United Airlines CEO Scott Kirby, arms raised, during the signing of the order with Boeing, on December 13, 2022 in North Charleston, South Carolina (AFP / Logan Cyrus)
United Airlines on Tuesday ordered 100 wide-body 787s from Boeing and put an option for 100 more aircraft, which represents the largest purchase of planes in this category ever made by an American company.
These long-haul aircraft, which have recently faced significant manufacturing issues, are due for delivery between 2024 and 2032. They are intended to gradually replace the company’s aging Boeing 767s, as well as some Boeing 777s, which will should enable a 25% reduction in carbon emissions per seat.
This order “marks a new step” in the positioning of United as a major international company, welcomed its boss, Scott Kirby, in a briefing with journalists.
In the midst of a pandemic, despite the drop in air traffic, the company had decided to move forward. Betting on a solid recovery in air transport, it had already placed a huge order for medium-haul aircraft in the summer of 2021, with 200 Boeing 737 MAX and 70 Airbus A321neo.
Also banking on a renewed demand for international flights once the health restrictions have been lifted, it has significantly extended its network outside the United States, adding 13 destinations and 40 new lines in two years.
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On Tuesday, in addition to the widebody aircraft, the company also announced that it will exercise an option on 44 737 MAX aircraft for delivery between 2024 and 2026 and that it has ordered 56 more for delivery between 2027 and 2028.
The company plans to finance its new purchases with its cash or possibly with loans if the financial conditions are attractive.
For Boeing, this contract represents a new breath of fresh air following several years marked by the 737 MAX crisis following two fatal accidents and the pandemic.
The manufacturer had indicated in November that it wanted to return to better health, both operationally and financially, by 2025 or 2026.
Stan Deal, the head of Boeing’s commercial division, in North Charleston, South Carolina, on December 13, 2022 (AFP / Logan Cyrus)
United’s 787 order will already support some 120,000 jobs at Boeing and its contractors, the manufacturer’s commercial division manager, Stan Deal, said at the factory where they are built in Charleston. in South Carolina.
This makes it possible to “secure” production, with production rates expected to increase from less than 5 devices per month currently to 10 by 2025, he said, stressing that the pace might accelerate further if necessary.
With the 787 and 777, Boeing historically dominates this higher-margin market segment, with Airbus rivaling its A350 and A330.
The collapse of long-haul air traffic during the pandemic, however, had plunged the wide-body aircraft market, which was already struggling a little before the spread of Covid-19. But demand is starting to pick up slightly.
Aerospace giants expect demand for new long-haul planes to soar, with Airbus estimating it at 7,870 aircraft over the next 20 years, Boeing at 7,230.
A Boeing 787 production line at the North Charleston plant on December 13, 2022 in South Carolina (AFP/Logan Cyrus)
The 787 was however still in difficulty recently. Manufacturing defects were discovered at the end of summer 2020. The device being examined closely, other problems then appeared.
Boeing had to suspend deliveries, from November 2020 to March 2021 initially, then between May 2021 and August 2022. And reduce production rates.
“Despite these small original problems, the device is beginning to have a certain maturity, and it is appreciated by crews and passengers,” said Michel Merluzeau, of the specialist firm AIR.
For Scott Kirby, the agreement with Boeing represents a sign of confidence in the manufacturer following a difficult period. “Boeing has worked long and diligently with the FAA (the American agency supervising aviation, editor’s note) to emerge stronger” from this crisis, he said.
The action of Boeing took 0.5% at the end of the session on Wall Street on Tuesday while that of United fell 7%.
