Boeing CEO expects to resume 737 MAX production before mid-year
23 January, 2020, 6:10 pm
WASHINGTON/CHICAGO (Reuters) – Boeing Chief Executive Dave Calhoun told reporters on Wednesday the U.S. planemaker expects to resume 737 MAX production months before its forecasted mid-year return to service and said it did not plan to suspend or cut its dividend.
The company announced a production halt in December, when the global grounding of the fast-selling 737 MAX following two deadly crashes in five months looked set to last into mid-2020 — a timeline pushed back after Boeing endorsed new simulator training for pilots.
Calhoun said the company is not considering scrapping the MAX and expects it will continue to fly for a generation.
“I am all in on it and the company is all in on it,” Calhoun said, adding Boeing will not launch a marketing campaign to get customers to get back on 737 MAX planes.
The company said on Tuesday it now expects regulators to approve the plane’s return to service in the middle of the year. Calhoun said he did not see recent issues raised about wiring or software as “serious problems.”
The production delay threatens to cut U.S. gross domestic product by as much as 0.5 percentage points.
President Donald Trump on Wednesday told CNBC Boeing is a “very disappointing company.”
Boeing shares closed down 1.4% on Wednesday.
Calhoun said Boeing is not planning to cut or suspend the dividend because Boeing has the “financial capacity and capability to do the things we need to do.” Calhoun said he “will stay on that path unless something dramatic changes.”
Calhoun declined to provide a specific date for resumption of production, but said it “will be reinvigorated months before that moment in June because we have to get that line started up again.”
He also said the company would make some changes to the 737 MAX production line to make it more efficient.
The CEO said the company “will slowly, steadily bring our production rate up a few months before that date in the middle of the year.”
He said the company was not planning to lay off any employees because of the latest MAX delay.