Boeing holds 737 production rates steady as deferrals fall

Washington DC
This story is sourced from Flight International
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Boeing has seen a declining number of delivery deferrals for its airliners, providing a positive guidepost for riding out the recession and maintaining 737 production at current levels.

Chief executive James McNerney says the company's Commercial Airplanes arm suffered 271 deferrals last year. While 52% of these were in the second half of the year, McNerney says that the request to delay deliveries dropped from 84 in the third quarter to 57 in the fourth quarter.

 boeing 737
 Boeing 737

The company announced in 2009 that it plans to cut 777 production from seven to five aircraft a month starting in June, and will delay planned increases on the 747 and 767 lines.

Boeing delivered 372 737 narrowbodies in 2009 while maintaining a production rate of 31 aircraft a month. McNerney attributes the steady course to sound management of its backlog. "We believe the discipline we have exercised in managing both production rates and market opportunity has paid off. We foresee holding to our production plans without having to enter into bad business deals for the company," he says.

Boeing says it remains sold out on 2010 delivery slots and is overbooked for 2011.

McNerney says that in managing the backlog, customers have moved up to fill available delivery slots, while "by and large" the deferring customers "have not come and reordered".