Employees working on the engine of a Boeing 737 MAX airplane at a company factory in Renton, Wash., on April 29.
Photo: Stephen Brashear/Getty ImagesBoeing Co. said jetliner cancellations exceeded new orders in May, though the company found a bright spot with fresh deals for its cargo planes.
Plane-rental companies dropped deals for 14 more 737 MAX jets, and Boeing also lost orders for four wide-body aircraft. The cancellations were less than in April and came in a month when rival Airbus SE won no new jetliner business.
Boeing shares were down about 4% midday Tuesday following the company’s monthly update on its backlog. The share price had almost doubled over the past three weeks as airlines announced plans to add flights for the summer.
Corp. and United Parcel Service Inc. added to their existing Boeing orders, as cargo jets provided a rare competitive advantage for the aerospace giant, still hobbled by weak demand for big passenger planes and the continuing grounding of the 737 MAX.
Boeing, which makes three different types of cargo jets and converts passenger planes to carry cargo, has a broader lineup than Airbus. The European plane maker is now expanding its offerings to tap demand from established express carriers and new entrants such as Amazon Air.
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More than 14,000 planes are still parked world-wide because of the slump in travel and commerce as the coronavirus spread. Passenger jets normally help meet cargo demand by carrying high-value items like consumer electronics, apparel and fresh fruit, and the slump has removed half the air-cargo capacity for such goods.
The shortage of cargo space has almost doubled freight costs on busy trade routes, such as between China and the U.S., according to data provider WorldACD. Airlines have responded by returning cargo jets from desert storage and by reconfiguring passenger planes to carry freight in the main cabin.
Dubai’s Emirates Airline has modified almost 100 of its Boeing 777s to carry just freight, and U.S. carriers including United Airlines Holdings Inc. have pressed dozens of passenger planes into service to carry medical equipment and general cargo.
Boeing said FedEx ordered an additional Boeing 767 and UPS added another 747 jumbo in May. Unidentified airlines ordered five more 767s and two 777s, all freighters.
However, the plane maker also lost deals for four wide-body jets, three of them destined for Volga-Dnepr Airlines. Boeing is embroiled in a contract dispute with the Russian airline but said it has lined up alternative customers, according to court filings.
The 14 canceled MAX jets in May compared with the 108 removed from Boeing’s order book in April. The company also downgraded the status of deals for another 77 planes because of contractual changes and airlines’ weakening financial health amid the pandemic.
Boeing has shed more than 600 orders so far this year, marking the biggest jump in cancellations in decades. It delivered two 777 passenger jets last month as well as one 767 freighter and a military version of the 737.
Airbus last week said it didn’t secure any new deals for jets in May though had no cancellations and delivered 24 planes.
Airbus and Boeing are both cutting production and are expected by analysts to suffer more cancellations as airlines shrink. The coronavirus pandemic may cost at least two or three years of industry growth, according to the plane makers and airline executives.
The International Air Transport Association said Tuesday that the global airline industry is forecast to lose around $110 billion in 2020 and 2021, ending an 11-year run of profitability. The trade group estimates global passenger traffic will drop around 55% this year and remain depressed in 2021.
Write to Doug Cameron at doug.cameron@wsj.com
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