WASHINGTON—Orders for aircraft, cars and spare parts fell sharply in March, and consumers’ souring view on the economy suggested the decline in demand related to the coronavirus pandemic could deepen in the coming months.
New orders for aircraft and parts fell by more than $16.3 billion in March from February, a 296% decline, the Commerce Department said Friday. Since orders are recorded on a net basis, the figure incorporates canceled orders. New orders for automobiles and parts fell 18.4% in March.
Overall orders for durable goods—products designed to last at least three years—were down 14.4% in March, the biggest monthly drop since August 2014.
Excluding the volatile transportation sector, orders were down a more modest 0.2%. New orders for nondefense capital goods excluding aircraft—a closely watched proxy for business investment—were up 0.1%.
The collapse in net aircraft orders in March reflected what Boeing Co. called its biggest monthly spike in jetliner cancellations in decades as airlines started to adjust their fleets in response to the pandemic.
Boeing secured deals for 31 jets last month compared with 43 in March 2019, but had cancellations for 150 of its 737 MAX planes, which have been grounded for more than a year awaiting regulatory approval to fly again after two fatal crashes.
The company removed deals for 307 planes from its order book in the first quarter, while aerospace suppliers also suffered a big drop in sales of spare parts to airlines in March as the collapse in air travel forced the grounding of two-thirds of the global jet fleet.
Analysts said the transportation sector appears to have been the first to bear the brunt of the economic shock related to the coronavirus. Other sectors will probably show similar sharp declines in the months ahead, said Gregory Daco, chief U.S. economist at Oxford Economics.
Friday’s report covers the month of March, when the lockdowns to contain the spread of the coronavirus were in their early stages.
“We’re going to see steep drops across different categories,” he said.
Separately, an index measuring Americans’ outlook for the economy posted the sharpest single-month decline, according to a University of Michigan survey released Friday.