FAA raises Boeing 737 Max production cap to 42 a month

Boeing’s received regulatory approval to increase production of the best-selling 737 Max jetliner to 42 per month; It was a turning point for the manufacturer, nearly two years after the Federal Aviation Administration limited its production in near-catastrophic weather.

In January 2024, the FAA restricted Boeing from producing planes at a rate of no more than 38 per month after a nearly new 737 Max 9’s door plug exploded — though it was below that level at the time. Alaska Airlines Flight climbing from Portland, Oregon.

According to a National Transportation Safety Board report, Boeing failed to reinstall the key bolts on the door plug before leaving the factory. The 737 Max turned around and landed safely, but it sent the company back into crisis mode just as leaders were expecting a year of recovery.

The FAA said Friday it would still inspect Boeing’s production. “FAA safety inspectors conducted extensive inspections of Boeing’s production lines to ensure this small production rate increase was done safely,” the agency said in a statement. he said.

Boeing said it would work with its suppliers to increase production.

“We appreciate the work of our team, our suppliers, and the FAA to ensure we are ready to ramp up production while keeping safety and quality at the forefront,” Boeing said in a statement Friday. he said.

The increase in production is key to the company’s recovery after years of problems; because airlines and other customers pay a large portion of the price for the planes they buy. CEO Kelly Ortberg, who was chosen last year to stabilize the largest U.S. manufacturer, said last month that he expects to soon receive FAA approval to increase production to 42, with other increases planned down the road.

“We’ll go up 42, then we’ll go up another five spots, then we’ll go up another five spots,” Ortberg said at a Morgan Stanley investor conference in September. “We will probably get to a production rate of 47 per month, to the point where inventory is more balanced with the supply chain.”

The change reflects the FAA’s softening tone and increased confidence in Boeing after years of restrictions. Last month, the agency said it would allow some of Boeing’s planes to be re-signed before being delivered to customers, rather than having the responsibility fall solely on the FAA.

The Max program was disrupted following two plane crashes in 2018 and 2019 that killed all 346 people on the two flights. The plane had been grounded for nearly two years. Covid has also hurt production, followed by supply chain problems and a worker strike at Boeing’s main Seattle-area factories last year.

Boeing has not reported an annual profit since 2018. But it has increased production and new aircraft deliveries are on track to reach the highest rate since that year.

Boeing is scheduled to report quarterly results on October 29.

— CNBC’s Phil LeBeau And Meghan Reeder contributed to this report.