In a big change from the typical trend of the past few years, Boeing (BA +4.11%) captured more aircraft orders than Airbus (EADSY 0.26%) in the first half of 2021. That continued in June, as Boeing won the bulk of a 270-jet order from United Airlines.
However, Boeing's 2021 order activity has barely made a dent in Airbus' backlog advantage. Moreover, Airbus is delivering jets at a dramatically higher rate than Boeing. That's driving a quick revenue and cash flow recovery for the European aerospace giant, while its U.S. counterpart continues to suffer.
Deliveries accelerate
Earlier this month, Airbus reported that it delivered 77 commercial jets in June. That marked its best month of the year, topping the 72 jets it delivered in March.
Additionally, while the best-selling A320 family always accounts for the bulk of Airbus' deliveries, the company benefited from a healthier mix last month. Airbus delivered 15 wide-body jets in June -- 11 A350s, two A330neos, one A330-200, and one A380 -- along with five A220s and 57 A320-family jets. By contrast, its 50 deliveries in May included just five wide-bodies.
Image source: Airbus.
For the second quarter as a whole, Airbus delivered 172 commercial jets, up from 125 in the first quarter. That brings its year-to-date total to 297, consisting of 21 A220s, 237 A320-family aircraft, one A330-200, six A330neos, 30 A350s, and two A380s.
A different story at Boeing
Airbus' June deliveries thrashed Boeing's performance yet again. Boeing delivered 45 jets last month: 35 737s, four 767s, five 777s, and one 787. Weak demand for the 737 MAX and newly discovered defects impacting the roughly 100 undelivered 787s in Boeing's inventory contributed to the sizable gap in the two aircraft manufacturers' deliveries.
Sadly, June was a good month by Boeing's recent standards. The company handed over just 34 commercial jets in April and May combined, mainly due to a long pause in 737 MAX deliveries. And despite the recertification of the 737 MAX in most markets -- with the notable exception of China -- Boeing delivered only 156 jets in the first half of 2021: barely more than half of Airbus' total.
Year-to-date order activity doesn't change things
Boeing does lead Airbus on one metric this year: new jet orders. The U.S. aerospace giant booked 599 gross orders in the first half of 2021, including 505 737 MAX orders. Airbus recorded 165 gross orders during that period, including 137 A320neo-family orders.
Image source: Boeing.
On a net basis, Boeing has a smaller (but still significant) advantage. After factoring in cancellations and adjustments to its estimates of orders that are unlikely to completed, Boeing recorded 267 net orders in the first half of the year. Airbus' year-to-date net order total stands at 38 units, having finally reached positive territory for the year thanks to United's late-June order for 70 A321neos.
However, Boeing's 2021 order advantage has barely made a dent in its long-running backlog deficit compared to its top rival. Airbus ended June with 6,925 unfilled orders, far ahead of Boeing's 4,166-unit backlog.
Airbus remains a better bet for investors
In the first quarter, Airbus generated positive free cash flow of 1.2 billion euros ($1.4 billion). Meanwhile, Boeing burned another $3.7 billion.
Given that its commercial jet deliveries increased significantly last quarter compared to Q1, Airbus could post even stronger free cash flow when it reports its earnings. By contrast, Boeing's slow pace of deliveries dooms it to another quarter of high cash burn.
Despite Airbus' consistently stronger performance and huge backlog advantage, its enterprise value currently stands at around $100 billion, compared to $175 billion for Boeing. While Boeing has a much bigger defense and space business than Airbus, it doesn't justify this huge premium. For investors looking to bet on the global aviation industry's recovery, Airbus is clearly a better choice than its U.S. counterpart.
