By Scott Hamilton

Boeing CEO Kelly Ortberg. Credit: Getty Images.

July 30, 2025, © Leeham News: Boeing CEO Kelly Ortberg began to walk back just a bit about the timeline to ramp up production of the 737 MAX during the 2Q2025/1H2025 earnings call.

It’s the first time that LNA has seen a little equivocation.

In previous interviews and earnings calls, Ortberg said that once the Federal Aviation Administration (FAA) approves, Boeing would ramp up production of the 737 MAX every six months in increments of five.

For example, Boeing is currently producing the MAX at a rate of 38/mo (although July may fall short, according to tracking by Planespotters). The next rate, subject to FAA approval, is 42/mo (yes, this is only four, not five, but this is the figure Boeing has said). After that, Ortberg has said repeatedly that rate breaks in increments of five would be every six months. LNA was skeptical from the start.

Jamie Baker and Mark Streeter, the airline analysts for JP Morgan, came up with an apt term when discussing the Southwest Airlines guidance that applies equally here: “Very Aggressive and Seemingly Unobtainable (or VASU for short).”

In response to questions from an analyst, Ortberg began walking back on the 2Q earnings call yesterday.

“No earlier than six months”

“We said rate increases beyond that will go in increments of five, no earlier than six months,” Ortberg said. “That doesn’t mean it’s on six months. It’s no earlier than six months. We’ll continue to do what we’re doing right now. As we go to the new rate, [we’ll] ensure we’re stable and can prove that the production system has the right metrics before we go request an increase in rate. And if they aren’t, then we’ll stay at that rate until we get the stability to where we want it. But we’ve kind of said no earlier than six-month increments, and they’ll be in five per month steps.”

Later, Doug Harned, the analyst from Bernstein Institutional Services, got right to the point:

“On the rate increases that you were talking about before, you’ve had this goal in the future rate increases to 47 and 52 on the MAX, at six-month intervals. I appreciate that you’ll see how that goes and make a call if it needs to be longer. But that seems like a very ambitious target, given Boeing hasn’t really done that in the past, it’s been more nine to 12-month type intervals.

“What has given you the confidence that you can move to those levels potentially?”

Working the supply chain

Ortberg responded that Boeing has a lot of inventory from the supply chain built up from advanced purchases.

“We’ve got a tremendous amount of inventory in place,” Ortberg said. “I think in the near-term, as we ramp the MAX, the supply chain is not going to be a challenge for us because of the inventory levels. As we get to those higher rates that you talk about, we’ll be getting more to a balanced inventory level and ensuring that the supply chain can achieve those rates is work yet for us to do with the supply chain.”

Ortberg said that Boeing generally has the supply chain at a higher rate than it is at. “We’ll be able to see where those supply chain constraints are in advance. This is one of these processes where the constraints tomorrow get resolved. [When] there’s new constraints, you just constantly are working each one of those down because we’re in a perpetual rate increase kind of environment.”

Adding Everett to MAX production

The Renton 737 factory can produce 63 planes a month across three lines. But following the MAX crisis and FAA oversight, observers with knowledge of the situation tell LNA that returning this facility to its potential capacity is unlikely. These people predict Renton will cap out at about 52 737s a month.

Boeing is establishing a fourth MAX line at its Everett (WA) widebody plant. This is the first time a single-aisle airplane will be assembled at Everett. The line will be dedicated to the MAX 10, the 230-passenger model that is slightly smaller than the rival Airbus A321neo (at 240 passengers maximum capacity).

LNA is told that this line, called the North Line, will likely cap out at 10-15 MAX 10s a month.

“The 737-10 variant has the most change from all the other variants,” Ortberg responded to Harned. “It will naturally flow through the factory at a slower pace. By isolating or providing that fourth line in Everett, it will allow us to let the three lines in Renton flow faster. That is a big change from what we’ve done in the past, having that many lines flowing. That’s one of the areas that gives us additional confidence. We’ve invested in the capacity.”