The Boeing 777X promises to be a game-changing long-haul aircraft when it enters commercial service. Alas, airlines and passengers must wait three more years before that comes to pass.
Boeing now expects that the first aircraft will not be delivered to passenger airlines until late 2023, based on an “updated assessment of global certification requirements, the company’s latest assessment of COVID-19 impacts on market demand, and discussions with its customers.” Based on training and new aircraft familiarization this could result in the type not flying passengers until early 2024, depending on the actual delivery date.
A lag of 4 years between first flight and entry into service would not be unprecedented in the industry overall, but it is far from ideal. The 787 saw a two year lag between first flight and commercial operations, though it also went on to be grounded over safety issues. And then there are other programs such as SpaceJet, where the first flight occurred in November 2015. It remains far from certified and Mitsubishi grounded the fleet last year, both because of the pandemic and because the future of the aircraft is terribly uncertain.
The company also wrote off $6.5 billion in development costs for the 777X program last quarter, a move that effective writes off the cost of the program development. Boeing appears to simply be taking all the losses it can right now, recording its worst financial year ever.
On the plus side European and UK regulators approved the 737 MAX return to service on Wednesday, though both added training and flight deck requirements more strict than those of the FAA. China remains the lone holdout, with Boeing confident that will be resolved early this year.
For airlines the 777X delay is mostly good news. Long-haul demand is down and no one wants to spend the cash to launch a new fleet, despite the improved fuel efficiency. It also buys Boeing time to account for what is likely to be a more stringent certification process, but that’s where the up-side ends.
Several carriers have promised luxurious new offerings on board, such as the new Lufthansa Business class product, first tipped in 2017). Or the expanded premium economy offering on Emirates.
Those offerings, and others, will now have to wait.
This translates into a potential cash crunch for many involved in the global aviation ecosystem.
Expect that the suppliers involved in the program will feel the squeeze for the next few years. From seats and screens to rivets and electrical connectors and everything in between, this delivery delay will be brutal for the smaller businesses.
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