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No Surprise: Delta Cancels Their 787 Order

Delta has just announced that they’ve canceled their order of Boeing 787-8 aircraft. Delta had 18 of these on order, which were set to be delivered in 2020 and beyond. These were ordered by Northwest back in 2005, and Delta has repeatedly deferred the delivery of these, which is why the order being scrapped isn’t surprising.

delta-787

Here’s Delta’s press release regarding the order cancelation:

Delta Air Lines has reached an agreement with The Boeing Company to cancel an order placed for 18 Boeing 787 Dreamliner aircraft that Delta assumed in 2008 as part of its merger with Northwest Airlines.

While specific terms of the agreement are not disclosed, Delta will continue to take delivery of new 737-900ER aircraft through 2019 as two orders totaling 120 of the narrowbody jet are fulfilled.

“Delta is one of the world’s largest operators of Boeing aircraft and our valued partnership with Boeing will remain strong as we safely and comfortably serve our customers across the world every day,” said Greg May, Senior Vice President – Supply Chain Management and Fleet. “This business decision is consistent with Delta’s fleet strategy to prudently address our widebody aircraft needs.”

In 2010, Delta deferred the order to a 2020 and beyond delivery timeline.

So, what’s Delta’s motivation for canceling their 787 order? I suspect there are a few factors at play:

  • Delta already has 25 A350-900 and 25 A330-900NEO aircraft on order, which is a significant expansion of their international fleet
  • In addition to that, Delta has repeatedly stated their interest in picking up used planes at huge discounts; given how many airlines retire planes after just 10 years, there’s a lot of merit to picking up used planes rather than buying new ones
  • While both planes have low operating costs on a per passenger basis, the A350-900 has a significantly greater capacity than the 787-8

Bottom line

Delta canceling their 787 order is news, though hardly comes as a surprise, given that they’ve deferred delivery of these planes, and have 50 Airbus widebody aircraft on order. I can’t say I mind too much, since I prefer the A350 to the 787 from a passenger standpoint.

I’m curious how much the order cancelation cost Delta. Given that these were long term deliveries and the two companies have worked together for so long, I suspect the cancelation cost wasn’t too punitive.

Are you surprised to see Delta cancel their 787 order?

http://onemileatatime.boardingarea.com/2016/12/27/delta-cancels-787-order/One Mile at a Time

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