Boeing starts deliveries of reworked 737 jets, flags cash flow goal pressure

Boeing starts deliveries of reworked 737 jets, flags cash flow goal pressure

Boeing Co has started delivering reworked 737 jets to customers after a manufacturing snafu forced a brief halt but the top end of its full-year free cash flow forecast was a “bit pressured”, its finance chief said on Thursday. The resumption should help achieve the goal of 400-450 deliveries of the jet this year, a target closely watched by investors as the planemaker looks to recover from successive crises caused by two fatal crashes and the COVID-19 pandemic.

“We still expect the first half of the year to be about 30 per month and the back half of about 40 per month,” CFO Brian West said, referring to deliveries, at a conference organized by Wolfe Research.The planemaker was forced to halt deliveries of some 737s earlier this year due to improperly installed brackets — which connect the vertical tail with the fuselage made by Spirit AeroSystems.

Some analysts had expected the halt to delay Boeing’s plans for a 737 MAX production ramp up to 38 per month from 31 currently.But West reiterated that Boeing expects to hit that target this year.”I don’t know exactly when, but that is in our game plan,” he added.

Meanwhile, West said the top end of Boeing’s $3 billion to $5 billion free cash flow forecast was a “bit pressured,” in part due to supply-chain problems at its ailing defense business but the planemaker maintained that goal. Boeing’s shares were up about 1% after briefly turning negative on Thursday. 

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