Boeing to boost 737 production to 52 planes a month

The planes just keep on coming.

Boeing plans to increase production of its popular 737 single-aisle airliner to a record 52 planes a month in 2018, or 620 a year, the company said Thursday.

That’s its highest rate ever.

The production increases are in response to strong demand from customers around the world, it said.

Boeing currently builds 42 737 airplanes a month and had previously announced plans to increase production to 47 a month in 2017.

The news is good for Spirit AeroSystems, which builds the fuselages in Wichita and ships them by rail to Boeing in Renton, Wash.

Boeing’s long-term forecast projects a need for more than 25,000 single-aisle planes worth $2.56 trillion over the next 20 years.

Boeing builds the Next-Generation 737 and is developing a 737 variant called the 737 MAX with new engines.

“The 737 Next-Generation and 737 MAX airplanes offer our customers unparalleled efficiency and reliability,” Ray Conner, Boeing commercial airplanes president and CEO, said in a statement. “Whether for fleet growth or for replacement needs, the 737 enables market success for carriers due to lower operating economics and by providing a better passenger experience.”

The production increase will help relieve tight supply as strong demand and record backlogs keep delivery slots tight, Sterne Agee aerospace analyst Peter Arment wrote in a note Thursday to investors.

“The rate increase demonstrates end-market demand for airplanes more quickly than the current production schedules provide,” Arment wrote. “This is an important dynamic as global growth calls into question the quality of backlogs. As (Boeing’s) most profitable program, a 10 percent increase in rate will be positive for the company’s cashflow outlook.”

This story was originally published October 2, 2014 at 9:37 AM with the headline "Boeing to boost 737 production to 52 planes a month."