United Airlines cuts 2024 plane delivery plan as Boeing crisis leads to delays

United Airlines on Tuesday it lowered its expectations for aircraft deliveries this yr as it grapples with delays Boeingthe newest airline to face growth challenges due to the planemaker’s safety crisis.

United expects to receive just 61 recent single-aisle planes this yr, down from the 101 it expected firstly of the yr and contracts for as many as 183 planes in 2024.

“We have adjusted our fleet plan to better reflect the reality of what manufacturers are able to deliver,” CEO Scott Kirby said within the earnings release. “We will use these aircraft to pursue an opportunity that only United has: to profitably grow our midcontinent hubs and expand our highly profitable international network from our industry-leading coastal hubs.”

United said it plans to lease 35 Airbus A321neo planes in 2026 and 2027, turning to rival Boeing for brand spanking new planes as the U.S. manufacturer faces production cuts and increased federal scrutiny. In January, United said it was withdrawing Boeing’s as-yet unapproved Max 10 from its fleet plan. The airline said it had converted several Max 10 aircraft to Max 9s.

It lowered its annual capital spending estimate to $6.5 billion from about $9 billion.

United also faces a Federal Aviation Administration safety review that has blocked a few of its planned expansion. A spokeswoman told CNBC earlier this month that the carrier would have to postpone a planned service from Newark, New Jersey, to Faro, Portugal, and a service between Tokyo and Cebu, the Philippines.

United earlier this month postponed its investor day scheduled for May “as our entire team is focused on working with the FAA to review our safety protocols, and focusing on an exciting investor day would simply send the wrong message to our team primarily on financial results.” “

The airline said it would have reported a profit in the quarter had it not been for $200 million in losses resulting from the temporary grounding of the Boeing 737 Max 9 in January.

The FAA temporarily grounded these jets after a door plug blew Alaska Airlines flight, creating a new safety crisis for Boeing and slowing deliveries of its planes to customers including United, SW and others.

The airline reported a first-quarter net loss of $124 million, or 38 cents per share, compared with a loss of $194 million, or 59 cents, a year earlier. Revenue rose nearly 10% in the first quarter from the prior-year period to $12.54 billion, with productivity increasing more than 9% from a year earlier.

Here’s United’s first-quarter report compared to Wall Street expectations, based on average estimates compiled by LSEG:

• Loss per share: Adjusted 15 cents against an expected loss of 57 cents
• Income: $12.54 billion dollars against the expected USD 12.45 billion

The airline expects to earn between $3.75 and $4.25 in the second quarter, compared to analyst estimates of about $3.76 per share. Airlines make most of their profits in the second and third quarters, during the peak travel season.

The carrier also maintained its full-year earnings forecast of $9-11 per share.

United shares rose more than 4% in after-hours trading on Tuesday.

United management will hold a call with analysts on Wednesday at 10:30 a.m. EST.