Most companies saw sales weakness in January, and The Boeing Company (NYSE: BA) was no exception. As the global economic slowdown continues to drag out, the company saw sharp drops in order for both freight and passenger jets in the month.The figures are pretty staggering. In January, the company only received order for 18 jetliners. When you compare this with January of last year, when the company had orders for 65 of its planes, you see a year over year decline of 72%.
It is really not surprising that orders are down, but for Boeing, which saw sales tumble through 2008, its a tough way to start the year.
Air travel has been slowing for some time now, and in reaction, most major airline companies have been reducing their number of flights, and consequently are not in need of newer planes at this time. I wish I could say that things should turn around soon for the industry, but it does not appear as though that will be the case.
The company's chief executive, Jim McNerney, stated last week that the global economy continues to weaken and is adversely affecting air traffic growth and financing." This statement came in conjunction with the news last week that Boeing had a surprise fourth quarter loss, and was planning to cut around 10,000 jobs.
With all the bad news, the stock is actually trading higher today, moving up 1.8% to $42.73. Is it possible that the market has already priced the company's slowdown in orders into the price? Douglas McIntyre had a piece on the company earlier today, and while he offers reasons why the future could be bleak for the company, he also points out the company could start to look like a buy if it is able to avoid losing any more of its customer orders for its 787 Dreamliner.
Reader Comments (Page 1 of 1)
2-05-2009 @ 10:57PM
Kent said...
Is the tanker bid still on-going? The Airforce should award the contract to Boeing under present circumstances. That industry is more vital to us than the automotive one if you had to choose between the two.
2-06-2009 @ 1:37PM
c. schmidt said...
The extent of this crisis is really astounding, that an entire world can be hurting at one time...http://www.sindhtoday.net/world/60563.htm this website covered the problems in Kazakhstan and how their building market has essentially stopped due to financial problems