FAA raises Boeing 737 Max production cap to 42 aircraft per month

boeing The company has won regulatory approval to increase production of its best-selling 737 Max jetliner to 42 jets per month. The move marks a milestone for the company, which comes nearly two years after the Federal Aviation Administration restricted production following a near-airborne catastrophe.

After the door plug of a nearly new 737 Max 9 blew, the FAA in January 2024 restricted Boeing to producing no more than 38 planes per month (though it was below that level at the time). alaska airlines Flight ascending from Portland, Oregon.

A National Transportation Safety Board report found that Boeing did not reinstall the door plug key bolts before leaving the factory. The 737 Max returned home and landed safely, but just when management was hoping for a year of transformation, the company slipped back into crisis mode.

The FAA announced Friday that it will continue to oversee Boeing’s production. “FAA safety inspectors conducted an extensive inspection of Boeing’s production lines to ensure that this small production rate increase could be done safely,” the agency said in a statement.

Boeing said it would work with suppliers to increase production.

“We appreciate the efforts of our teams, suppliers and the FAA to ensure we remain ready to increase production with safety and quality at the forefront,” Boeing said in a statement Friday.

Increased production is key to the company’s turnaround after years of problems, as airlines and other customers pay most of the price when they receive the aircraft. Chief Executive Officer Kelly Ortberg, who was appointed last year to stabilize the top U.S. manufacturer, said last month that FAA approval to increase production to 42 is expected soon, with other increases planned in the future.

“We’re going to go from $42 to another $5 and another $5,” Ortberg said at a Morgan Stanley investor conference in September. “We’ll get to a point where inventory is more balanced with the supply chain, probably around a monthly production rate of 47 pieces.”

The changes signal a softening of the FAA’s stance after years of regulation and increased confidence in Boeing. The agency announced last month that it would allow Boeing to re-certify some of its planes before delivering them to customers, rather than leaving that responsibility solely to the FAA.

The Max mission was crippled by two plane crashes in 2018 and 2019, killing all 346 people on board. The aircraft was grounded for nearly two years. The coronavirus has also hurt production, followed by supply chain issues and a worker strike at Boeing’s main factory in the Seattle area last year.

Boeing has not reported an annual profit since 2018, but production has increased and the delivery rate of new aircraft is on track to reach its highest level since that year.

Boeing is scheduled to release its quarterly results on October 29th.

—CNBC’s Phil LeBeau and Meghan Reeder contributed to this report.