Airlines will have fewer planes than they anticipated to serve large numbers of travelers this summer as a result of Boeing’s most recent production-related delay.
CEO David Calhoun stated on Tuesday that the business will not be able to deliver dozens of 737 Max aircraft to airlines in time for the summer travel season due to inspections and repairs relating to prohibited fuselage sections.
He said that it won’t have an impact on efforts to boost the best-selling plane’s production pace.
During Boeing’s annual shareholder meeting, Calhoun stated that this summer’s airline schedules will lose around 9,000 seats due to supply delays.
Although the CEO withheld the number of aircraft used in that calculation, the average number of seats in a mid-sized Max indicated that roughly 50 aircraft are anticipated to be delivered behind schedule.
Similar circumstances occurred in 2017 when Boeing was prevented from delivering larger 787 aircraft due to production faults and several flights and itineraries were canceled.
Boeing wants to increase manufacturing of the Max, which was stopped in late 2019 after two of the aircraft were involved in disasters in Ethiopia and Indonesia that resulted in the deaths of a combined 346 people.
The pace of production is still below that of before the collapse.
Last Monday, Boeing revealed that fittings where the tail is joined to the fuselage of the majority of Max aircraft models produced since 2019 were made using a “non-standard manufacturing process” by subcontractor Spirit AeroSystems.
At the time, Boeing warned that the problem may lead to delays in the creation and delivery of a “significant number” of the aircraft.
The company’s stance that the fittings don’t pose a safety risk for aircraft carrying people was reiterated by Calhoun. Airlines have not been given any instructions by the Federal Aviation Administration on those planes.
Preliminary findings, according to Boeing, revealed that the 13 board candidates put up by the business, which lost $5 billion in 2018 and roughly $22 billion since the year’s beginning, were chosen by the company’s shareholders.
Investors inquired as to when the business may reinstate the dividend that had been stopped in early 2020. Before giving more money to shareholders, Calhoun and Chairman Lawrence Kellner stated that they wanted to invest in the company and pay down debt.
Tuesday saw gains of 1.6% for Boeing and 7.8% for Spirit AeroSystems.
Boeing, situated in Arlington, Virginia, is expected to release first-quarter earnings in April.