Boeing Crisis Continues As Airbus Steals Thunder In Air Show
Zacks Investment Research | Jun 20, 2019 10:20PM ET
The Boeing Company (NYSE:BA) did not have an impressive start to its campaign at the ongoing International Air Show in Paris. Much of this was expected as the company has been battling a huge crisis for the past few months, thanks to the twin crashes involving its 737 aircraft.
How Airbus Toppled Boeing at the Air Show
Boeing had a disappointing start to the air show as it failed to acquire fresh orders on the very first day. This came as a major blow to the company as its arch-rival — Airbus SE (OTC:EADSY) — took advantage of Boeing’s ailing condition. Airbus announced the launch of its A321XLR single-aisle airliner, backing up with 27 initial orders for the plane from Air Lease Corporation, which will replace Boeing’s aging fleet of 757 jets.
Things, however, started looking up for Boeing over the course of the event. After being on a turbulent ride for the past three months, the company finally sold 20 787-9 and 787-10 Dreamliner jets to Korean Air, marking its first sale since mid-March. Also, ASL Aviation Holdings DAC jointly announced an agreement with Boeing for the acquisition of 20 737-800 Boeing Converted Freighters, which includes 10 confirmed orders.
Nonetheless, these orders were insufficient to edge past Airbus SE that successfully acquired 320 orders compared to Boeing’s 270, per a report by Vertical Research Partners. Furthermore, Boeing lagged in acquiring significant firm orders at the show, as most of the prospective ones came in the form of commitments. Additionally, Boeing trailed Airbus in the emerging long-range, midsize jet market.
A Ray of Hope for Boeing
Nevertheless, amid successful launch of Airbus’ A321XLR single-aisle airliner, Boeing still found a reason to cheer in the Paris Air show. The relief came from the International Airlines Group (LON:ICAG) that announced its intention of purchasing 200 Boeing 737 MAX Airplanes, which would be valued at more than $24 billion, per list prices. Encouragingly, such developments will provide the company with the boost to resolve the prevailing problems with its 737 aircraft.
Price Performance Comparison
Shares of Boeing have gained only 16.2% year to date compared with the Zacks Investment Research
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