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Flood of New Jets Will Create Turbulence

Race to build smaller long-range planes could weigh on the aircraft-finance industry

After years of getting crowded with small planes and big planes, the skies are about to be invaded by medium-sized planes. The shift may delight airlines and flyers, but is starting to create problems for plane owners.

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Boeing Plans $5 Billion Charge to Compensate 737 MAX Customers

Plane maker says the funds will be paid to airlines over a number of years

Two crashes and the global grounding of Boeing’s 737 MAX commercial airliner led to extensive disruption in the international aerospace industry. WSJ’s Robert Wall explains the continuing effects of the plane’s grounding. Photo: Getty Images

Boeing Co. will set aside about $5 billion to compensate airlines that have suffered because of the prolonged grounding of the 737 MAX plane.

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Boeing Might Halt 737 MAX Production if Grounding Drags On

Aerospace giant posts biggest-ever quarterly loss after taking $7 billion hit on grounding of best-selling jet

Boeing Co. said it might slow or halt production of its 737 MAX jetliner if regulators don’t approve its return to service by the end of this year.

The warning came as the aerospace giant on Wednesday reported its biggest quarterly loss to date, after taking an initial $7 billion hit on the grounding and slowed production of the MAX.

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Buyers of Boeing’s Newest Jet Fear Delays

Airlines prepare to keep older jets in fleet in case new 777X is late

SEOUL—Airlines are increasingly anxious that Boeing Co.’s BA -1.24% 777X long-haul jet will be delivered late—another potential setback for the embattled plane maker.

Emirates Airline, the largest customer for the 777X, and Deutsche Lufthansa AG DLAKY 0.59% , the biggest customer in Europe, are drawing up contingency plans in case the plane doesn’t arrive on the promised schedules, airline representatives said.

Tim Clark, president of Emirates Airline—with orders for 150 of the planes and options to purchase 50 more—said the carrier may have to keep older model 777-300ERs in its fleet longer if the replacement aircraft isn’t ready. The first 777X test plane originally was due to fly in 2018. It has yet to take off.

Mr. Clark said the first flight is now planned for June 26. The delay could make it challenging for Boeing to meet the June 2020 delivery commitment of the first plane to Emirates Airline, he said.

A Lufthansa official said the German carrier is preparing to keep some of its older 747-400 jumbo jets that were due to be retired in its fleet longer if the 777X schedule slips. Using older, less fuel-efficient planes would add to the costs for carriers, which Boeing may have to cover under industry standard contract terms.

Excerpt from WSJ
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