Boeing Co., one of the leading aerospace companies, has recommenced the production of its popular 737 MAX jetliners, according to a report by Reuters, citing sources familiar with the developments. The company faces the significant task of fulfilling approximately 4,200 orders from airlines amidst a rapidly expanding global demand for air travel.
This production restart comes shortly after the resolution of a seven-week strike involving 33,000 factory workers, who voted to accept a new contract. The strike had severely impacted the manufacturing of Boeing's key models, including the 737 MAX, as well as the 767 and 777 widebody planes.
Production for the 737 MAX, disrupted by both the strike and recent safety concerns, resumed last Friday. Interestingly, Mike Whitaker, the head of the Federal Aviation Administration (FAA), had mentioned the plan to resume production later in December.
Amidst increasing demand for the 737 MAX, Boeing had previously aimed to ramp up its production to a target of 56 airplanes per month. However, the production line has faced numerous interruptions over the past few years. Challenges have included two tragic crashes, the COVID-19 pandemic, supply chain disruptions, and safety concerns, all leading to extensive regulatory scrutiny. The recent strike further compounded these problems.
Analysts from Jefferies anticipate that Boeing will manufacture an average of 29 737 MAX planes monthly in 2025. In mid-November, Boeing also announced plans to reduce its workforce by cutting over 2,500 positions across various U.S. operations as part of a wider strategy to eliminate 17,000 jobs, representing 10% of its global workforce.
These ongoing safety issues and production delays culminated in Boeing reporting a deeper net loss for its third quarter in October, largely due to charges in its commercial airplanes and defense units. The company's backlog at the quarter's close totaled $511 billion, comprising over 5,400 commercial airplanes.
Boeing's recent challenges began on January 5 when an incident involving a mid-cabin door plug on an Alaska Airlines 737-9 MAX led to a temporary grounding of nearly 171 737 MAX 9 planes for inspections. Furthermore, in early March, the FAA's production audit of Boeing and Spirit AeroSystems uncovered various quality control lapses, resulting in a halt to production expansion of the 737 MAX.
Notably, the 737 MAX was grounded globally in March 2019, after two crashes within six months resulted in the loss of 346 lives. At that time, it was the world's best-selling aircraft.
