Boeing Took $1B Hit on Dreamliner Problem, Expects 737 MAX Production Increase

The Boeing Company has reported a third-quarter profit of $15.3 billion, reporting higher commercial airplane sales and service volume amidst an improving economy. Though the company seems to have suffered a decade’s worth of bad luck in less than a year, the outlook is fairly positive, with strong sales interest and service agreements.

Boeing says progress on the global return to service of their 737 MAX is smooth, likely helped along by rumors that Chinese authorities may authorize it once again in the coming months. Since the FAA gave approval for the aircraft to hit the skies in the U.S. in November 2020, Boeing has delivered almost 200 MAXes with about the same number having reentered operating schedules. Production has been increased to 19 per month, with a target of 31 sometime next year. Boeing seems content to play the increase by ear, as the uncertainty of the Chinese market hangs over them. 

The 787 Dreamliner has also taken unforeseen resources, inspections, and reworks as Boeing works with FAA regulators to resume delivery. It had to halt deliveries in July when an improper joining in some plane’s fuselages failed to meet structural standards, requiring an estimated $1 billion in abnormal costs. The production line continues at a rate of 2 aircraft per month, with a projected rate of 5 as the 787’s issues are ironed out.

The Commercial Airplanes arm of Boeing sold 70 737 MAX and 24 of its freighter variant, with 12 787 airplanes. All told, The delivered 85 planes in the 3rd quarter, and currently has a backlog for 4,100 aircraft valued at $290 billion. Multiple projects and contracts are held for foreign defense customers and overhauls. The backlog for their Defense, Space, and Security orders is valued at $58 billion, with 33% of that coming from foreign customers. Boeing has a positive outlook, undeterred by their difficulties in recent years. Boeing President and CEO David Calhoun said: 

"We are driving stability across our operations, investing in our future and positioning our teams to deliver for our customers as the market recovers," said Calhoun. "Commercial market demand continues to gain traction with broad-based vaccine distribution and border protocols beginning to open. Going forward, supply chain capacity and global trade will be key drivers of our industry and the broader economy's recovery. Our portfolio across commercial, defense, space and services is well positioned, and we're focused on improving performance, while advancing technologies and digital manufacturing capabilities to drive our next generation of products and a sustainable future."

FMI: www.boeing.com