest Airlines Co.âlast month and said it has commitments from customers to buy several hundred more. Boeing executives have predicted their tally of orders and commitments for the Max could reach 1,500 by the end of this year. Boeing Thursday said it has more than 1,000 orders and commitments to date from 15 customers for the plane. Firm orders are signed contracts secured by a down payment.
"We have a lot of work to do to make sure we take those commitments and turn them into firm orders," Randy Tinseth, vice president of marketing for Boeing's commercial-airliner division, said in an interview Thursday.
United Continental Holdings Inc. is likely to be one of Boeing's big wins for the new 737, according to people familiar with the situation. The world's largest airline has been talking for several months to both Airbus and Boeing about a new order for single-aisle planes to replace some of its 152 Airbus aircraft and 157 aging Boeing 757s.
United is leaning toward Boeing planes, although the competition remains open, said the people familiar with the situation. Formed by the 2010 merger of United Airlines and Continental Airlines, United is now managed largely by veterans of Continental, which ran an all-Boeing fleet. The combined airline expects this year to receive around 20 current-version 737s and has firm orders for 30 more. Airbus is less familiar to Continental veterans.
"With the Max and today's [737 model], we like our chances" in the United competition, said Boeing's Mr. Tinseth, while refraining from discussing details of the talks.
The timing of a United deal is being determined partly by when Boeing presents more details of the Max, said one person close to the matter. John Hamilton, Boeing's chief engineer for the 737 program, said last month that the Max "still is being defined" and the work should finish around midyear.
Airbus officials have said they expect a much slower order intake this year, in part because their factories are now booked out for many years to come.
"I think we'll be back more to the duopoly again" this year, Airbus Chief Operating Officer and top airplane salesman John Leahy said recently.
Airplane-delivery numbers are likely also to be closer this year, officials at both companies say. In 2011, Airbus produced more jetliners than Boeing for the ninth consecutive year. Although the European company is continuing a steady increase in output, Boeing aims to make a big jump by sharply increasing deliveries of 787 Dreamliners, a model that has been plagued by design and production problems.
Boeing delivered just three of the new jets last year, falling short of executives' most recent target, projected in October, of roughly five to seven Dreamliner deliveries for 2011. Those delayed deliveries should spill into this year.
Dreamliner deliveries also are expected to rise as Boeing makes modifications to roughly 40 almost-finished jets that couldn't be completed until designs were finalized last year. Boeing officials said last summer that reworking all those planes will take about two years.