Boeing warns 737 MAX production and deliveries will drop due to parts problem

Boeing 737 MAX aircraft are parked at the company’s production facility on November 18, 2020 in Renton, Washington.

David Ryder | Getty Images

Boeing warned Thursday that it will likely have to reduce shipments of its 737 Max because of a problem with a part made by Spirit AeroSystems.

Boeing said its supplier told the company that a “non-standard” manufacturing process was used in two assemblies in the rear fuselage. It said the problem affects the 737 Max 8, the company’s most popular model, with customers including American Airlines and Southwest Airlines. It also affects the 737 Max 7, 737 8200 and P-8 aircraft.

Boeing said the problem is not “an immediate flight safety issue and the fleet in service can continue to operate safely.”

The manufacturer said in a statement that the problem will likely affect a large number of 737 MAX aircraft that have not been delivered either in production or in storage.

The problem, the latest in a series of production issues, is plaguing Boeing as it strives to ramp up production and deliveries of its best-selling jet while customers wait for new planes to take advantage of the upturn in travel.

Boeing shares fell 4 percent in after-hours trading on Thursday after it disclosed the problem. Shares of Spirit AeroSystems fell nearly 8%.

Spirit manufactured some of the airframes used in Boeing’s planes and said in a statement that it had notified Boeing of a “quality problem” with some 737 models.

“Spirit is developing an inspection and repair of the affected fuselage,” the company said. “We continue to coordinate closely with our customers to resolve this issue and minimize impacts while maintaining our focus on safety.”

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The company said Boeing has notified the Federal Aviation Administration of the problem and is working to inspect and remediate the fuselage as needed.

“We expect 737 MAX deliveries to decrease in the near term while this required work is completed,” Boeing said in a statement. “We regret the impact of this issue on the affected customers and are communicating with them regarding the delivery schedule.” “We will provide additional information in the coming days and weeks as we better understand the effects of delivery.”

The FAA did not immediately respond to a request for comment.

It is the latest production problem for Boeing and its customers. Boeing earlier this year paused deliveries of its 787 Dreamliners for several weeks to address a data analysis flaw, and in 2021 and 2022 it suffered other production defects on its wide-body jets that halted deliveries for several months.

On Tuesday, the company announced deliveries of 64 aircraft in March, the highest number since December, amid an industry-wide shortage of new aircraft.

Airline executives have cited supply constraints on aircraft as among the main challenges in ramping up flying ahead of the peak travel season.

“We are aware of the issue and are working with Boeing to understand how it may affect our Max shipments,” an American Airlines spokesperson said in a statement.

— CNBC’s Leslie Joseph and Phil LeBeau contributed to this report.

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