German flag carrier Lufthansa announced a fresh order Monday for Boeing’s big new 777X widebody airplane, delivering a much-needed boost just as a leading industry figure questioned the jet’s future.
And the airline added an uplift too for the troubled 787 Dreamliner jet program, which hasn’t delivered a plane in the past year.
Adding to its previous 777X launch order in 2013 for 20 of the passenger version of the giant new plane, Lufthansa on Monday ordered seven 777X freighter models for its air cargo unit.
The freighter model, the 777-8F, was launched in January amid sharply higher demand for air cargo capacity that’s expected to continue for years.
Lufthansa also ordered seven 787-9 Dreamliners. And it added orders for two current model 777 freighters, to provide “extra cargo capacity in the near-term until the delivery of its first 777-8 Freighter.”
The orders are worth a total of more than $2.5 billion after standard discounts, according to market pricing data from aircraft valuation firm Avitas.
Less than two weeks ago, Boeing announced another major delay to the 777X, kicking out its entry into service until 2025.
And it wrote off another $1.2 billion for the jet program to cover the abnormal production costs the delay will incur. That’s on top of the $6.5 billion written off on the program in 2020.
That’s a massive $7.7 billion in costs that Boeing believes it cannot recoup from 777X deliveries.
Earlier on Monday, at the Airline Economics conference in Dublin, Ireland, aviation market maker Steve Udvar-Hazy, executive chairman of Air Lease Corp., said the 777X’s future could be at risk, according to a report of his remarks by Reuters.
Udvar-Hazy couched his doubts about the 777X in the context of a what he implied is a likely change in leadership at Boeing, including on the company’s board, given the current troubles at the U.S. planemaker.
“Whether to continue with the program or not, it will probably not be made by this board of directors anyway,” Reuters quoted Udvar-Hazy as saying.
Udvar-Hazy similarly expressed frustration over the paralysis affecting the Boeing 787 Dreamliner, deliveries of which have been largely halted since the fall of 2020 and completely stopped since May a year ago.
There is for sure an element of self-interest in Udvar-Hazy’s verdict. He has 787s on order and wants deliveries to resume.
And while he has no 777Xs on order, he does have orders for the rival Airbus A350-1000, which would benefit greatly if the Boeing 777X were to collapse.
Still, Udvar-Hazy has outsized influence in the aviation world and his criticism of Boeing can be damaging.
And his remarks about Boeing’s leaders echoed comments by another top airplane leasing executive, Avolon Chief Executive Domhnal Slattery, at a separate conference hosted by Airfinance Journal in Dublin last week.
Slattery said then that Boeing needs “fresh vision, maybe fresh leadership.”
The question marks over the company’s management linger. Still, Lufthansa’s order news could not have been more timely for Boeing.