Supply chain problems further slow Boeing deliveries | The Seattle Times

2022-03-26 03:44:19 By : Ms. Linda Lin

The pace of Boeing jet deliveries, already slowed by lack of access to the Chinese market, is being hit by supply chain glitches. Some airplanes cannot be completed for want of items as small as a roll of tape.

Boeing said Tuesday it delivered just 22 airplanes last month and won 32 net orders.

The plane manufacturer delivered 20 narrowbody 737 MAXs from its Renton assembly plant in February, including the 50th delivery of a MAX to Ireland’s Ryanair. In addition, Boeing delivered two widebody freighters from its Everett plant: a 747-8F for UPS and a 777F for DHL.

There were no deliveries of the 767 in its military tanker or freighter models, and also none for the 787 passenger jet. Boeing still awaits approval from the Federal Aviation Administration for fixes to a series of manufacturing defects on the 787.

Boeing Chief Financial Officer Brian West said last month on the quarterly earnings call the company is building MAXs at a rate of 27 jets per month. In addition to the newly built jets, it aims each month to clear out batches of the 335 formerly grounded MAXs still parked since the airplane was allowed to return to service.

Yet, despite the expectation that some previously parked jets might be delivered in addition to those being built each month, the rate of deliveries remains much lower than the production rate cited by West.

Many of the grounded MAXs are for China, which has not yet approved the MAX to return to service after its extended grounding following crashes in 2018 and 2019. That clearance is expected soon, subject to approval by the Chinese government amid political tension in U.S.-China relations.

Deliveries to airlines in some other countries are impaired by air travel constraints during the pandemic. And going forward, there will be no deliveries to Russia, and the war in Ukraine will create huge logistical problems impeding long-haul international air travel.

Meanwhile, supply chain problems on the assembly line are slowing completion of the jets currently being built.

Two people familiar with the issue said some MAXs are rolling out of the Renton factory with unfinished cargo bays because of an ongoing shortage of foam insulation tape that is used as a fire suppressant to block smoke entering the passenger cabin in the event of a cargo fire.

Without the tape, mechanics cannot add the final sidewall panels that line the interior of the cargo bay.

Boeing has been scrambling to get more rolls of the tape, the people said.

The fire-protective tape is used in many industries. Logistical restrictions and a shortage of labor during the COVID-19 pandemic have led to a series of such seemingly random supply chain glitches.

Some planes on the Renton assembly line are also being held up by late deliveries of passenger seats.

On the earnings call last month, West, the chief financial officer, said, “As we look to ramp both our production rate and delivery cadence this year, we will continue to monitor the impact of omicron on resource availability.”

At the Dubai Air Show in November, Boeing sales chief Ihssane Mounir told journalists the supply of equipment installed in airplane passenger cabins that is custom-built for specific customers — such as seats and galleys — can be a challenge.

In response to questions about the tape and seat shortages, Boeing sent a statement Monday that did not address these specific issues or the broader supply chain. It said only that the timing of jet deliveries depends upon “customer requirements, logistics and our own process … for delivery.”

Boeing booked gross orders for 32 MAXs in February, including 18 for leading aircraft lessor Air Lease Corp., two for unidentified private jet buyers, and a dozen for unidentified airlines or lessors. It also booked orders for five 777 freighters.

However, an order for one MAX was canceled, and Air Lease Corp. canceled four 787-9s, swapping out those widebodies that cannot be delivered for the extra MAXs it ordered.

Boeing’s order backlog was further supplemented by a net total of 49 airplanes restored to the order book after previously being removed because lack of financing or contract terms made delivery unlikely.

A net total of 45 MAXs and four 787s were restored to the backlog last month.

Boeing’s official order backlog now stands at 4,375 airplane orders, including unfilled orders for 3,461 MAXs.

In the first two months of the year, Boeing has won net new orders for 107 airplanes.

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