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Boeing finally got some much-needed wins
BABoeing(BA) Business Insider·2025-03-27 09:20

Core Insights - Boeing is experiencing a positive turnaround, securing significant defense contracts and new aircraft orders, which may enhance investor and customer confidence [1][8][9] - The company has seen a stock price increase of approximately 16% over the past six months, indicating a recovery from earlier lows despite broader market challenges [2] - Analysts project a future price target of 196forBoeingshares,suggestingoptimismaboutthecompany′sprospects[3]AircraftOrdersandProduction−KoreanAirhasfinalizedanorderfor20Boeing777Xplanes,followingsimilarordersfromJapanAirlinesandMalaysiaAirlinesfor17andupto60new737Maxaircraft,respectively[4]−The777Xprogramissignificantlydelayed,withitslaunchnowexpectedin2026,whiletheproductionofthe737Maxiscurrentlycappedat38unitspermonth[4][5]−Boeing′sbacklogexceeds6,000aircraft,reflectingcustomerconfidencedespitepreviousdeliveryslowdowns[5]LeadershipandOperationalImprovements−CEOKellyOrtbergaimstoincreasethe737Maxproductionrateto42unitspermonthbyyear−end,contingentonmeetingqualityandsafetystandards[6]−Thecompanyplanstoclosethe"shadowfactory"forqualityfixes,whichisexpectedtoenhanceoperationalefficiency[6]−UnitedAirlines′CFOexpressedconfidenceinBoeing′sdeliveryschedule,highlightingimprovementsinreliabilityasasupplier[7]DefenseContractsandFutureOutlook−Boeingsecureda196 for Boeing shares, suggesting optimism about the company's prospects [3] Aircraft Orders and Production - Korean Air has finalized an order for 20 Boeing 777X planes, following similar orders from Japan Airlines and Malaysia Airlines for 17 and up to 60 new 737 Max aircraft, respectively [4] - The 777X program is significantly delayed, with its launch now expected in 2026, while the production of the 737 Max is currently capped at 38 units per month [4][5] - Boeing's backlog exceeds 6,000 aircraft, reflecting customer confidence despite previous delivery slowdowns [5] Leadership and Operational Improvements - CEO Kelly Ortberg aims to increase the 737 Max production rate to 42 units per month by year-end, contingent on meeting quality and safety standards [6] - The company plans to close the "shadow factory" for quality fixes, which is expected to enhance operational efficiency [6] - United Airlines' CFO expressed confidence in Boeing's delivery schedule, highlighting improvements in reliability as a supplier [7] Defense Contracts and Future Outlook - Boeing secured a 20 billion contract for the F-47 fighter jet, which is expected to bolster its defense business and improve employee morale [8][10] - The contract is seen as a significant boost for Boeing, especially after challenges faced in other defense programs [9][10] - Analysts believe that the new defense program will help attract and retain engineering talent, aiding in the company's cultural recovery [10][11]