Boeing said to prepare for 737 rate hike as soon as October

Core Viewpoint - Boeing is optimistic about increasing the production rate of its 737 Max jets, potentially reaching 42 jets per month by October, with further increases planned for April and late 2026, aiming for a total of 53 jets per month by the end of next year [1][2][3]. Production Plans - Boeing is preparing to increase the manufacturing pace of the 737 Max, with a target of 42 jets per month by the end of 2025 and 53 jets per month by the end of 2026 [1][2]. - The company must convince the FAA that its factories and suppliers can maintain quality while increasing production [4][5]. Regulatory Oversight - The FAA is closely monitoring Boeing's production processes and will work with the company to ensure safety as production rates increase [5][9]. - Boeing has established six performance metrics for the FAA to assess its progress in addressing production shortfalls [9]. Financial Implications - Increasing production is crucial for Boeing to improve its financial situation and pay down debt, with expectations of positive cash flow as 737 output rises [6][10]. - Investors are closely watching Boeing's financial performance, particularly in the upcoming third-quarter earnings report [6]. Management Confidence - CEO Kelly Ortberg has expressed confidence in reaching the production milestone of 42 jets per month by the end of the year, emphasizing the importance of stabilizing factory performance metrics [7][8]. - Boeing's production schedule will be driven by factory progress, with careful reviews and adjustments as necessary [8]. Industry Context - Boeing's production efforts are seen as a response to the competitive pressure from Airbus, which plans to increase its A320neo family production to 75 units per month by 2027 [14]. - The company has faced challenges, including a two-month strike and safety inspections following manufacturing issues, which have impacted production rates [12][13].