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?

Comments

  1. Is there a good reference for why an airline would buy one type of plane vs. another? Choices like 737 vs. 777 are obvious, but what is the advantage of an older design like the A330-900NEO?

  2. I have to say, from a passenger standpoint, I absolutely prefer the A359 over the B788. It feels wider and it’s so much quieter than the B788.

  3. How are they ever going to be a premiere airline if their business plan involves buying other people’s crap? I guess this proves that this is not their goal.

  4. As much as I wanted to see the 787 in Delta livery, the A350 will be nice. Actually, as long as it’s a new aircraft and it replaces their ancient, dirty 767s, I don’t care what it is!

  5. In addition, I recall reading an article that Delta wanted these new planes for its longhaul routes as soon as possible so they can retire their 747s. Between the A350 and 787, Delta can get the A350s delivered sooner than the 787s.

  6. @Joe–sometimes “old designs” refreshed are better. There is a reason the 737 has had its “old design” refreshed over and over and continues to be a top selling aircraft.

  7. Perhaps they are pushing Boeing for the long wished for 757 replacement, I could see them being a launch customer… A new 757 would surely have a similar capacity as the 787-8 but cheaper to operate on the many medium distance routes Delta operates.

  8. 16.8″ seats in Y means the 787 family will never be popular with customers. McDonnell Boeing miscalculated on the cabin width and it’s going to haunt the program for its entire life. Of course the airlines aren’t going to embrace a 19″ Y seat when the airframe manufacturer has left (surprise surprise!) JUST enough room for the seat manufacturers to shoehorn in 9-across. So you see, it isn’t REALLY the “airline’s choice” when the choice is basically made for them (and why they select the aircraft).

    A359 is also 9-across, never played any silly games about pretending to configure as 8-across in the glossy mockup cabins – just made the cabin wide enough for 18″ seats and an actually tolerable long haul coach experience. I live in Seattle, but I’ll fly the 359 all day over the 788.

  9. The A30) is definitely a more comfortable plane It is my own preference though. To me, this article is a piece of good news! Thanks for sharing!

  10. With 800 aircraft in Delta’s fleet it’s probably a smart move to not introduce the 787 considering the merged NW aircraft. Delta flies the 747, 777, 767, 757, 737, 717, MD90, MD88, A319, A320, A321, A330, and the CRJ, Embraer regional jets. And soon they’ll add the A350 and CS100.An exhausting list of varied aircraft even for a super carrier. That said, Delta is phasing out the 747, 757, 767, MD90, MD88. I think there’s a chance they’ll phase out the A319 when they get the CS100. My take is that Delta is trying to wind up with 737, A320, A321, A330, A350 and CS100 makeup along with smaller regional models. American, too, has a large fleet divided between Airbus and Boeing along with a mix of regional jet types. Eventually even for the big 3 U.S. carriers a wide mix of aircraft types will prove to be financially a bad gambit and which is already causing them to pare down aircraft makes and models.

  11. The worst part of this news is 120 737-900ER’s…The poor mans [bad] attempt at a 757 replacement…These are HANDS DOWN the most uncomfortable aircraft coming out on the market today…

  12. I think dotproduct put it very politely. B787 is a maintenance nightmare and B788 is the worst. Both in-house engineering pioneers LH and DL avoiding it like plague. At least B789 has better economics. BA has it because it discarded (or) discarding in-house mx model and outsourcing to cheapest vendor. AI burnt badly by taking near teens. QR managing by bullying Boeing.

    Good for DL.

  13. I wish they kept NW’s order for the A380’s, but I realize that model wouldn’t fit into DL’s structure. Who knows, maybe they’ll still pick up a SQ A380 on the cheap. lol

  14. WHAT ARE THEY THINKING?!?!?!?! They’re an american airline and are making their entire fleet french/german. A350 is not as good as 787 and the only reason that 350 would come first is because of them deferring the 787 repeatedly

  15. All interesting comments. Having recently flown KIX-LAX r/t three times on JAL I do concur the 787 is not a dream airliner … unless you are 5’6″ or shorter.

  16. Nobody really commented on the fact that Richard Anderson, former CEO/current chairman of delta, at least recently, LOVED being a prick to Boeing. (See his last year’s 777 valuation comments.) This couldn’t be a factor, right? LOL

  17. @MontanaOsprey. I am pretty sure it was a factor. Boeing was using exim bank to finance foreign airlines aircraft purchase from them at prefferable interest rates. Interest rates that they dont extend to Delta etc. Exim bank….i read somewhere, correct me if i am wrong …is taxpayers money, which in turn is being used to finance the arab carriers who dont care if they make or lose money, thereby threatening US carriers by flying with empty seats at a 60% rate plus cheap tix to boot.

  18. @Eric: They will be — Airbus now have a factory in Mobile, Alabama, where US-made A319, A320, A321 aircraft will be going to Delta, JetBlue, AA, and others. Keep in mind Boeing is moving some of its operations to China, with the full intent of building 737s in China, not Seattle.

    Delta has their own, very capable, MRO. The old aircraft are paid for, so other than insurance there’s no cost to have them other than maintenance/repairs. Until fuel prices start to skyrocket, it’s MUCH cheaper to run the old birds into the ground. It’s the same reason why many people drive older cars — it’s paid for, why take on new debt for no real gain/benefit? Keep in mind aircraft aren’t static like cars. Interiors can and are upgraded, flight systems are upgraded. Even engines sometimes see upgrades.

    Other than the lack of IFE, I don’t mind the Mad Dogs. Very quiet aircraft if you’re sitting up front and the last one I was on had a newer interior, even 100% LED lighting inside. Other than the funky 1980s intercom panel by the purser, the cabin never gave a clue that you were in a 20+ year old aircraft.

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