Boeing takes near $5bn hit due to delays in delivering first 777X jets

"Boeing pushed the first delivery of its long-delayed 777X jet program out to 2027 and took a nearly $5bn charge due to the delays, in another series of setbacks for the aerospace giant. The 777X was central to Boeing's long-term widebody strategy, previously dominated by its 747 and 777 jets. But repeated certification and production delays have pushed back deliveries by years, piling up charges of more than $15bn and straining its finances, while giving an opening to rival Airbus's competing A350"

"Including charges disclosed on Wednesday, Boeing has taken about $15bn in charges related to the 777X program. The latest charge includes penalties owed to customers for late deliveries. Shares of the planemaker were down 1% in premarket trading. Wall Street analysts had anticipated a sizeable charge to the 777X program. Richard Aboulafia, managing director of AeroDynamic Advisory, a US boutique aerospace management consulting firm, said the charge was more than the $2bn to $4bn he expected."

"While he does not expect the charge to be financially crippling to debt-laden Boeing, it does raise questions about any more surprises to come. However, the latest delay comes at a time when demand is growing for international travel driving demand for the widebody aircraft, which was not the case when the 777X was first held up. Now it might be getting to a challenge, Aboulafia said. People start to lose patience and demand compensation."

Boeing pushed the first 777X delivery to 2027 and recorded a nearly $5bn charge tied to program delays. Including earlier adjustments, Boeing has taken about $15bn in charges related to the 777X program, covering longer production costs and penalties owed to customers for late deliveries. Shares fell about 1% in premarket trading as analysts expected a sizeable charge. Consultant Richard Aboulafia said the charge exceeded his $2bn–$4bn expectation and, while not likely crippling, raises concerns about further surprises. The delays give Airbus’s A350 an opening amid rising international travel demand. Boeing previously grappled with 737 MAX quality and production problems.

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