Boeing production problem spills over into summer travel

FILE – In this file photo taken on Wednesday, September 30, 2020, a Boeing 737 Max jet piloted Steve Dickson of the Federal Aviation Administration prepares to land after a Seattle test flight at Boeing Field. Boeing announced Thursday, April 13 2023 that the production and delivery of an 'important number' of its Boeing 737 Max aircraft could be delayed due to questions regarding a supplier's fuselage work.

Elaine Thompson/AP

Boeing's production problems have caused a setback, and airlines will not be able to accommodate the large number of passengers expected this summer.

David Calhoun, CEO of Boeing, said on Tuesday that inspections and repair work related to non-approved fuselage components will prevent the company delivering dozens 737 Max jetliners in time for summer. He said that the inspections and repairs related to unapproved fuselage parts will prevent the company from delivering dozens of 737 Max jetliners to airlines in time for the summer season.

Calhoun stated during Boeing's annual shareholders meeting that the delays in delivery will take away 9,000 seats this summer from airline schedules.

The CEO did not give the number used to calculate the delivery date, but based on the typical number of seats in a Max mid-size plane, it is expected that 50 planes will be late.

Last year, Boeing was unable to deliver larger 787 planes due to production problems, and some airlines canceled flights and routes.

Boeing wants to increase production of Max planes, which were halted at the end of 2019 following two crashes in Indonesia and Ethiopia in which 346 people died. The production rate has not yet recovered to its pre-crash levels.

Boeing revealed last week that Spirit AeroSystems, a subcontractor, used a "non-standard process" on fittings at the point where the tail attaches to the fuselage for most Max jets manufactured since 2019. Boeing stated that this issue could lead to delays in the production and delivery of a "significant number" of Max jets.

Calhoun reiterated the company's position, that the fittings don't pose a safety concern for planes carrying passengers. Federal Aviation Administration (FAA) has not given airlines any orders to modify these jets.

Boeing announced that preliminary results indicated that its shareholders had elected the 13 board members nominated by the company. The company lost $5 billion in the last year, and almost $22 billion since 2019.

Shareholders wanted to know when the company would resume a dividend that was suspended at the beginning of 2020. Calhoun, along with Chairman Lawrence Kellner, said that they wanted to invest more in the company and reduce debts before returning money to shareholders.

Boeing shares rose 1.6% Tuesday and Spirit AeroSystems shares climbed 7.8%.

Boeing, based in Arlington, Virginia is expected to release its first-quarter results on April 26.