Boeing Says 737 Ramp Is Slipping On Wing Flow — 'We're Going To Do It Right'
CEO Kelly Ortberg said wings, not engines, are holding up the 737, and Boeing will stay at 47 a month longer before moving to 52.
Boeing CEO Kelly Ortberg said on the company's third-quarter earnings call Tuesday that the 737 ramp is taking longer than expected, blaming wing production and pushing the target of 52 jets a month to the back half of 2027. Boeing stock fell 9.54% to $170.35 in Tuesday trading, as of 11:46 a.m. ET.
Wings, not engines, are the snag
Boeing, which builds jetliners, defense systems and satellites, is trying to stabilize 737 output at 47 a month. Ortberg told a Bernstein analyst that engines "aren't a problem in this equation."
He said the company had planned a series of "flow enablers" to lift wing output from 42 to 47, and that some of them "just flat out did not yield the flow savings." Boeing is adding capacity and new enablers, and early signs are encouraging, he said, but wings are not yet stable enough to support 47.
He said wings are what caused the instability, and that fuselages from Wichita are the next focus. Fuselages are being built slower than final assembly on purpose to burn down inventory, and they must ramp up to sync with a move to 52. Ortberg said the Wichita safety and quality work has slowed that site a little.
Ortberg said final assembly rework has improved 40% since the start of last year. He expects it to take into next year to get fully stable at 47.
Fewer 737s this year, longer gaps between steps
CFO Jay Malave said the delay means 737 deliveries will come in short of the 500 target this year. Boeing delivered 124 737s in the quarter. He said Boeing expects longer intervals between rate steps at higher levels, which he called more in line with its historical performance.
Malave also said Boeing built 737-7 and 737-10 jets before certification and will start delivering them early next year, with about 30 pre-built going into 2027. The FAA certified the 737-7 in July and the 737-10 last week, Ortberg said.
Ortberg framed the pace as a choice: it is more important to do the ramp right than to hit a particular month, he said. "Everybody wants us to go faster. I get that," he said, adding that Boeing will stay disciplined.
Cash targets and the 777-9
Boeing narrowed its 2026 free cash flow outlook to about $2 billion and set targets of about $3 billion in 2027, $6 billion in 2028 and $10 billion in 2029. Ortberg called the 2027 step a one-year shift to the right rather than a change in the endpoint.
Third-quarter revenue was $24.2 billion, up 4%, and free cash flow was positive $464 million. Commercial Airplanes posted an operating margin of negative 6.5% on $10.7 billion in revenue. Backlog stands at a record $745 billion.
On the 777-9, Ortberg said Boeing still needs approval to begin the balance of flight testing, including ETOPS testing.
Ortberg said first 777-9 delivery is still expected in 2027.
Sources
- Boeing (BA) Q3 2026 earnings — CNBC
- Boeing Posts $116 Million Loss as Revenue Rises - WSJ — The Wall Street Journal
- Boeing narrows third-quarter loss as defense sales rise, but focus remains on 737 Max production — CNBC
- Boeing's Q3 revenue, earnings miss estimates amid narrower losses (BA:NYSE) — seekingalpha.com
- Boeing CEO Kelly Ortberg: The uncertainty in our financial performance is narrowing — CNBC
