Boeing Revises 737 Max Delivery Forecast Owing to Production Snags

Boeing revealed a downward adjustment in its 737 Max delivery projection for the year, attributing this revision to persistent production complications that have translated into delays and financial setbacks. The Q3 2023 earnings, which were also released, showed the company’s adjusted loss surpassed market expectations.

Highlighting its new delivery target, Boeing anticipates the release of 375 to 400 units of its flagship 737 Max aircraft, marking a decline from its prior estimate, which oscillated between 400 and 450 units. This change stems from a supply chain flaw pertaining to the aft pressure bulkhead segment in select 737 aircraft, discovered in August, necessitating corrective measures.

The 737 Max, infamously known for its near two-year grounding following a couple of catastrophic crashes, is pivotal to Boeing’s financial trajectory. Post its re-certification, Boeing has been ardently pushing to amplify the production and dispatch of this model to cater to airline companies that are gradually recuperating from the aftershocks of the Covid-19 pandemic. Nonetheless, the manufacturing glitches have curtailed the delivery cadence and augmented associated expenses.

In elucidating the current situation, Boeing’s CFO, Brian West, conveyed that the firm envisions a delivery count of 70 737 Max aircraft for Q3 2023, of which 22 were accomplished in August. He accentuated that this hiccup is expected to be ephemeral, without casting any shadows over the aircraft’s integrity or functionality.

Furthermore, the quarterly financials portrayed a net loss of $1.6 billion, equivalent to $2.92 per share, a stark contrast to the preceding year’s Q3 loss of $466 million or $0.79 per share. The adjusted loss per share clocked in at $1.39, overshooting the general market anticipation of $0.62.

Revenue figures for Boeing showed a 9% annual increment, aggregating to $15.3 billion. This surge can be ascribed to escalated deliveries of wide-bodied aircraft, notably the 787 Dreamliner, and a bustling defense and space division. However, this revenue tally fell short of the anticipated $15.7 billion.

Endorsing the company’s resilience, Boeing’s CEO, Dave Calhoun, remarked that they have manifested commendable results across all segments, even in the face of adversities within the commercial aviation sector. He underlined Boeing’s unwavering commitment towards enhancing its operational finesse and scouting for avenues of prospective expansion.

Sources: AirGuide Business airguide.info, bing.com, cnbc.com