Suppliers are reportedly being told it will take longer to get output back up to speed
Boeing $BA (BA) continues to have trouble digging itself out of the hole left by its January door plug blowout scandal. Reuters reports that the company is telling suppliers that it will take longer than expected for its moneymaker 737 Max planes to ramp back up in production after a slowdown earlier this year.
The planemaker declined to comment to Reuters regarding the matter, instead referring the outlet to July earnings call comments from CFO Brian West where he said that Boeing’s “objective remains to keep the supply chain paced ahead of final assembly to support stability.”
The goal had been to up 737 Max production to 42 models a month by September. That goal is now getting pushed back to July. Though Boeing was telling suppliers this spring to keep their feet “on the gas,” they have nevertheless struggled with adjusting their businesses to an environment where Boeing is literally unable to use the parts they produce at a rate they’re used to. After the door plug incident, the Federal Aviation Administration capped output for the plane at 38 per month.
“The Max production rate is down in the first quarter, pretty well-documented by all accounts, and Boeing has expressed that they want to increase it as quickly as possible,” the CEO of electronics supplier Astronics (ATRO) said on an earnings call earlier this year. “They have not been clear with the world or certainly with us as to what that ramp is going to look like.”
When Boeing handed in a safety plan this May aimed at repairing the quality control processes that led to blowout, FAA head Mike Whitaker said that he still didn’t think his agency would be lifting the production cap “in the next few months.”
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