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Boeing plans to increase 737 airliner output

Keywords: Tags  Boeing, aerospace, Boeing 737, Boeing 787, Beverly Wyse, Cowen & Co., Cai von Rumohr, titanium Frank Haflich


LOS ANGELES — Boeing Co. said it will increase production of its 737 airliner to 47 planes per month in 2017.

The Chicago-based aerospace giant had already planned to increase output to 42 planes per month in 2014 from 38 planes per month.

The move will eventually raise the annual build rate of 737s to more 560 per year, increasing the plane’s output by nearly 50 percent since 2010, Boeing said.

"This increase will lay a solid foundation as we bridge into production on the 737 MAX," Boeing Commercial Airplanes vice president and general manager Beverly Wyse said, referring to the plane’s newest, re-engined version, which is due to enter service in 2017.

Boeing builds the 737 in Renton, Wash. Speculation that the rate could rise above 42 has been growing since December 2011, when the International Association of Machinists and Aerospace Workers union approved a four-year contract that ensured the plane would continue to be assembled in Renton (amm.com, Dec. 9, 2011).

Industry analysts noted the risk of orders drying up for the current version of the plane, the 737 Next Generation, as the newest re-engined version, the 737 MAX, ramps up. But Boeing’s public commitment to increase the 737 build rate suggests it is "comfortable with the integrity" of its total 737 backlog of 3,467 orders, Cai von Rumohr, a securities analyst at New York-based Cowen & Co. LLC, said in a note to investors.

Boeing’s announcement indicates "the risk of a downturn in 737 production in front of initial delivery of the MAX in 2017 looks increasingly remote," von Rumohr added.

Boeing said it would increase the build rate on its wide-body, titanium-intensive 787 Dreamliner, which is due to reach 10 planes per month by the end of the year vs. the current seven planes, and 12 planes per month by 2016 (amm.com, Oct. 23).


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