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Boeing puts its economic forecasts in the drawer until the 737 MAX crisis is overcome

The manufacturer closes 2023 with a net loss of $2,242 million

The Alaska Airlines 737-9 MAX from the incident on January 5.NTSB (via REUTERS)

The scandal caused on January 5 with the detachment of a piece of the fuselage of a Boeing 737 MAX 9 aircraft, from the Alaska Airlines fleet, already has an impact on the financial policy of the American manufacturer. Its CEO, Dave Calhoun, has admitted in the framework of the presentation of closing results for 2023 that he is postponing economic estimates in view of the fact that the company “has a lot to prove” to regain the trust of regulators and the companies themselves. airlines.

“While we report our financial results today, we are fully focused on taking comprehensive steps to strengthen quality at Boeing, including listening to the voices of our employees,” Calhoun said. Commercial aviation is already taking steps, in cooperation with the US Civil Aviation Authority (FAA), to strengthen the quality of the 737 program, including additional inspections at the factory and among key suppliers. Boeing also has an independent expert to test the division’s quality management system.

The chief executive has not offered any guidance to investors and analysts, either in the financial field or on aircraft deliveries, ordering the organization to focus on monitoring and reinforcing product quality protocols. “We will take our time to do the right thing,” Calhoun said in a letter sent to the staff, to which Reuters has had access. The CEO has also expressed his confidence that the manufacturer will emerge from this new crisis.

In the sector, it is taken for granted that production lines could be slowed down, which would lead to a loss of steam compared to the European Airbus, where tensions in the supply chain are also recognized. In any case, the American company continues to produce its flagship model, the 737, at a rate of 38 units per day and has not indicated any plans to lower that rate.

Boeing already went through a severe crisis between 2018 and 2019, when two 737 MAX planes suffered separate accidents leaving fatalities. Since then, Calhoun says significant steps have been taken to make safety and quality processes more robust.

The manufacturer closed the fourth quarter with an adjusted loss of 47 cents per share, which compares with $1.75 per share in the comparable period of 2022. Its sales have improved 10%, to $22 billion. And free cash flow for the quarter drops from $3.13 billion to $2.95 billion.

In the entire 2023 fiscal year, net losses have reached 2,242 million dollars, improving from the 5,053 million in the red declared a year ago. Revenues have grown by 17%, to $77,794 million. And the cash flow in the 12 months has been 4,443 million dollars (2,290 million in 2022).

In the absence of new estimates, Boeing conveyed to the market in November its objective of achieving a cash flow of 10 billion dollars in the years 2025 and 2026. Then it indicated that it intended to increase the production rate of the 737 aircraft to fifty a month. .

During the fourth quarter, the Commercial Airplanes area recorded 611 net orders, including 411 737 model aircraft, 98 units of the 777X and another 83 of the 787. The company has begun certification flight testing on the 737-10 and has resumed production in the 777X program. Deliveries have amounted to 157 aircraft in the quarter.

Deliveries throughout the year have been 528 aircraft, while 1,576 net orders were received. The order book exceeds 5,600 commercial aircraft, valued at 441,000 million dollars, out of a total order book of 520,000 million.

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Source: Cincodias

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