Boeing has won approval from the FAA to ramp up production of the 737 MAX.
Speaking at the Bernstein Annual Strategic Decisions Conference in New York on Wednesday, CEO Kelly Ortberg said the company will up production of the narrowbody type from 42 to 47 per month.
“We just recently had our capstone review with the FAA – new news here – we passed the capstone review for rate 47,” Ortberg said. “So we are now in the process of running the line at the 47-a-month rate. It will probably take us a few months of stabilization there… My guess is we’ll continue to go up in rate, it may take a little bit longer, but we’re off and rolling now for the 47-a-month rate and we should be there in the next couple of months.”
Boeing’s next goal for the 737 MAX is to reach 52 airplanes per month, but that will require the activation of the company’s fourth MAX production line in Everett, Washington. The line will supplement three existing lines in nearby Renton.
Ortberg said Boeing is currently hiring workers for the Everett line and will soon move an aircraft through the plant to qualify the production system.
Asked if the manufacturer could again turn out 57 737 MAX jets per month from Renton alone – the rate prior to the type’s temporary grounding in 2019 – Ortberg said that pace is probably not sustainable for Renton given changes to the company’s safety and quality processes.
The goal, he said, is “stable production,” not rushing to deliver airplanes.
In the long term, Boeing is looking to reach 63 MAX aircraft per month as additional capacity comes online.
China Order
Asked about his recent trip to China with President Donald Trump and a subsequent order from Beijing for 200 aircraft – well below Wall Street expectations of around 500 – Ortberg said the visit was in fact “super successful” because it helped restore the company’s relationship with the Chinese government.
“My primary objective was to reopen that market to our narrowbody airplanes,” he said. “As you know we hadn’t had an order in nearly a decade, and we accomplished that, which is a major, major accomplishment. And I think people focus a little bit too much on the initial quantity. This is opening the market. They need well over 500 aircraft a year to support their GDP growth, so there’s a great market opportunity for us.”
While the Chinese government has given Boeing a commitment, the company will still need to meet with individual Chinese airlines to determine their aircraft needs, Ortberg said. Once that process has been completed, the commitment will “turn into” an order, he added, and the sale will be added to Boeing’s books.
