737 Moving Target

Last March, following two plane crashes, the FAA suspended Boeing 737 Max flights. Boeing expected the plane to be back in operation by the Summer, then September, then December, then February.

Today, Boeing Pushes Back Expected MAX Return until June or July.

Boeing on Tuesday pushed back its timetable for regulators to clear the return of the troubled 737 MAX for commercial service, saying it doesn’t expect approval until at least the middle of the year.

The company said its new estimate for the Federal Aviation Administration’s signoff—which people briefed on the matter expect in June or July—takes into account the need for approving training for pilots and “experience to date with the certification process.”

The internal target provided to airlines and suppliers is far longer than most airlines and industry analysts expected, leaving the global fleet short of almost 5% of planned capacity for the second peak summer season in a row, adding to the mounting compensation bill faced by Boeing.

No Surprise in This Corner

I fail to understand why another delay surprised analysts given that two days ago we learned 737 Max "Fix" Causes Entire Computer System to Crash

My comment: "The latest glitch is certain to cause more delays as well as increased lack of faith in the company."

Boeing Raising Cash

Wolf Richter reports After Blowing $43 Bn on Share-Buybacks in 6 Years, Boeing Scrambles to Borrow $10 Bn, on Top of a $9.5 Bn Credit Line in Oct, to Fund its 737 MAX Fiasco


What a hoot.

Expect a lot more stories like that.

Worst Yet to Come for Suppliers

Leeham reports Boeing Hasn’t Hit Bottom Yet. Neither Have Suppliers.

The impact on suppliers is going to be profound. Spirit Aerosystems last week announced it would lay off 2,800 employees for an indefinite period. It has no information from Boeing about the timing to restart production, nor at what rate.

The slow ramp-up means recalling employees, at Spirit, and any other supplier will be a gradual return to previous employment levels. It will be challenging for Small suppliers to stay in business.

That analysis predates today's announcement and the new computer system crash glitch.

A huge slowdown at Boeing and suppliers on top of a turndown in autos seals the fate of manufacturing for this economic cycle.

Key Manufacturing Details

  • For the first time in history, manufacturing production is unlikely to take out the previous pre-recession peak.
  • Unlike the the 2015-2016 energy-based decline, the current manufacturing decline is broad-based and real.
  • Manufacturing production is 2.25% below the peak set in december 2007 with the latest Manufacturing ISM Down 5th Month to Lowest Since June 2009.

In related discussion, please consider Recession Arithmetic: What Would It Take?

Mike "Mish" Shedlock

737 Max "Fix" Causes Entire Computer System to Crash

Boeing is now testing its 737 Max fix in real planes. In doing so, Boeing has uncovered yet another problem.

Boeing Will Suspend 737 Max Production: Thousands of Jobs at Risk

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Pilots Confront Boeing: 737 Max Crashes Were NOT Pilot Error

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Boeing 737 Max Suspension: What Really Happened?

This week, Boeing announced it would suspend production of the 737 Max in January. The timing and details are unusual.

Boeing 737 Max Major Design Flaws, Not a Software Failure

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Boeing Outsourced Software to $9 Programmers, Probe Expands Beyond the Max

Boeings problems continue to mount. The FAA discovered more problems and a DOJ probe expands beyond the Max.

More 737 Max Delays: Boeing's Corner Cutting Cost a Fortune and 346 Lives

The 737 Max may now be grounded for as much as a year. A new report assesses the corner cutting mistakes.

Orders at Boeing Drop to a 16-Year Low

New plane orders at Boeing are the lowest since 2005 and deliveries the lowest since 2005. Blame the Boeing 737 Max.

Emergency Order: Trump Grounds Boeing MAX Airplanes

Following 2 recent crashes of Boeing's newest aircraft, countries started banning flights. Today, the US followed.