Feb. 10, 2020, © Leeham News: The was plenty of angst among suppliers last week at the annual Pacific Northwest Aerospace Alliance conference.
Worries about the production shutdown, its duration and lack of communication from Boeing prevailed.
But there were in fact rays of sunshine beginning to break through the dark clouds of the last year.
Some suppliers—not many—reported that they’ve been told to begin shipping parts and components as early as March 1.
This gives hope that production will resume in April.
To be sure, the good news is mixed with a lot of bad news for suppliers. Some laid off workers and more layoffs are yet to come.
LNA was the first to reveal two weeks ago that Boeing’s hope is to resume production in April, initially at the rate of 5/mo.
It won’t be until late 2022 that Spirit Aerosystems, which produces the 737 fuselage, is back to rate 52. This is the pre-grounding rate.
Going to rate 57 won’t happen until 2023, four years later than planned.
These timelines will put pressure on a large number of the ~650 suppliers within the 737 system.
Boeing says anticipated recertification is for mid-year and production will resume a couple of month earlier.
But skeptics at the PNAA conference have seen the recertification move before. The movie, however, seems caught in an endless loop.
Several suppliers said they will believe it when fuselages from Spirit are loaded on the trains in Wichita for shipment to Renton.
There is a long, long way to go, especially for the small- and medium-sized suppliers, before there is a return to normalcy.
It will be two years before the MAX production rate returns to the pre-grounding rate of 52/mo. Spirit Aerosystems says it won’t be back to this rate before the end of 2022.
Boeing planned to move to rate 57 by the end of 2019. This new rate won’t happen until 2023.
Suppliers who were ready to move to rate 57 in many case spent money to prepare. This adds to the cash squeeze experienced by the rate reduction from 52 to 42 in April and then the shut down in December.
I received the settlement documents late last week for the Uk Serious Fraud Office and US Justice Department investigations into the Airbus bribery scandal.
The SFO document is here: SFO v Airbus – Statement of Facts 2020_01_30 (1)
The Justice Department document is here: US DOJ Statement of Facts on Airbus Bribery 2020_01_31 (1)