Boeing to Increase 737 Production to 47 Jets Per Month
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 10 hours ago
0mins
Source: CNBC
- Production Increase Plan: Boeing has met FAA requirements to raise its 737 Max production to 47 jets per month from the current 42, with expectations to achieve this in the coming months, demonstrating the company's proactive approach to meeting market demand.
- Line Stability: CEO Kelly Ortberg stated that while Boeing has previously reached a peak of 57 jets per month, it cannot sustain that rate currently due to safety and quality processes, emphasizing the importance of maintaining product integrity while pursuing higher output.
- Future Growth Potential: Ortberg mentioned that Boeing aims for a future production rate of 63 jets per month, with market demand supporting higher rates, reflecting the company's confidence in future market conditions and strategic planning for capacity expansion.
- Gradual Target Advancement: Although Boeing plans to achieve the 47 jets per month rate in the coming months, Ortberg acknowledged that reaching the 52 jets per month target could take at least six months, indicating a cautious approach to expanding production capabilities.
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Analyst Views on BA
Wall Street analysts forecast BA stock price to rise
16 Analyst Rating
14 Buy
1 Hold
1 Sell
Strong Buy
Current: 218.900
Low
150.00
Averages
269.14
High
298.00
Current: 218.900
Low
150.00
Averages
269.14
High
298.00
About BA
The Boeing Company is an aerospace company. Its segments include Commercial Airplanes (BCA), Defense, Space & Security (BDS), and Global Services (BGS). Its BCA segment develops, produces and markets commercial jet aircraft principally for the commercial airline industry worldwide. Its family of commercial jet aircraft in production includes the 737 narrow-body model and the 767, 777 and 787 wide-body models. Its BDS segment is engaged in the research, development, production and modification of manned and unmanned military aircraft and weapons systems for strike, surveillance and mobility. Its BGS segment provides services to its commercial and defense customers worldwide. It sustains aerospace platforms and systems with a range of products and services, including supply chain and logistics management, engineering, maintenance and modifications, upgrades and conversions, spare parts, pilot and maintenance training systems and services, technical and maintenance documents, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Boeing to Increase 737 Production to 47 Jets Per Month
- Production Increase Plan: Boeing has met FAA requirements to raise its 737 Max production to 47 jets per month from the current 42, with expectations to achieve this in the coming months, demonstrating the company's proactive approach to meeting market demand.
- Line Stability: CEO Kelly Ortberg stated that while Boeing has previously reached a peak of 57 jets per month, it cannot sustain that rate currently due to safety and quality processes, emphasizing the importance of maintaining product integrity while pursuing higher output.
- Future Growth Potential: Ortberg mentioned that Boeing aims for a future production rate of 63 jets per month, with market demand supporting higher rates, reflecting the company's confidence in future market conditions and strategic planning for capacity expansion.
- Gradual Target Advancement: Although Boeing plans to achieve the 47 jets per month rate in the coming months, Ortberg acknowledged that reaching the 52 jets per month target could take at least six months, indicating a cautious approach to expanding production capabilities.
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- Funding Allocation: Approximately $2.1 million of the contract is funded by Navy resources, while about $852.6 million comes from Foreign Military Sales customer funds, showcasing Boeing's strong performance in international markets and reliance on foreign military sales.
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- Production Rate Increase: The FAA supports Boeing's decision to raise the 737 MAX production rate from 42 to 47 planes per month, with further increases expected in the next 90 days, which will help meet market demand and enhance the company's profitability.
- New Production Line Opening: Boeing aims to increase production to 52 jets per month early next year, following the opening of a fourth 737 production line in Everett, Washington, which will further strengthen its production capacity and competitiveness in the market.
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Boeing to Increase 737 Production to 47 Jets Per Month
- Production Increase Plan: Boeing has met FAA requirements to raise its 737 Max production to 47 jets per month from the current 42, with expectations to achieve this in the coming months, demonstrating the company's proactive approach to meeting market demand.
- Line Stability: CEO Kelly Ortberg stated that while Boeing has previously reached a peak of 57 jets per month, it cannot sustain that rate currently due to safety and quality processes, emphasizing the importance of maintaining product integrity while pursuing higher output.
- Future Growth Potential: Ortberg mentioned that Boeing aims for a future production rate of 63 jets per month, with market demand supporting higher rates, reflecting the company's confidence in future market conditions and strategic planning for capacity expansion.
- Gradual Target Advancement: Although Boeing plans to achieve the 47 jets per month rate in the coming months, Ortberg acknowledged that reaching the 52 jets per month target could take at least six months, indicating a cautious approach to expanding production capabilities.
See More
Dell Secures $9.69 Billion Defense Software Contract
- Massive Contract Award: Dell has secured a $9.69 billion blanket purchase agreement aimed at simplifying and consolidating software procurement for the Department of Defense and intelligence agencies, thereby enhancing procurement efficiency and responsiveness across government departments.
- Positive Market Reaction: Following the announcement, Dell's shares rose nearly 7% in after-hours trading, reflecting investor optimism regarding the company's growth potential, particularly against the backdrop of strong demand in the defense and government sectors.
- Technological Integration Advantage: The agreement will allow agencies to access Microsoft software licenses, cloud subscriptions, and Software Assurance through a unified framework, further solidifying Dell's market position in the defense sector while promoting the expansion of cloud and hybrid capabilities.
- Competitive Win: Dell Federal Systems won the contract after a competitive process, showcasing its strong capabilities in the government contracting space, which is expected to drive long-term revenue growth and increase market share for the company.
See More
Boeing Secures $854.7M Contract Modification for P-8A Production
- Contract Value: Boeing has received an $854.7 million modification to its contract primarily for the production of P-8A Lot 13 aircraft, indicating sustained demand in the defense sector and a stable revenue stream for the company.
- Engineering Upgrades: The contract also encompasses additional engineering work for P-8A upgrades, addressing supply chain issues, software integration, and hardware updates, reflecting Boeing's commitment to enhancing product competitiveness and meeting customer needs.
- Funding Allocation: Approximately $2.1 million of the contract is funded by Navy resources, while about $852.6 million comes from Foreign Military Sales customer funds, showcasing Boeing's strong performance in international markets and reliance on foreign military sales.
- Project Timeline: The contract work is expected to be completed by September 2030, providing Boeing with long-term revenue assurance while also highlighting the complexity and longevity of defense projects.
See More
Mixed Close for US Indices as Oil Prices Ease
- Mixed Market Performance: On Wednesday, US stock indices closed mixed, with the S&P 500 ending flat, the Nasdaq 100 down 0.1%, and the Dow Jones Industrial Average rising 0.4% to 50,644.28 points, reflecting investor caution amid mixed signals.
- Oil Price Decline: US crude oil prices fell 5.55% to settle at $88.68 per barrel after Iranian media claimed a commitment to restore commercial traffic through the Strait of Hormuz, although the White House denied this report, indicating ongoing uncertainty in oil price trends.
- Tech Stock Pullback: Chipmakers like Qualcomm (QCOM) and Intel (INTC) experienced pullbacks on Wednesday as investors grew wary of persistent inflation and imminent rate hikes, leading to the Nasdaq snapping a four-day winning streak.
- Meta's Subscription Plans: Shares of Meta Platforms (META) rose following reports that the company plans to launch paid consumer subscriptions for its Meta AI chatbot, highlighting its strategic expansion in the artificial intelligence sector.
See More
FAA Expects Boeing 737 MAX 7 Certification This Summer
- 737 MAX 7 Certification Progress: FAA Administrator Bryan Bedford anticipates that the Boeing 737 MAX 7 will receive certification this summer, while the larger MAX 10 is expected to be approved by year-end, providing crucial support for Boeing's market recovery.
- Production Rate Increase: The FAA supports Boeing's decision to raise the 737 MAX production rate from 42 to 47 planes per month, with further increases expected in the next 90 days, which will help meet market demand and enhance the company's profitability.
- New Production Line Opening: Boeing aims to increase production to 52 jets per month early next year, following the opening of a fourth 737 production line in Everett, Washington, which will further strengthen its production capacity and competitiveness in the market.
- Quality and Safety Collaboration: The FAA emphasizes collaboration with Boeing to ensure a focus on quality and safety during production, avoiding rework due to quality issues, thereby enhancing overall production efficiency and market trust.
See More
Jim Cramer Recommends Four Stocks for New Investors
- Diversification Strategy: Jim Cramer emphasized the need for diversification even as artificial intelligence dominates the market, ensuring long-term stability in investment portfolios to mitigate risks associated with single-theme investments.
- Stock Recommendations: Cramer recommended four stocks for new members to buy, including Alphabet, Amazon, Apple, and Nvidia, all of which demonstrate strong growth potential, particularly in their AI-related businesses.
- Market Outlook: Despite challenges faced by Meta and Microsoft, Cramer remains cautiously optimistic about their future performance, suggesting that these companies could achieve breakthroughs in the evolving AI landscape.
- Emerging Investment Opportunities: Stocks like Arm Holdings and Broadcom are showing strong performance, particularly in the data center and AI chip sectors, reflecting robust market demand for related technologies, making them worth watching for long-term growth potential.
See More
