Production The first 271 737s were built in Seattle at Boeing Plant 2, just over the road from Boeing Field, (BFI). However, with the sales of all Boeing models falling and large scale staff layoffs in 1969, it was decided to consolidate production of the 707, 727 and 737 at Renton just 5 miles away. In December 1970 the first 737 built at Renton flew and all 737s have been assembled there ever since.
However not all of the 737 is built at Renton. The fuselage has always (except for the first seven prototype fuselages; l/n 1-5, 7 and 9) been built in Wichita and brought to Renton by train. Also much of the sub-assembly work is outsourced beyond Boeing.
Follow this link to see a time lapse video of the production of a 737: http://www.flixxy.com/boeing-737-time-lapse.htm
*** Updated 23 Nov 2020 ***
Production methods have evolved enormously since the first 737 was made in 1966. The main difference is that instead of the aircraft being assembled in one spot they are now on a moving assembly line similar to that used in car production. This has the effect of accelerating production, which not only reduces the order backlog and waiting times for customers but also reduces production costs. The line moves continuously at a rate of 2 inches per minute; stopping only for worker breaks, critical production issues or between shifts. Timelines painted on the floor help workers gauge the progress of manufacturing.
When the fuselage arrives at Renton, it is fitted with wiring looms, pneumatic and air-conditioning ducting and insulation before being lifted onto the moving assembly line. Next, the tailfin is lifted into place by an overhead crane and attached. Floor panels and galleys are then installed and functional testing begins. In a test called the “high blow”, the aircraft is pressurised to create a cabin differential pressure equivalent to an altitude of 93,000 feet. This ensures that there are no air leaks and that the structure is sound. In another test, the aircraft is jacked up so that the landing gear retraction & extension systems can be tested. As the aircraft moves closer to the end of the line, the cabin interior is completed – seats, lavatories, luggage bins, ceiling panels, carpets etc. The final stage is to mount the engines. According to Boeing, there are approximately 600,000 total parts on a 737NG.
The present build time is reducing from 11 days (5,500 airplane unit hours of work) towards a future target of 8 days (4,000 airplane unit hours of work). The production rate has increased from 31 aircraft a month in 2005 to 42/month in 2014 and reached 57 aircraft a month by 2019 for the 737MAX.
737 MAX under construction (Photo LOT Polish Airlines)
Boeing CEO, Dennis Muilenberg, said in October 2017 "Our planned production rate for the 737, going to 57 per month in 2019, is based on our backlog of over 4,400 aircraft and a production skyline that is oversold through the end of the decade. We continue to assess the upward market pressure on the 737 production rate." i.e. he may further increase the 737 production rate. There was talk of reaching 60 per month by 2020 and 63 by 2021 to reduce "meltaway" of orders (cancellations) from the large backlog but the MAX grounding and Covid-19 pandemic crushed those aspirations.
After construction they make one flight, over to BFI where they are painted and fitted out to customer specifications. It takes about 200ltrs (50USgallons) of paint to paint a 737. This will weigh over 130kg (300lbs) per aircraft, depending on the livery. Any special modifications or conversions (eg for the C40A, AEW&C or MMA) are done at Wichita after final assembly of the green aircraft. Auxiliary fuel tanks, winglets, SATCOM and specialist interiors for BBJs are fitted by PATS at Georgetown, Delaware as these are STC (Supplemental Type Certificate) items.
There have only been two stoppages in 737 production since 1966. The first was an eight-week strike that started in Sep 2008 by 27,000 members of the International Association of Machinists, it cost Boeing $1.8 billion and affected all models. The second was in Dec 2019 when MAX production was suspended after the type was grounded in March 2019 and a backlog of over 400 completed aircraft that could not be delivered had built up. Boeing CFO Greg Smith said in Apr 2020 that he expects to resume 737 MAX deliveries in the third quarter following regulatory approvals, with production re-starting at low rates in the second quarter before gradually increasing to 31 per month by the beginning of 2022. Further gradual production increases will correspond with market demand. Boeing will focus on delivering jets that it has already built in order to unlock frozen cash.
In 2020 federal prosecutors and regulators started investigating factory missteps that “raise red flags” about Boeing’s compliance with production regulations. Boeing found debris such as tools and rags that were left behind by workers in about half of the Max jets the company inspected starting in November 2019 following the types grounding due to MCAS. Boeing said in a statement that “While conducting maintenance we discovered foreign object debris in undelivered 737 Max airplanes currently in storage. That finding led to a robust internal investigation and immediate corrective actions in our production system, which we have also implemented across all of our commercial airplane programs.”
The fuselage is a semi-monocoque structure. It made from various aluminium alloys except for the following parts.
Different types of alluminium alloys are used for different areas of the aircraft depending upon the characteristics required. The alloys are mainly aluminium, zinc, magnesium & copper but also contain traces of silicon, iron, manganese, chromium, titanium, zirconium and probably several other elements that remain trade secrets. The different alloys are mixed with different ingredients to give different properties as shown below:
Fuselage skin, slats, flaps - areas primarily loaded in tension - Aluminium alloy 2024 (Aluminium & copper) - Good fatigue performance, fracture toughness and slow propagation rate.
Frames, stringers, keel & floor beams, wing ribs - Aluminium alloy 7075 (Aluminium & zinc) - High mechanical properties and improved stress corrosion cracking resistance.
737-200 only: Bulkheads, window frames, landing gear beam - Aluminium alloy 7079 (Aluminium & zinc) Tempered to minimise residual heat treatment stresses.
Wing upper skin, spars & beams - Aluminium alloy 7178 (Aluminium, zinc, magnesium & copper) - High compressive strength to weight ratio.
Landing gear beam - Aluminium alloy 7175 (Aluminium, zinc, magnesium & copper) - A very tough, very high tensile strength alloy.
Wing lower skin - Aluminium alloy 7055 (Aluminium, zinc, magnesium & copper) - Superior stress corrosion.
See also fuselage page for further details about fuselage structure.
On 12 Jan 2018 Boeing announced that the 737 MAX programme reached a "signature moment" after the MAX 7, MAX 8 and MAX 9 aircraft all shared the "same production line simultaneously" at its Renton factory.
In April 2019 737 production was dropped to 42/month in the wake of the MAX grounding. Production was stopped in Dep 1019 because of the backlog. Boeing intended to resume production of the MAX at a rate of 52 aircraft per month, increasing to a record 57 jets monthly as market conditions allow.
Many components are not built by Boeing but are outsourced to other manufacturers both in the US and increasingly around the world. This may be either for cost savings in production, specialist development or as an incentive for that country to buy other Boeing products. Here is a list of some of the outsourced components:
Production Article from Boeing:
Boeing Commercial Airplanes performs major assembly of all 737s at
its factories in the United States; however, parts for the airplanes
come from suppliers all over the world.
21 May 2021 - Boeing to Increase Production of the MAX
It is being reported that Boeing will increase the MAX production rate to 26 a month by late 2021, 31 a month by early 2022 and 42 a month by autumn 2022.
Production increses will depend upon demand, which is in turn COVID dependant and the ability of suppliers to increase their output.
Before the 2 year MAX grounding of March 2019, Boeing was producing 52 a month and was planning to increase to 57 a month.
05 Feb 2021 - Tata Boeing Aerospace Limited to Manufacture 737 Vertical Fin Structures in Hyderabad, India
Boeing [NYSE: BA] today announced the addition of a new production line at its joint venture, the Tata Boeing Aerospace Limited (TBAL) in Hyderabad, Telangana, to m
anufacture complex vertical fin structures for the 737 family of airplanes. The expansion marks a significant milestone for the joint venture.
“This is a noteworthy step in the growth of India’s aerospace and defence manufacturing,” said K. T. Rama Rao, Telangana Municipal Administration and Industries Minister. “Telangana is an established hotbed for India’s defence and aerospace industry supported by a robust ecosystem, including a large pool of skilled and industry-ready work-force. I congratulate Boeing and Tata for this milestone,” he added.
“Tata Boeing Aerospace Limited is an example of Boeing’s commitment towards co-development of integrated systems in aerospace and defence in India, for the world, and a reflection of the country’s Atmanirbhar Bharat initiative,” said Salil Gupte, president, Boeing India. “Skilled talent, robust infrastructure, ease of doing business, and a highly responsive government administration make Telangana an ideal destination,” he added.
Sukaran Singh, Managing Director and Chief Executive Officer, Tata Advanced Systems, said, "The expansion of our aerostructure manufacturing capabilities with the new production line to deliver complex vertical fins for the 737s is another landmark in our collaboration with Boeing. He further added, “This new production line for complex vertical fin structures is another testament for TASL’s commitment towards making India self-reliant in defence manufacturing.”
The vertical fin is a complex structural part and the new production line will utilize cutting-edge robotics and automation in manufacturing. The expansion will create additional employment opportunities and enable skill development as well. Spread over 14,000 square meters, the state-of-the-art facility has been producing aero-structures for Boeing’s AH-64 Apache helicopter, including fuselages, secondary structures, and vertical spar boxes for customers worldwide.
17 Dec 2018 - Boeing to suspend production of the MAX until recertification
Production of the MAX, which was grounded after two fatal accidents, will remain on hiatus until regulators determine when they can be certified and returned to service.
On 16 Dec Boeing said that it had continued to build planes after the program was halted and that about 400 are now in storage and that it would prioritize delivering those planes instead of focusing on more production.
Boeing said it does not plan to lay off or furlough workers at the Renton, Washington, factory where the 737 Max is produced during the production pause. Some of the 12,000 workers there will be temporarily reassigned.
Boeings full statement:
Safely returning the 737 MAX to service is our top priority. We know that the process of approving the 737 MAX's return to service, and of determining appropriate training requirements, must be extraordinarily thorough and robust, to ensure that our regulators, customers, and the flying public have confidence in the 737 MAX updates. As we have previously said, the FAA and global regulatory authorities determine the timeline for certification and return to service. We remain fully committed to supporting this process. It is our duty to ensure that every requirement is fulfilled, and every question from our regulators answered.
Throughout the grounding of the 737 MAX, Boeing has continued to build new airplanes and there are now approximately 400 airplanes in storage. We have previously stated that we would continually evaluate our production plans should the MAX grounding continue longer than we expected. As a result of this ongoing evaluation, we have decided to prioritize the delivery of stored aircraft and temporarily suspend production on the 737 program beginning next month.
We believe this decision is least disruptive to maintaining long-term production system and supply chain health. This decision is driven by a number of factors, including the extension of certification into 2020, the uncertainty about the timing and conditions of return to service and global training approvals, and the importance of ensuring that we can prioritize the delivery of stored aircraft. We will continue to assess our progress towards return to service milestones and make determinations about resuming production and deliveries accordingly.
During this time, it is our plan that affected employees will continue 737-related work, or be temporarily assigned to other teams in Puget Sound. As we have throughout the 737 MAX grounding, we will keep our customers, employees, and supply chain top of mind as we continue to assess appropriate actions. This will include efforts to sustain the gains in production system and supply chain quality and health made over the last many months.
15 Dec 2018 - First MAX finished in Zhoushan, China
Boeing has handed over the first 737 Max completed in the country to Air China. It was the first to be delivered outside the US by Boeing, although for all intents and purposes it bore a “Made in USA” label. It marked the debut of Boeing’s plane completion and delivery centre in Zhoushan, 140 kilometres southeast of Shanghai. The completion part of the facility is a joint venture with state-owned Commercial Aircraft Corp of China Ltd. Chinese workers at the new plant will put the finishing touches on US-built planes flown over from a Seattle-area factory, before delivering them to local customers.
24 Feb 2017 - Boeing to open first fabrication facility in Europe in Sheffield, England
A new production line will be built this year in Sheffield, England for parts for 737 and 777 gear systems and flight controls as part of a move to bring more production in-house. Boeing has a long-established association with Sheffield University's Advanced Manufacturing Research Centre (AMRC). Boeing will spend $25 million on a 25,000-square-foot facility in Sheffield will work closely with Boeing Portland, a company Center of Excellence for complex machining, gear systems and flight controls. The Sheffield plant will employ about 30 people when it opens, Boeing said.
Boeing Vice President for Supplier Management, Kent Fisher said "For these particular actuation systems it made sense to have greater capability in-house and addressed affordability issues with the supply chain...The existing supply base was not providing us with the affordability we needed to stay competitive, there is a performance issue in the supply base and they were unable to meet production rates. Also, we feel for the long term it's important that having internal capability is essential to our success."
25 Jan 2017 - Boeing on course to increase 737 production rate
Boeing CEO Dennis Muilenburg reaffirmed on a conference call with investors on 25 Jan 2017 that the 737 prouction rate increases from 42 aircraft a month to 47 this year, andthen to 52 in 2018 and 57 in 2019 are still planned and on track, despite the skepticism of some industry observers that future demand might not support the higher volumes.
And even at that eventual rate in 2019, Muilenburg said, the company remains “oversold” on the 737. Boeing currently has a total of 4,452 orders for all variants of its 737 aircraft included in its unfilled backlog. "Simply put, this is a big attractive market and the 737 family's position within it is solid," Muilenburg said.
8 Dec 2015 - Boeing always reviewing 737 production rate
As the first 737 Max 8 test aircraft moves the pre-flight phase, Boeing now has one-third more production capacity in the 737 final assembly centre in Renton, Washington. The first product to emerge from the newly-opened “central line” gives Boeing more flexibility to respond to Airbus’ recent decision to increase A320 output to 60 aircraft per month before 2020.
So far, company officials haven’t announced a similar plan to raise production beyond a target of 52 per month set for 2018. But executives have said there remains “upward pressure” on 737 demand and negotiations are ongoing with the supply chain. “We are studying all the time,” says Keith Leverkuhn, Boeing vice-president and general manager of the 737 programme. “Airbus made their announcement. We like where we’re at. [Boeing] is challenging the supply chain all the time going, ‘What if? How high can you go?’”
In a different way, “going higher” was exactly how Boeing created extra capacity in Renton’s densely-packed facility. Whereas Airbus spreads final assembly across four production lines scattered across Europe, China and the USA, Boeing concentrates 737 final assembly under a single roof with two hangar bays named 4-81 and 4-82. Each hangar has contained a single assembly line with an adjacent feeder line running alongside. To establish a third assembly line, Boeing consolidated both feeder lines into a single, three-level vertical structure called the systems integration tool inside the 4-82 hangar. On the top two floors, workers install wiring and electronic systems inside completed fuselages nestled into nine available positions, with three positions each dedicated to one of the three assembly lines. The lowest floor holds the build-up stations for major sections, such as the stabilisers and nacelles.
13 Mar 2015 - New Panel Assembly Line introduced for building wing panels to reduce 737 assembly time.
SEATTLE, March 13 (Reuters) - Boeing Co has started using a new automated system to build wing panels for 737 jetliners, an important step in preparing to hit record production speeds while introducing new models of the popular plane. The robotic system, known as the Panel Assembly Line, or PAL, this week drilled holes and installed rivets for the wings of a production aircraft, the first such use of the system since installation began last summer, Boeing officials told Reuters during a visit to the Renton, Washington, plant. PAL replaces older-generation machines that drilled the panels, but left workers the task of installing rivets, a laborious process that led to occasional injuries and defects. PAL is designed to cut injuries in half, slash defects by 66 percent and reduce production "flow" time by 33 percent - all on half of the factory footprint. Its start-up was widely awaited because the 737 factory accounts for two-thirds of the planes Boeing makes and PAL will help enable the company to boost production. Inside the factory, a 60-ton, blue machine, looking something like a futuristic car wash, glides silently on hidden rails over a wing panel held in a jig. With a quiet "hiss" the machine zips holes into the metal wing panel and installs rivets, connecting pieces known as stringers to what will become the bottom surface of a wing. Five machines, made outside Seattle by Electroimpact Inc, have been erected in the plant. Boeing will install eight in total, with a ninth as a spare. They replace older machines made by Gemcor, based in West Seneca, New York. Boeing's two assembly lines in Renton make 42 of its 737 jetliners a month in competition with the Airbus A320. Boeing plans to increase that to 47 and then 52 a month by 2018. This summer it will open a third line that will start making the newest version of the plane, the 737 MAX. Boeing plans to start building the first MAX in August and finish in November. Boeing has not publicly confirmed the production schedule for the 737 MAX. The fuel-saving model will enter service in 2017. When the third line is running, Boeing could in theory produce 63 of the single-aisle planes a month, 21 from each line. Industry sources have said Boeing is gauging the ability of suppliers to handle 58 planes a month. Boeing declined to comment on any plans beyond its announced target of 52.
11 July 2014 - Boeing studying impact of 737 fuselage derailment
A freak transport error threatens to derail Boeing 737 production temporarily, raising questions once more about supply chain vulnerabilities as commercial aircraft production rates climb ever higher. Boeing was still evaluating as this article went to press the impact of a train derailment in Montana on 3 July that dislodged six 737 fuselages en route to final assembly in Renton, Washington, from the Spirit AeroSystems factory in Wichita, Kansas. Montana Rail Link, the railroad company involved in the derailment, had recovered three fuselages that had slipped down a steep embankment into the churning Clark Fork River. Pictures from the scene showed the three fuselages had sustained severe damage. Boeing was still assessing the extent of the damage and how it will impact a production system that rolls-out six completed 737s every three working days at current rates. It is a system designed to accommodate a minimum of disruption from a globally scattered supply chain, with parts flowing into Renton by air, sea and rail. Spirit, which Boeing divested in 2005, builds 70% of the 737 – the forward and aft body, nose section, nacelles, pylons, vertical fin, horizontal stabiliser, flaps and wing-to-body fairing – at its sprawling production facility in Wichita. Spirit ships the complete fuselages – lacking wings, landing gear and most systems – by train to Renton. The freight cars pass through Kansas City, Nebraska, Wyoming, a journey of nearly 2,000nm (3,700km) through mostly remote plains and wilderness. The latest derailment is the most significant disruption in modern memory. In 2011, a tornado dislodged two 737 fuselages from a train passing through Nebraska. The following year, damage caused by another tornado closed Spirit’s factory in Wichita for a week. Somehow, the storm ripped off a section of the factory’s roof, but did not cause any damage to the fuselage structures lying below. Spirit took several weeks to fully recover, but never missed a “load date” for a 737 fuselage in Renton. The latest incident again highlights Boeing’s heavy reliance on Spirit for a 737 product line in a market segment with unprecedented demand. Boeing plans to raise 737 output again to 47 aircraft per month in 2017, a 12% jump from the current rate of 42 every month. At current production levels, two assembly lines in Renton each complete one 737 roughly every working day. Boeing is opening a third line in 2015 in the same factory to build the 737 Max, creating capacity to more than 60 aircraft per year.
The fuselages were crushed and baled a few weeks later. A local scrap metal company brought out a portable baler it uses to crush cars, and turned the six 737 bodies into large metal cubes.
07 Feb 2014 - Boeing raise 737 production to 42 aircraft a month
Boeing starts to lift 737 production to 42 monthly Wednesday, but don’t expect a lot of new jobs. The monthly increase from 38 to 42 of Boeing’s best-selling aircraft will add only “several hundred” more jobs to the Renton site, Beverly Wyse, vice president and general manager of the 737 program, said this week. The first wing spars were to be loaded into production Feb. 5, for the first 737 at the 42-per-month rate. About 11,800 people work at the Renton site, according to a Boeing spokeswoman, so the increase is just over 2 percent. But the production rate increase will increase pressure on the supply chain, and Wyse said her team is increasing its oversight to make sure that suppliers can keep up with the pace. “We have them come in and walk us through staffing, training plans,” she said during a morning briefing Feb. 4 with journalists in Renton. “If we see any instability there, we work closely with them, very intensively, to make sure they come back on plan.” She added that this scrutiny is driving further down in the supply chain, into suppliers’ suppliers. “We’re stepping down and getting more focused on process, how do they manage sub-tiers,” she said. Wyse expressed confidence in the 737 program, pointing out that the 3,680-plane backlog of the not-yet-airborne 737 Max aircraft and the current 737 “next generation” aircraft will keep the assembly lines running for seven years even without new orders. “Even with this next generation, we’re continuing to see more demand than we have positions for, all the way out to 2020,” she said. “Is there a bubble? We’re certainly not seeing one in the single-aisle market; as far out as we can see, we see more demand than there is production capability.” Here she was referring to the question of whether airlines are overordering, creating a bubble in the global aircraft order book, a topic that was the subject of one panel at the Pacific Northwest Aerospace Alliance annual convention in Lynnwood this week. Confidence in further growth is so strong at Renton that Wyse is leading the conversion of the site to lift production again, to 47 monthly in 2017, and possibly to 52 after that. To do this, Boeing continues to “lean out” the 737 line, which means removing waste that slows production. In October, Boeing for the first time cut production time for each 737 to 10 days from 11, said Erik Nelson, deputy operations leader for the 737 program. This is less than half the time it took to assemble each Boeing 737 in 1999, before Boeing instituted moving lines on the 737 floor. The task facing Wyse and her team is complicated by the fact that Boeing also is creating a third production line at the Renton site to start production of the 737 Max, while it’s simultaneously pushing the other two production lines to 42. To do this, workers are moving around critical production areas in a giant game of musical chairs, making room for the third production line. This week, plastic covered recently poured concrete in one part of the largest assembly area, where wings once were prepared for installation but that will be transformed to a central area for preparing fuselages for the next production steps. Currently, three fuselages at once can be prepared, but that will be increased to nine simultaneously, said Nelson, suggesting that this would be sufficient even to get to more than 47 aircraft monthly. Meanwhile, the company is moving out a thicket of parts storage and preparation areas, next to the current No. 1 production line, to create space for the new third production line, Nelson said. That clearing is to be done by the end of 2014, with concrete poured in time to start production of the re-engined 737 Max in 2015. One thing that’s striking is that despite the pressure to increase rates, workers on the factory floor seem relaxed, and there are no visible signs of haste. Nelson said this is a result of improving rates by removing waste — the basic tenet of lean — rather than making people work faster. “One of our goals is to have stability in the system,” he said. “We want to make sure people are deliberate in the work.”
01 Nov 2013 - Boeing to raise 737 production to 47/month by 2017
Boeing will boost 737 production to 47 aircraft per month in 2017, the latest build-rate increase the manufacturer has announced on its narrowbody line.
Boeing began producing 38 737NGs per month early this year and the rate is expected to rise to 42 per month in the first half of next year. By 2017, when the company is scheduled to deliver its first re-engined 737 MAX aircraft, the 737 program “will build more than 560 airplanes per year and will have increased output by nearly 50% since 2010,” the manufacturer said.
Boeing VP and GM-737 program Beverly Wyse said, “Our employees and our suppliers have successfully increased the production rate to unmatched levels over the last three years. This increase will lay a solid foundation as we bridge into production on the 737 MAX.”
Boeing currently has more than 3,400 unfilled orders across the 737 family, including more than 1,600 orders for the 737 MAX.
Boeing Co said it would increase production of its workhorse 737 aircraft to 47 planes per month by 2017 from 38 now, a surprise move that analysts said boded well for the company, its suppliers and airlines.
Boeing had already announced plans to increase production to 42 per month in the first half of 2014, matching current output by rival Airbus SA of its competing A320 jet family.
With the new target, Boeing would enter territory that Airbus isn't attempting. The output, from the same footprint at Boeing's 737 factory in Renton, Washington, will not only boost Boeing's cash pile, it will give the company more delivery slots to sell to airlines who want new, fuel-efficient planes sooner.
"This is a big, bold, but very strategic move by Boeing," that follows recent competitive wins by Airbus that likely have been "more heavily price-driven than in the past," said Russell Solomon, an analyst at Moody's Investors Service in New York.
He said Boeing can also be aggressive on price and now can talk with customers about new orders "with the very pointed message that they won't have to wait as long to get their greatly desired new equipment if they buy Boeing vs. the other guy."
Because of the high volume and relatively low production costs, the 737 and A320 are often seen as cash cows, and play a big role in funding development of larger and technically more challenging aircraft like the Boeing 787 Dreamliner or the Airbus A350.
Boeing's rate increase was more ambitious than some forecasts. Carter Copeland, analyst at Barclays in New York, said he had penciled in Boeing building 46 737s a month around 2018. "I definitely didn't expect an announcement on it so soon," he said.
While Copeland said he didn't have major concerns about the 737 supply chain keeping up with higher rates, he said producing so many of the current 737s and the 737 MAX "would seem somewhat challenging on the surface."
He added, "I'm sure the supply chain is quite pleased as the 737 is a profit leader for essentially everyone who's on it."
Boeing Commercial Airplanes Vice President Beverly Wyse said in a statement that the higher rate would "lay a solid foundation as we bridge into production on the 737 MAX."
The company has 3,400 orders for 737 aircraft, including about 1,500 next-generation MAX models.
The 737 MAX will have new engines and other changes to make it about 14 percent more fuel efficient than current models.
Boeing said the first delivery of the 737 MAX is on track for the third quarter of 2017.
In contrast to the Boeing target, the chief executive of Airbus this week reiterated plans to hold its production rate of competing A320-family aircraft steady at 42 per month, saying the European company had some concerns about the fragility of the supply chain.
Rob Stallard, an analyst at RBC Capital Markets, said Boeing's move "might give Airbus reason to accelerate" its production beyond the 42 a month.
Airbus' output for narrow-body jets is based on an 11.5-month production calendar, implying average capacity for 483 aircraft like the single-aisle A320 a year.
Boeing is based on a 12 month production schedule, though the company traditionally closes for the week between Christmas and New Year.
Stallard said the new Boeing target was "incrementally positive" because speculation about rate increases in the latter half of the decade may had have "fully baked in the ramp, and suggests that the current up-cycle continues to have legs."
He added that any rate ramp carries risk.
Airbus and Boeing both see demand for over $2 trillion worth of such aircraft over the next 20 years.
01 Aug 2013 - Boeing considering raising 737 production rate above 42 aircraft per month
Boeing president and CEO Jim McNerney said he sees “a clear path” to raising 737 production rates above 42 airplanes a month as 737 Max 8s begin to supplant current-generation airplanes on its assembly lines in Renton, Washington, and its share of the market for its re-engined narrowbodies reaches equilibrium with that for Airbus’s A320neo.
Speaking during his company’s second-quarter earnings call last Wednesday, McNerney wouldn’t concede any need to price the Max more aggressively to gain a 50-percent market share, despite the fact that the A320neo has outsold the Boeing product by some 800 aircraft.
“They introduced the Neo about a year-and-a-half before we did,” said McNerney. “I think if you look at relative orders along a similar point in time you’d see that we’re at or slightly ahead of where they were as we penetrate our customer base…I fully anticipate about a fifty-fifty [percent distribution] when it all sorts out, when we’re at equal points in customer penetration [and] when we’re both fully ramped up to rates that we targeted.”
Boeing plans to reach a monthly rate of 42 by next year’s second quarter. Airbus reached that plateau during last year’s fourth quarter, but it has announced no plans for further increases.
Notwithstanding suggestions that Boeing and Airbus have already created a market “bubble” with their aggressive rate hikes, McNerney cited potential “pressure” for further increases assuming the world economy holds form and other “variants” remain in place. He also said he sees no particular internal barriers at Boeing to meeting that demand. “Rate breaks are never easy, but we see a clear path to execution there and we’re assessing the scenarios right now of how and where we would do that,” added McNerney.
Whatever it decides, Boeing won’t risk disrupting the introduction of the Max, schedules for which now call for entry into service in the third quarter of 2017, as much as six months earlier than originally planned. Last week Boeing announced that it completed firm configuration of the 737 Max 8, marking the start of the detailed design phase. Boeing expects to start final assembly of the 737 Max 8 by the end of 2015.
31 Jan 2013 - Boeing ramps up 737 production to 38 airplanes per month
RENTON, Wash., 31 Jan. 2013. Boeing (NYSE:BA) workers are now assembling Next-Generation 737 at a rate of 38 airplanes per month in its Renton, Wash., facility. Boeing has grown production of the 737 by more than 20 percent, from 31.5 to 38 airplanes a month, over the past two years. Boeing’s executive leadership anticipates another increase in 2014, to a rate of 42 airplanes a month. "We have more hard work ahead of us, but we are well on our way to another successful production rate increase," says Beverly Wyse, vice president and general manager of the 737 program. Employee teams have been instrumental in reducing 737 production flow by developing and implementing innovative efficiency improvements, says a spokesperson. The first Next-Generation 737 built at the new rate is scheduled to be delivered in the second quarter of this year.
14 Jul 2011 - Boeing considering production rate of 60 aircraft a month
Boeing is once again contemplating increasing the production of its Renton 737 airliner production lines, its commercial airplanes chief executive says. Jon Ostrower, writing on FlightGlobal.com, says Boeing Commercial Airplanes CEO Jim Albaugh has asked Boeing production executives to gather information about what changes would be necessary at the plant and among suppliers to raise production to 60 737s a month. That's nearly twice the present 31.5 planes a month the plant makes now. Boeing has already scheduled several stepped rate increases to take that production to 42 monthly by 2014. Boeing's two existing production lines in Renton are capable of producing 21 planes a month each when suppliers are able to furnish parts and subassemblies at that rate. The plant has a third 737 production line that is now dedicated to building militarized versions of the 737 for the U.S. and foreign navies. Those planes are equipped with sensors and weaponry to hunt submarines. That third assembly line could theoretically be equipped to also produce commercial airliners. Albaugh told the National Aeronautic Association in a speech this week that if the company can figure out how to build that many planes a month, Boeing could sell them. Albaugh is fresh from a meeting with American Airlines which may order up to 250 single-aisle jets from either Boeing or Airbus. American has been a Boeing-only customer in recent years. At present production rates, the company, however, is sold out through 2016 for the 737. Boeing wants to offer big customers such as American earlier delivery slots to win their business. Read more: http://blog.thenewstribune.com/business/2011/07/14/another-boeing-737-assembly-rate-increase-in-the-works/#ixzz1S9ZWfAxJ
Boeing says it will build 500 737NGs annually, beginning in 2014, in a strong endorsement of the strength of its supply chain and airlines to withstand the threat of high fuel prices and economic uncertainty in Europe and the U.S.
The new rate, 42 per month, is the fourth boost in the past two years and will be absorbed by the second final assembly line at Boeing’s Renton facility, south of Seattle. The company’s 737 backlog is more than 2,100 aircraft.
Line One is already carrying its share of that rate at 21 per month, so the second line will absorb the increase from its current 10.5.
For several years, Boeing has been concerned that frustration over long lead times would drive its customers to other products unless it boosts production rates. That concern is not aimed just at Airbus—Bombardier in Canada, Comac in China and Irkut in Russia are developing 737 competitors.
Meanwhile, legacy airlines have learned to manage their way through economies that continue to remain weak so well that order rates for 737s remain strong.
The improvement package includes cabin upgrades of larger baggage bins and better lighting. The combination has helped sustain demand, says 737 General Manager and Boeing VP Beverly Wyse. Sixty-four customers have ordered the upgrades, she says.
Renton went to a 31.5-per-month rate in 2009, or not quite 1.5 airplanes per day, given an average 22 work days per month. The rate is expected to reach 35 per month early next year, 38 per month in the second quarter of 2013 and the 42 rate in the first half of 2014. The 31.5 rate is a record pace, so each increase sets a new standard for Boeing’s commercial production.
Overall, Boeing is boosting total airplane production 40% by 2013, the other big jump coming on its 777 widebody line.
Airbus previously announced a shift to 42 per month. Boeing officials say the Airbus figure was about the equivalent of 38 per month because the Europeans are factoring in that factories are closed in August.
Boeing does not build the 737 fuselage—Spirit AeroSystems does in a factory previously owned by Boeing in Wichita. The 42 rate has been under discussion for months. The big concern was not whether Boeing’s own workers and factories could keep up the pace, but whether the supply chain could do so. “We have worked very closely with our supply chain ... to ensure we can increase rate in an efficient and responsible fashion,” says Wyse. “We believe that many of the capital investments and production system changes made for 38 airplanes per month will already position us to build 42.”
The Renton facility dates to World War II but has been so thoroughly modernized over the past decade that it can support 737 production rates as high as 63 aircraft per month, Wyse says.
31 Aug 2010 - Upping 737 output further may be too costly
Chief Financial Officer James Bell said Tuesday that raising production rates for the 737 jetliner to 40 a month from a planned 35 could be too costly to implement. Speaking at an analyst conference in New York, Bell said the manufacturer can lift monthly 737 output to 35 without a "significant amount of capital expense," but such spending would have to increase if the rate were to go higher. Furthermore, there is concern that current market demand may not be sustainable, Bell said. In other areas, profit margins among Boeing's civil aircraft lines are "as close to what we can do," Bell said. However, if 737 rates are lifted, it could provide a margin benefit for other models. Meanwhile, Boeing said last week it would have to delay the first delivery of the 787 to early next year, but Bell said costs associated with the new delay can be absorbed by the company.
18 May 2010 - Boeing to increase 737 production rate to 34 a/c per month
Boeing today announced that it will increase production rates on the Next-Generation 737 program to 34 airplanes per month in early 2012. The planned rate increase is aimed at satisfying continued strong demand for the Next-Generation 737. In addition, the company continues to study further potential 737 rate increases, given continued customer demand. “With over 5,200 sold to date, the Next-Generation 737 is the workhorse in our customers’ fleets around the world,” said Boeing Commercial Airplanes President and CEO Jim Albaugh. “Even through the global economic downturn, our diverse 737 backlog has remained very strong. Increasing the 737 production rate is the right thing to do to meet the growth and fleet replacement needs of our customers.” The current production rate on the 737 program is 31.5 airplanes per month. Suppliers for the 737 program are prepared to support the rate increase. The production rate decision is not expected to have a material impact on 2010 financial results. “The global economy continues to recover this year and we believe that airlines will return to profitability in 2011,” said Randy Tinseth, vice president of Marketing for Boeing Commercial Airplanes. “We believe that there will be an increased demand for airplanes – especially in the market served by the Next-Generation 737 – in 2012 and beyond.” With more than 2,000 unfilled orders from more than 80 customers around the world, the Next-Generation 737 is the newest and most technologically advanced airplane in its class. Airfinance Journal’s investors’ and operators’ poll consistently ranks the Next-Generation 737 as the most preferred airplane in its class due to its wide market base, superior efficiency and lowest operating costs.
12 Dec 2009 - 737 Production Rate to Remain Same
Good news coming this week from a top Boeing Executive on 737 production rates. Boeing is seeing no reason to change how many of the 737 jetliners they build a month. All year, there's been growing speculation and concern Boeing would reduce how many 737's they build because a drop would likely lead to layoffs at Spriit Aerosystems. "There is no change and let me repeat. There is no change in our assessment that we can hold the 737 at its current build rate of about 31 airplanes per month," Boeing CFO James Bell said. No change on 737 rates could be some of the best news Spirit Aerosystems employees have heard in a while. Spirit is Boeing's largest supplier. The single aisle 737 fuselage then by rail sends it to Renton, Washington for assembly. Bell spoke at a Bank of America Merril Lynch conference this week and answered skeptics who've been predicting a 737 rate cut. "Now while I know that some are skeptical about our ability to hold our single aisle rates, there are several factors that support our rationale around this rate assumption." Bell says Boeing was careful not to ramp up 737 rates too high during the up cycle. Instead, he says the company worked with customers to keep rates steady for a longer time. "We had over committments of delivery positions and a large backlog of over 2,000 737's." So he says Boeing has been able to absorb order deferrals and cancellations on the 737 without cutting production. Boeings had 215 deferrals through the third quarter this year, but says, since then, order deferrals are slowing down. Also, Bell says airlines are replacing older less fuel efficient planes with ones to save money. "And that's helped us to be able to maintain those single aisle rates." Spirit Spokeswoman Debbie Gann says this is good news but also says Spirit is still working to control costs because of other production cuts. Now if the 787 successfully flies next week and gets on track, there will be more to celebrate in the new year.
10 Feb 2008 - Boeing considering increased production rate of 737
Boeing may increase production of its popular 737 line of narrowbody airliners, if domestic carriers place orders soon for the planes.
In comments before Cowen & Co.'s Aerospace/Defense conference last week, Boeing Commercial Airplanes CEO Scott Carson said the planemaker has mulled over whether to increase production of Boeing's best-selling line of aircraft. "It feels like there might be enough solid demand to do it, but we're watching very carefully," he said, according to TheStreet.com.
In addition to the question of whether suppliers could keep up with increased production rates, there's also the matter of whether a number of domestic carriers will soon place orders to justify the increase. During a conference call with investors last month, Boeing CEO Jim McNerney said the planemaker has "been in extended discussions with a couple of the major carriers who have not participated in this order cycle. It wouldn't surprise me if a couple of deals with these folks came to fruition in '08."
Industry analysts think big Boeing orders from American and Delta may soon be forthcoming, as those carriers look to replace their fleets of McDonnell-Douglas MD80-family aircraft. American, for one, has said numerous times it wants to replace its aged MD-82s and -83s. The carrier is slowly replacing its 300-plane fleet of MD-80s with new 737-800s, from a previous order. The carrier is slated to receive 23 -800s through 2009.
This week, Carson (right) noted American's MD-80s "are not very efficient with this fuel price," and will need to be replaced sooner or later. If that order comes 'sooner,' it alone could be enough to support increased production.
Less certain are Delta's plans to replace its own MD-88s and -90s. Both types are somewhat newer than American's models, and have more-efficient turbofans. But airline spokesperson Betsy Talton says Delta has no plans for "a significant fleet replacement order anytime soon.
"The strategy is to improve the fleet we have," she added. "Acquisitions will be limited and strategic in nature."
There is a wild card, however -- a possible Delta merger with Northwest Airlines. If such a merger takes place, the combined carrier -- which many believe will be run by Delta -- may move quickly to replace Northwest's ancient DC-9 fleet. The DC-9s are paid for... but at such high fuel prices, the savings from using more efficient aircraft would likely offset the added cost of making lease payments.
If the decision to step up production comes, Boeing could make as many as 40 737s per month, up from its current level of 32 planes, according to industry analyst Scott Hamilton. "They've been looking at it for quite some time," he said. "The question has been whether the supply chain can do that."
Hamilton adds Carson criticized rival Airbus's plans in 2006 to ramp up production of the A320 narrowbody line. "In this hot market, it would be easy to be consumed with the desire to sell anything to people walking through the door who want to buy and push our production system to the point where you could break it," Carson said in September 2006, as reported by ANN. "Itís much harder to say, 'Iím sorry, weíre sold out.'"
Indeed, Boeing was hamstrung by that very problem in the late 1990s... and the resulting flood of Boeing planes in a cooling market, as it fought to compete with Airbus, almost bankrupted the planemaker.
There's also the question of whether Boeing's current five-year backlog on 737 production may be cut back drastically, as airlines seek to cancel orders due to slackening demand... which, depending on who you listen to, may or may not be coming.
27 Nov 2007 - 737 Flaps to be Built in Vietnam
TOKYO (AFP) ó Japan's Mitsubishi Heavy Industries said Tuesday that it aimed to be the world's first manufacturer to open an aircraft-related production plant in Vietnam with a new facility due to open next year.
The production plant, which is due to open in Hanoi in January, will employ up to about 200 people when production picks up assembling flaps for the Boeing 737, a company statement said.
It said the move was in response to growing price competition, praising Vietnam's "diligent labour force, robust economy, stable public security and the presence of overseas transport routes."
Mitsubishi Heavy Industries said it would be "the first manufacturer in the world to locate its aircraft-related production facility in Vietnam."
The Japanese group is looking to shift some of its assembly operations overseas and focus its domestic facilities on high value-added work.
Mitsubishi also manufactures wings for Boeing's next-generation 7E7 Dreamliner jet and is developing what it hopes will be the first passenger jet to be built in Japan.
The announcement coincided with a visit to Japan by Vietnamese President Nguyen Minh Triet, whose country is enjoying rapid economic growth and luring a growing number of Japanese companies to set up production plants there.
Japan is a major market for Boeing, with Japanese carriers buying planes almost exclusively from the US aerospace giant.
28 Apr 2005 - Boeing Looks into Raising 737 Production
By Dan Roberts in New York
Boeing is examining ways to ramp up production of its short-to-medium range 737 aircraft as recent strong demand places strains on manufacturing capacity.
Some analysts believe there is now a 36-month wait for the US manufacturer's single-aisle jet, which has proved popular among budget airlines.
21 Apr 2005 - Boeing may cut back in Wichita
If Boeing Co. doesn't sell its Wichita commercial operation to Onex Corp., the airplane maker will likely reduce its presence there, a Boeing official said this week.
The Wichita site could be divided into fuselage work, strut and nacelle work and support work. The company also could outsource production of smaller parts and explore a sale of its fabrication business.
In short, Boeing would continue its overall strategy of focusing on large-scale systems integration, Morris said.
"We wouldn't be able to continue to invest the money into Wichita to allow it to grow," he said.
And Wichita likely would not receive major portions of future new airplane programs, including any replacement for Boeing's popular 737 or any new plane after the planned 787, Morris said. Boeing Wichita builds the 737 fuselage.
1 Apr 2005 - Asian Composites Manufacturing Selected to Produce Boeing 737 Aileron Components
The Boeing Company and Asian Composites Manufacturing Sdn Bhd (ACM) recently celebrated the selection of the Malaysian company to produce aileron panels and components for the Boeing Next-Generation 737 family of airplanes and the first delivery to Hawker de Havilland this month. During the ceremony, Michael Rufert, managing director, Hawker de Havilland, presented a plaque to Dr. Nazily Noor, general manager, ACM. Nazily, displaying a sample composite aileron panel, then provided information on the components, their importance to ACM's business and ACM's selection for this important work.
Asian Composites Manufacturing Sdn Bhd -- a strategic alliance between Sime Darby Berhad and Naluri Berhad of Malaysia and Boeing and Hexcel Corporation of the United States -- is a world leader in supplying composite materials to the global aerospace industry. Hawker de Havilland, a Boeing subsidiary, headquartered in Port Melbourne, Victoria, Australia, is the integrator for 737 ailerons.
Ailerons are hinged sections on the trailing edge of each wing that are used to help the airplane to bank, allowing the airplane's flight path to curve.. Ailerons typically work in opposition to each other -- the right aileron is deflected in the opposite direction that the left is deflected.
The aileron components are shipped to Hawker de Havilland for incorporation into complete aileron units. Final assembly for the Boeing 737 family is based in Renton , Wash.
"We are delighted to be entrusted with the manufacture of these Boeing Next- Generation 737 aileron components and we look forward to providing the world's airlines with the high quality and reliability that they associate with the 737 family," said Dr. Nazily. "Because of the rapid growth of the global commercial airplane market and the extreme popularity of the 737, this new work will increase our production by about 15 percent."
ACM currently produces advanced composite structures for wings of all Boeing jetliners in production. The ACM facility, located in Bukit Kayu Hitam, commenced production in June 2001 and employs more than 310 skilled Malaysians, along with an all-Malaysian management team.
"The selection of ACM is evidence that the management and production teams have proven their dedication and commitment to excellence," said Dr. Dinesh Keskar, senior vice president, Sales -- Boeing Commercial Airplanes. "This is an excellent example of a growing partnership between Boeing and the Malaysian aviation industry."
2 Mar 2005 - Alcoa has agreed to a multi-year contract with Shanghai Aircraft Manufacturing Factory to provide aluminum parts for the tail section assembly of the Boeing 737, the companies announced Monday.
Alcoa's China Alcoa Global Extruded and End Products business will produce 650,000 pounds of hard alloy aluminum extrusions a year at plants in Lafayette, Ind., and South Korea starting immediately. Alcoa already supplies aluminum sheet and plate and aerospace fasteners to Shanghai Aircraft Manufacturing.
When this first 737-900 enters service with launch customer Alaska Airlines early next year, it will haul up to 177 passengers in a two-class configuration, with the range to go from coast to coast.
"We expect the 737-900 to be very successful," said Steve Ford, Boeing's regional director of product marketing. "When operators begin to see the efficiency this plane brings, the economics will be very compelling."
Boeing has so far landed 45 firm orders for its newest 737, including 10 from Alaska, 15 from Continental, four from KLM and 16 from Korean Air.
The 737-900 is scheduled to roll out of the Renton plant in late July, with first flight near the end of August. After a six-month flight-test program and certification, it should be ready for delivery to Alaska next April.
Begun in November 1997 with the order from Alaska, the 737-900 joins three other smaller siblings in the next-generation family -- the -600, -700 and -800 series.
This is the last offspring, Boeing says.
"We are not expecting any larger family members, and no smaller family members, either," Ford said.
The 737-900 is a stretched version of the 737-800. Boeing added a forward body plug of 62 inches and an aft plug of 42 inches, which increased the overall length by 8 feet 8 inches.
In a two-class configuration, the additional length allows the 737-900 to carry about 15 more passengers than the 737-800. But the increased size and weight mean slightly less range. The 737-900 can fly 2,745 nautical miles, about 200 miles less than the 737-800.
The 737-700 can fly the farthest of the four models -- 3,260 nautical miles.
The maximum seating capacity of the 737-900 is 189, a limit imposed by federal regulation based on the number of exit doors and how quickly passengers can get out in an emergency.
All four next-generation models have the same wingspan.
The -600 series is the shortest of the four, at 102 feet 6 inches. It carries about 110 passengers in a two-class configuration. The 737-900 is 138 feet 2 inches in length.
The 737-900 fuselage, which includes everything but the tail section and the nose radome, is 124 feet 4 inches long. That's 4 feet longer than the Wright brothers' first flight.
It is so long that a secondary railroad track must be used during the short trip through Seattle's downtown railroad tunnel. Boeing discovered last year when it sent a mockup of the 737-900 fuselage on a test run by rail from Wichita to Renton that because of the angle, the fuselage hit the tunnel walls when track No. 1 was used.
That was the only transportation problem encountered on the 2,019-mile journey from Wichita, though Boeing found it had to cut back a wall at its Renton plant by 2 feet where the fuselage is unloaded from the rail car.
The first of the next-generation jets, which can fly higher, farther and with much greater operating economics than the older model 737s, was the 737-700. It rolled out of the Renton factory in December 1996.
Through the end of March, Boeing had firm orders for 1,404 of the next-generation jets, not including the Boeing Business Jet, which is a version of the 737-700. Of those ordered, 451 have been delivered to airlines.
The next-generation 737s compete with the Airbus A320 family, which has proved a formidable rival. The A320 family consists of the A319, a shrunken version of the mother plane, and the A321, which is a stretch.
Airbus has won several significant competitions the past couple of years in which its A320 went head to head with the next-generation 737.
But the Boeing planes are selling fairly well, especially the 737-800, which has 655 orders, and the 737-700, with 600 orders. The 737-600 has so far done poorly in the market, with only 104 orders.
Airbus claims its single-aisle plane is technologically superior, because Boeing based the next generation on a design that is almost 40 years old.
The first 737-100 was built in the mid-1960s. Boeing counters that the next-generation 737 is more advanced than the A320, which entered service in the 1980s.
Richard Aboulafia, senior aerospace analyst at the Teal Group, said the next-generation 737 is a very good airplane.
"I say it's good enough and more successful than generally appreciated," he said. That's especially true of the 737-700 and 737-800, he said, noting that American Airlines recently decided to buy the 737-800, the first time American has chosen Boeing's 737.
He thinks the 737-900 will do well, too.
"That's the ultimate air transport as a commodity," he said. "A large number of people in a jet with few bathrooms. It can't be pleasant, but it sure will be cheap."
Because of the good operating economics, airlines are using their new 737-700s and 737-800s on longer, non-stop routes, including coast to coast. Aloha Airlines, for example, recently began 737-700 service between the Hawaiian Islands and Oakland, Calif.
Some passengers do not like to fly the new 737s on such long routes, arguing it is too uncomfortable for a four- to five-hour flight.
"Is it comfortable? Not really," Aboulafia said. "But comfort is not really an issue on domestic flights. Air transport, domestically, is a commodity. It is no different than taking the train or the bus. It's not something you do to enjoy the food or play billiards. You want to go from point A to point B as cheaply as possible."
Although Boeing plans no more entries in its next-generation family, the company is expected to develop the 737-700X, which would be a superlong-range version that could fly more than 4,000 nautical miles. Boeing sees a possible niche market for the jet on routes between Europe and the East Coast.