Boeing jet deliveries sink to just four in May

By Eric M. Johnson and Rachit Vats

(Reuters) - Boeing Co (NYSE: BA) deliveries slowed even further in May from April as the coronavirus pandemic's crushing impact on airlines added to a year of crisis following the grounding of its 737 MAX planes, company data showed on Tuesday.

The U.S. planemaker said it handed over just four planes in May, down from the six it delivered in April, its lowest total for the month in six decades and about 87% fewer than it delivered to customers at the same time a year ago.

Deliveries are financially important to planemakers because airlines pay most of the purchase price when they actually receive the plane.

Customers also canceled orders for another 18 planes last month, including 14 MAX jets that were the company's top-selling plane until a pair of crashes just over a year ago.

While Boeing resumed production last week and expects to make deliveries of the MAX in the third quarter, many aircraft leasing companies and airlines, including Southwest Airlines (NYSE: LUV), United Airlines (NASDAQ: UAL), and Brazil's GOL have canceled or deferred delivery as the industry faces a collapse in air travel since January.

Earlier on Tuesday, Reuters reported Emirates, one of the world's biggest long-haul airlines, laid off hundreds of pilots and thousands of cabin crew.

Boeing shares fell more than 3% by the early afternoon.

Boeing did score nine new orders for wide body planes and its deliveries included two 777 freighters, one 737 NG (Next Generation)-based aircraft for the U.S. military and one 767 freighter, but no passenger planes.

The May cancellations came from a host of aircraft-leasing firms, including three from Aviation Capital Group, one from CIT Aviation, four from General Electric Co's (NYSE: GE) leasing division and six unidentified customers.

Leasing firms, which control over 40% of the global fleet, are among the largest MAX customers.

After further accounting adjustments representing jets ordered in previous years but now unlikely to be delivered, Boeing's adjusted net orders sank to a negative 602 airplanes.

(Reporting by Eric M. Johnson in Seattle and Rachit Vats in Bengaluru; editing by Patrick Graham and Dan Grebler)

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