Boeing falls after some deliveries paused over parts issue

Paris: Boeing is pausing deliveries of some 737 Max jets after learning of a manufacturing issue that doesn’t affect the safety of planes in the air, the company said Thursday.

The planemaker said it was formally notified of the issue a day earlier by Spirit AeroSystems Holdings, which assembles most of the 737’s aluminum frame. The problem involves two of the eight fittings that attach the jet’s vertical tail to the rear end of its fuselage and affects a portion of the 737 jets built since 2019.

The problem will likely impact a significant number of undelivered aircraft as well as those stored at Boeing, according to the company. Boeing said it expects deliveries to decline in the near-term as it inspects affected aircraft.

Boeing stock tumbled as much as 4.7 per cent in late trading, after rising 0.6 per cent to $213.59 at the close in New York. Spirit AeroSystems dropped more than 8 per cent.

Setback for Boeing

The disruption is a setback for Boeing just as it was regaining its footing following years of turmoil caused by the pandemic and a global grounding of the Max. The planemaker had been briefing customers on plans to increase production rates of the Max, Bloomberg reported last week. Days later, Boeing reported a surge in quarterly deliveries that outpaced rival Airbus for the first time in about five years.

It’s too soon to tell if the quality flaw will affect Boeing’s plans to speed up 737 production. The planemaker is working to learn the extent of the problem and what’s required to address it, according to the company.

The issue involves Boeing’s best-selling 737 Max 8, Max 7, a high-density version, along with a militarized 737 known as the P-8. Not every jet is affected. Spirit AeroSystems and Boeing said they have identified the production numbers of the planes with the problematic fittings.

“We have processes in place to address these of types of production issues upon identification, which we are following,” Spirit said in a statement. “Spirit is working to develop an inspection and repair for the affected fuselages.”

The inspections will take place in an accessible area of the structure. That means any rework is likely to be far less disruptive than Boeing’s repairs to address structural imperfections with the 787 Dreamliner, the company said. Deliveries of those planes were halted for more than a year, starting in mid-2021, over tiny manufacturing flaws in the jet’s carbon-composite frame. In some instances they could only be reached by ripping out aircraft cabins.

Boeing temporarily paused Dreamliner deliveries again earlier this year after learning of a documentation issue with a fuselage component. Analysts expect Boeing officials to provide updates on the company’s efforts to stabilize 737 and 787 production at its April 18 annual meeting and first-quarter earnings report on April 26.