The Boeing Co. is boosting jetliner production for the first time in about half a decade because of an increase in orders and the backlog from a 10-week strike, company officials said Tuesday.
Boeing, the world's largest manufacturer of commercial jets, with about 60 percent of the market, will produce more of each model next year. Even a slowdown in production of Boeing's slowest-selling plane, the 757, is being postponed three months.By early 1997, overall production should go from about 20 planes a month to 24, but the impact on employment won't be clarified until Boeing's annual employment forecast is released early next year, a company news release said.
"It reflects the turnaround that our airline customers are experiencing and underscores the positive long-term outlook for our industry," said Ron Woodard, president of Boeing Commercial Airplane Group. "For Boeing to take advantage of this changing marketplance, we will continue our efforts to reduce costs and cycle times and to increase quality."
The turnaround was especially marked for Boeing's smallest planes, the 737s. Instead of going from seven planes a month to five in the fourth quarter of 1996 as planned, 737 production is being increased to 81/2 a month in that period.
The announcement comes five days after the end of a 69-day strike by the Machinists union, which represents more than 32,500 Boeing production workers.
There was less pleasant news for most of Boeing's suppliers: notice of a temporary reduction in orders because of a buildup of parts and materials during the strike.
Deliveries are about 30 planes behind schedule because of the walkout. Plans for catching up are still being developed and won't be completed until next month, said Barbara Murphy, a spokeswoman for Boeing Commercial.
Meanwhile, Boeing has received orders this year for 255 planes worth nearly $18 billion, more than double the 120 planes valued at $7.8 billion ordered in 1994.
The company has been predicting an upswing in orders during the late 1990s, returning to the sort of cycle experienced a decade earlier.
Boeing production went from 25 planes a month at the end of 1988 to 28 at the end of 1989, 34 at the end of 1990 and a peak of 38 at the end of 1991.
Deliveries reached a high of 441 in 1992, then plummeted to 330 in 1993 and 270 last year.
Here is a model-by-model look at production rate changes announced Tuesday:
737 - Now seven a month, going to 81/2 in the fourth quarter.
747 - Now two a month, going to three and a half in the fourth quarter.
757 - Now four a month, dropping to three a month in September, three months later than planned.
767 - Now 31/2 a month, going to four in the fourth quarter.
777 - Now unannounced, set at 31/2 a month by the third quarter and going to five a month by the first quarter of 1997.