Boeing Confident On Rate Increase
March 08 2017 - 12:59PM
Dow Jones News
By Doug Cameron
Boeing Co. said Wednesday that it is ready for the next
production increases in its 737 jetliners as the aerospace company
prepares to deliver the first of the revamped Max models in the
summer.
The company is stress-testing its production system monthly as
it readies to boost monthly output to 47 from 42 this year, said
Keith Leverkuhn, vice president and general manager of the 737 Max
program.
Investors and analysts remain focused on potential supply-chain
kinks as Boeing and Airbus SE boost output.
Boeing is transitioning to producing the Max version of the
50-year old 737 platform and phasing out the existing models while
boosting its output rate to record levels. It has sold more than
3,600 of the Max jets.
"We are very comfortable with the ability of our shops to
accommodate the higher rates," Mr. Leverkuhn told reporters. He
said the focus of its stress-testing is with external suppliers,
many of whom also provide parts to Airbus.
Boeing has said around 15% of the 737 jets it delivers this year
will be the Max model, which includes new engines and other
upgrades to improve fuel efficiency and reduce maintenance costs.
Mr. Leverkuhn declined to detail exactly how many this would
involve, but the first delivery is expected in the second
quarter.
Southwest Airlines Co. is the launch customer and expects to
receive its first Max jets in October, but Norwegian Air Shuttle AS
has said it expects to secure its initial planes in May.
Mr. Leverkuhn also defended plans to introduce a fifth model of
the Max that could seat as many as 230 passengers.
Some leasing companies have criticized the move because it would
fragment the 737 family and make some of the types -- with
different seating capacities and flying ranges -- less attractive
as an investment.
Boeing is considering the 737 Max 10 model in response to the
sales success of the Airbus A321neo jet.
"There were, believe it or not, some positive comments out of
Istat," said Mr. Leverkuhn, referring to an industry conference
this week where criticism from some leasing companies surfaced.
Write to Doug Cameron at doug.cameron@wsj.com
(END) Dow Jones Newswires
March 08, 2017 12:44 ET (17:44 GMT)
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