Boeing has said it can develop new 737 MAX engine inlets in a year or less and sees the task as the new primary pacing item for 737-7 and 737-10 certification, CEO Dave Calhoun said.
“We’ll step up resources, we’ll step up whatever testing is required, and we will do everything we can to inform the FAA about that particular part of that program,” Calhoun said on Boeing’s January 31 call on 2023 fourth quarter (Q4) earnings. “That is the pole in the tent all of us should be watching.”
CFO Brian West said developing the new inlets “will take about a year.” Calhoun, recapping a recent conversation with Sen. Tammy Duckworth (D-Ill.), said he told the senator the time frame could be closer to nine months.
The new inlets are needed to address a hazard that could see the composite parts overheat and fail if engine anti-ice is used in certain circumstances—notably dry air. Boeing petitioned the FAA to have the 737-7 certified while it developed a permanent fix and introduced it on the 737-10. But the company on Jan. 30 confirmed it would reverse course, pull its request, and incorporate the change—which will be retrofitted on all in-service 737 MAXs as well as on new aircraft—as part of 737-7 certification.
The ramifications mean launch customer Southwest Airlines likely will not put its first 737-7s into revenue service until mid-2025 at the earliest. The carrier has long said it would need about six months following initial deliveries to get FAA approvals for manuals, extended operations—ETOPS—and other airline-specific items.
West downplayed the ramifications of another year or so of certification work on the 737’s projected delivery pace. The company’s undelivered inventory of around 200 737 MAXs includes a total of 35 737-7s and 737-10s.
Meanwhile, the company is committed to satisfying FAA’s stepped-up scrutiny on both ongoing certification programs and 737 production. Fallout from the Jan. 5 Alaska Airlines 737-9 exit plug failure prompted the agency to order additional surveillance on Boeing and hold off on approving planned 737 production rate increases beyond the approved figure of 38 per month.
“We’ll maintain production at 38 per month and work transparently with the FAA to complete all requirements for future increases,” West said, adding that the current rate does not include any “blanks,” or empty final assembly line positions sometimes used to help manage production flow.
Boeing’s 737 supply chain may be delivering at or above a level that supports producing 38 aircraft per month, but rollouts have been consistently lower. Data compiled by consultants Aero Analysis Partners/AIR show Boeing averaged about 24 737 roll-outs per month in the fourth quarter and just more than 28 per month for the full year. It reached 38 back in June, rolling out 40, but quickly dropped amid production quality issues that slowed the lines and required re-work.
While roll-outs may lag below Boeing’s nominal rate, monthly deliveries could reach or even top 38 per month thanks to airplanes coming out of stored inventory. The 35 uncertified aircraft won’t move for a while, but Calhoun confirmed that deliveries to China have resumed “one at a time.” Most of the 200 737 MAXs awaiting delivery are destined for China or India.
“We still expect to deliver most of these airplanes by year-end as we work towards shutting down the shadow factory” conducting reactivation and rework activities, West said. About 25 of the 200 inventoried 737s are 2023 rollouts that still require some work before delivery, he added.
The 787 program is operating at a production rate of five per month and is on pace to get to 10 per month in the 2025-26 time frame. Boeing has about 60 787s in its undelivered inventory—50 of which need rework before delivery to correct production problems.
Production on the 777-9 resumed last quarter and the program timeline “remains unchanged,” West said. Boeing’s latest time line for the program, which has suffered several notable delays, sees first deliveries in 2025.