With deliveries of its best seller planes, the 737 MAX jets, picking up during the quarter, United States based plane maker Boeing Co reported its first quarterly profits in almost two years, as global travel has started to see a revamp form the near collapse during the pandemic with a steady pace of Covid-19 vaccine rollouts across the world.
With the plane maker trying to make up for the billions of dollars in lost sales from the pandemic, the 737 MAX is integral to the financial recovery of the company. Boeing is also looking to push past the safety scandal that rocked the company following two fatal crashes involving the 737 Max planes while also trying to address structural defects of its bigger, more profitable 787 planes.
The results pushed the company’s shares by 3.8 per cent.
The plans of the company include keeping the number of employees steady at around 140,000 employees, after it had previously set a target of reducing the number of employees to about 130,000 by the end of the current year, said Boeing’s Chief Executive Officer David Calhoun.
“While our commercial market environment is improving, we’re closely monitoring COVID-19 case rates, vaccine distribution and global trade as key indicators for our industry’s stability,” Calhoun said in remarks accompanying results.
The faster than expected rebound of domestic travel in the United S6tates was hailed by Calhoun. However he also noted that its sale revenues were also stunted by the continued grounding of the 737 Max planes in China along with continued tensions between Beijing and Washington.
The company is also facing stricter regulatory scrutiny and weak demand for its delayed 777X mini-jumbo.
And in order to fix the production elated defects on its 787 program, Boeing is also expending a lot in repairs and forensic inspections of the planes.
Its plans for cutting down the production of the 787s to an unspecified number lower than the current rate of 5 jets a month since a new problem was discovered was reiterated by the company. It also plans to deliver lower than half the numbers of 787 Dreamliners that are currently in its inventory – which is about a 100 planes, this year. The company had previously said it expected to sell a “vast majority” of the planes.
Since November 2020, when a safety ban on the 737 Max jets was lifted, it delivered more than 130 of the planes, Boeing said, and added that 16 737 Max planes a month were being manufactured by it currently at its Seattle-area factory. The target of the company is to increase the rate to make 31 per month by early 2022.
“Today could be seen as a tactical victory for Boeing, but the strategic challenges remain,” Vertical Research Partners analyst Rob Stallard said in a client note.
The CST-100 Starliner astronaut capsule to the International Space Station to the International Space Station, which has been delayed, is to be launched by Boeing on Friday as a part of a crucial test after a near “catastrophic failure” during its 2019 debut.
(Adapted from USNews.com)