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Boeing 'focuses on CFM' as Spirit AeroSystems recovers: CFO

A top Boeing executive has expressed confidence that Spirit AeroSystems will meet the next 737 production increase while reiterating that remaining supply chain problems stem largely from CFM International.

"The recovery right now focuses on CFM. They have a recovery plan in place that takes them to about mid-year, when they are fully recovered," Boeing chief financial officer Greg Smith says on 6 February.

Last year, Boeing struggled to boost 737 production due to a shortage of key components – namely fuselages made by Spirit and Leap engines made by CFM, which is jointly owned by General Electric and Safran Aircraft Engines.

Boeing increased 737 production from 47 to 52 aircraft monthly in 2018 and hopes to hit 57 aircraft monthly this year – assuming suppliers can deliver.

"The resources and time [are] being focused… on getting CFM back to that recovery plan in order to meet" both the current 52-aircraft rate and the planned 57-aircraft rate, Smith says.

CFM's Leap production has increased significantly in recent months. The company delivered 379 of the engines in the fourth quarter of 2018, up from 202 engines the previous year, CFM recently announced.

CFM expects to be "back on schedule by mid-2019," GE CFO Jamie Miller said in recent days.

Boeing's Smith, who made his comments during an investor conference hosted by financial services company Cowen, says Spirit has made notable improvements.

"They are tracking to our production system and meeting the load dates," he says.

Spirit has also conducted a 57-aircraft-monthly "exercise", which "gives us more confidence in their ability", Smith adds.

Spirit's chief executive Thomas Gentile, during an earnings call on 1 February, affirmed his company's plan to reach a 57-aircraft rate "later in" 2019.

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