Boeing Boosts 737 Shipments From Six-Year Low as Parts Jam Eases
(Bloomberg) -- Boeing Co. delivered 48 of its 737 narrow-body jetliners in August, rebounding from a six-year low as the planemaker tackled production snags on its largest source of profit.
Total commercial-aircraft shipments rose to 64 last month from 39 in July, Boeing said Tuesday. While the 737 deliveries were four shy of the monthly production rate, they were an improvement from the 29 planes shipped a month earlier as parts shortages and out-of-sequence work ballooned at a Seattle-area factory. The July figure was the lowest for any month since 2012.
The company blamed late deliveries of fuselages from Spirit AeroSystems Holdings Inc. and engines from a General Electric Co.-Safran SA joint venture for the 50-odd aircraft parked in nooks and crannies around the Renton, Washington, factory and an adjacent air field. Boeing executives told analysts last week that it had brought in 600 mechanics from around the Puget Sound region to help tackle the logjam.
“August deliveries were a tad stronger than expected, but further lift is required in September to hit our Q3 estimates,” Cai von Rumohr, an analyst at Cowen & Co., said in a note to clients. He predicted a “healthy recovery” for Boeing’s 737 deliveries in the fourth quarter, with strong earnings and cash-flow gains for the company through 2021.
Boeing climbed 1.1 percent to $345.63 at 2:04 p.m. in New York. The shares advanced 16 percent this year through Monday, compared with the 2.4 percent advance for a Standard & Poor’s index of industrial stocks.
Airbus SE, which has also been grappling with supplier issues, reported last week that it delivered 54 jetliners, down from 77 a month earlier, amid the European company’s usual summer shutdown. The August shipments included 42 narrow-body jets, down from 63 a month earlier.
The drop was accentuated by a rush of Airbus deliveries in July as Pratt & Whitney works to recover its A320neo engine shipments. The engine maker was forced to halt new handovers for three months at the start of the year due to an engine glitch that led to scores of planes being parked without turbines outside Airbus factories. Total deliveries last month, including of the recently acquired A220, were up from 43 a year earlier.
Boeing delivered only eight of its 787 Dreamliners last month, the same pace as July. The manufacturer’s marquee carbon-fiber jet has been hampered by shortages of seats and other cabin equipment along with production shortfalls for its Rolls-Royce Holdings Plc engines.
The Chicago-based planemaker also netted 90 new 737 family orders during August, bringing its total for the year to 424 of the single-aisle jets. Airbus recorded five new jet orders in August, all for its A320 family, and has netted 219 airliner sales for the year to 581 for Boeing.
©2018 Bloomberg L.P.