By Allison Lampert and Dan Catchpole
SEATTLE (Reuters) – Since the conclusion of a debilitating strike at several of Boeing’s U.S. plane factories over a month ago, progress in increasing production of its popular 737 MAX jet has been intentionally slow.
Safety inspectors at the 737 MAX factory near Seattle meticulously examined partially-built planes for any overlooked flaws during the seven-week work stoppage. Other employees diligently reviewed manuals to renew their safety certifications. The factory was initially quiet in mid-November, with one worker leaving early as the bins of fasteners he needed to replenish were not in use, according to an insider.
As a result, no new 737 MAX planes have been finalized. Boeing announced last week that it had resumed MAX production, as initially reported by Reuters.
Boeing’s cautious strategy, in response to past criticisms of rushing production, has been commended by regulators and certain airline executives. However, some smaller suppliers who had reduced staff or operating hours during the strike are hesitant to ramp up operations again, adding to the existing uncertainty in the fragile supply chain, according to three suppliers, an analyst, and an industry source.
Both Boeing and competitor Airbus have encountered challenges in meeting production targets due to delays in the supply chain. Boeing CEO Kelly Ortberg warned analysts in October of potential difficulties in the supply chain post-strike.
One supplier disclosed that parts that previously took a day to complete at a processing shop now require a week. This report on Boeing’s efforts to restart production of its top-selling jet is based on discussions with a dozen Boeing factory workers and ten suppliers, most of whom requested anonymity due to media restrictions.
The accounts highlight Ortberg’s commitment to methodically resuming 737 MAX production, emphasizing safety and quality under heightened regulatory scrutiny following a mid-air incident in January. Some suppliers are still grappling with the aftermath of the strike, compounded by reduced plane production during the COVID-19 pandemic and the 2019 MAX grounding after two fatal accidents involving the model.
“We will continue to gradually increase production as we adhere to our safety and quality plan and strive to meet the expectations of our regulators and customers,” stated Boeing spokesperson Jessica Kowal. “We will also maintain transparent communication with our suppliers, addressing concerns and exploring opportunities for enhanced collaboration to ensure the safety and reliability of our entire production system.”
FAA ON-SITE
Following weeks of inactivity, there were indications of progress within Boeing’s Renton 737 MAX facility last week, according to three sources, as green fuselages moved to the final assembly line for wing and tail attachment.
While the resumption does not immediately alleviate concerns, it is a positive development for fuselage supplier Spirit AeroSystems, which faced storage constraints during the strike. A Reuters journalist observed over 100 MAX fuselages at Spirit’s Wichita plant this week.
Spirit Aero spokesperson Joe Buccino stated that the company is “collaborating closely with Boeing as production restarts.”
Boeing executives have expressed hopes of producing
They were warned that achieving the upper end of the target is unlikely. The spokesperson from Boeing refrained from commenting on these figures. Boeing typically shuts down most of its plane manufacturing operations from December 24 to January 1. While specific production numbers are not disclosed by Boeing, the company mentioned in October that it was aiming to reach a target of 38 737 jets per month by the end of the year before the strike occurred. Workers at the factory diligently carry out daily tasks while focusing on cleanliness and error prevention. FAA officials are seen with clipboards and reflective vests overseeing these efforts. FAA Administrator Mike Whitaker commended Boeing on December 5 for not immediately resuming production after the strike, instead prioritizing workforce and training. However, Whitaker mentioned to Reuters that Boeing still has a long way to go in establishing the desired safety culture. The stabilization of Boeing’s MAX production is crucial for both the company and the financial well-being of its supply chain, with numerous airline orders pending and anticipated revenue for years to come. Some suppliers have expressed uncertainty about bringing back workers before 2025, citing concerns over potential changes in Boeing’s production plans. A few suppliers have been informed by Boeing about an upcoming private update on a significant 737 supply chain production milestone. Supplier confidence in Boeing’s delivery rates is currently low due to past disappointments, according to industry experts. In the short term, Boeing can rely on excess parts accumulated this year to maintain production levels. However, supplier doubts about meeting Boeing’s production targets may hinder necessary investments for future growth. Boeing’s recovery to pre-strike production levels for the 737 MAX is expected to take longer than after a similar work stoppage in 2008. This prolonged recovery period is particularly challenging for small suppliers in Washington state who are cautious about making capital investments. Despite the recent strike, aerospace producers increased orders for manufacturing technology in October, suggesting a push for technology upgrades during the downtime. However, smaller job shops have been more hesitant to invest in new technology.
In the wake of a recent strike, metal aircraft component manufacturers are facing ongoing delays despite efforts to expedite production processes. Hobart Machined Products, a family-owned business operating since 1978, is feeling the impact as they navigate challenges in processing their precision parts.
The couple behind Hobart Machined Products relies on a finishing specialist to anodize and paint their components before delivering them to larger companies, including aerospace giant Boeing. Previously, this finishing process could be completed in a day. However, due to staffing shortages resulting from layoffs during the strike, the timeline has now stretched to a week, adding strain to the company’s operations.
“We are doing our best to stick to our production schedule, perhaps speeding up certain orders and incurring additional costs to ensure timely delivery to our clients,” shared one of the business owners, emphasizing the need to adapt to the current circumstances. Despite the challenges, the couple remains cautious about expanding their workforce until a sense of stability returns to the industry.
Meanwhile, Carmen Evans, co-owner of New Tech Industries located near Boeing’s Everett factory complex in Mukilteo, Washington, is also grappling with uncertainties in the wake of the strike. The small supplier stands ready to ramp up production of specialized tooling for Boeing, a key client. However, the resumption of operations at Boeing’s MAX factory remains a critical factor in their future plans.
As the industry awaits signs of recovery, companies like Hobart Machined Products and New Tech Industries find themselves in a state of limbo, eager to resume full-scale operations but mindful of the challenges that lie ahead. While there is a sense of readiness to meet increased demand, the pace of progress remains tempered by the broader context of ongoing disruptions.
Reflecting on the current situation, Evans noted, “The floodgates have yet to fully open,” underscoring the gradual nature of the industry’s resurgence post-strike. With a mix of optimism and caution, businesses are navigating a delicate balance between meeting existing commitments and preparing for future growth amidst a landscape of uncertainty.
The resilience and adaptability of these manufacturers stand out as they navigate through turbulent times, demonstrating a commitment to serving their customers while also prioritizing the sustainability of their operations. As the industry looks towards recovery, the stories of businesses like Hobart Machined Products and New Tech Industries serve as a testament to the perseverance and determination that define the aerospace manufacturing sector in the face of adversity.
