Boeing believes the 737 customer and supplier base can support a further increase in production beyond the planned rate of 47 aircraft per month in 2017, says Commercial Airplanes chief executive Ray Conner.
The 737 line has seen steady increases in output since late 2011, rising from 31 per month three years ago to 42 per month now.
The next rate increase is still three years away, but Boeing is already feeling pressure from customers and its own sales team. They want Boeing to push the rate even higher than 47 per month, perhaps as soon as six months after the next rate increase, Conner says.
The initial goal of such a rate increase is to create capacity to sell more 737NGs, the version being replaced by the 737 Max starting in the third quarter of 2017.
“It’s similar to what we saw on the Classics,” Conner says. “There was more demand and the NG is a fantastic product still – and the earlier availability always helps.”
Right now, Ryanair understands that it is buying the last 737NG on the production line, expecting to take delivery of the 737-800 in third quarter of 2019. Boeing plans to build the 737 Max and 737NG simultaneously for two years before production of the latter expires.
“If we [build more 737s] it does open more space,” Conner says. “Frankly, I’d like to have more space.”
Boeing also has assessed that demand for narrowbodies can support higher 737 production than already planned levels for a long time.
“I think we have enough demand that we know we can sustain that for a long time,” Conner says, pointing to growing replacement and growth requirements in China.
Boeing also has determined that the supply chain is ready to support another increase in production, he says.
A key chokepoint of production – the 737 wing assembly line in Renton, Washington – has recently been expanded to support up to 63 wingsets per month. A third final assembly line will open in Renton in 2015, which also raises potential capacity to 63 aircraft per month.
Spirit AeroSystems, of Wichita, Kansas, produces about 70% of the 737, including the entire fuselage. Spirit has the capacity to increase beyond 47 per month, Conner says.
Source: Cirium Dashboard
