Boeing expects 787 suppliers to catch up by year's end, restoring output

By Allison Lampert

(Reuters) - Boeing expects delayed suppliers to catch up on parts that have slowed production of its 787 jets to below a rate of five a month, as the U.S. planemaker works to restore output of two key commercial programs by the year's end.

Boeing and its European rival Airbus are struggling to meet strong airline demand for jets as they wrestle with problems within their supply chains and factories.

Such concerns are set to cast a shadow at the Farnborough Airshow from July 22 to 26, despite strong travel demand.

Earlier this year, Boeing lowered 787 output to allow "suppliers to catch up with us," a company executive told reporters during a June visit to its sprawling 777 widebody factory in Everett, Washington State.

"Our plan is to return to five a month later this year again as we see that incoming supply of parts comes back to where it needs to be," said Scott Stocker, vice president and general manager of the 787 program in South Carolina.

Boeing executives told reporters the company is taking similar steps to increase employee feedback and production quality on its widebody jets which fly long international routes as its single-aisle 737 MAX.

The planemaker is under heightened legal and regulatory scrutiny following the January mid-air blowout of a door plug on a near new 737 MAX 9 blamed on missing bolts. Boeing has said it would restore 737 output to around 38 by the year's end after production of its strongest-selling jet plummeted.

While the planemaker scored a boost for its widebodies by starting certification flight testing this month of its long-delayed 777-9, delays in the supply of seats and heat exchangers have created separate challenges for the 787.

Stocker said a separate problem with fasteners on the Dreamliner revealed by Reuters in June is not impacting the current rate.

Stocker also said Boeing has done an exhaustive fleet analysis, after the planemaker was alerted earlier this year by an employee that certain tests that were not performed had been completed. The U.S. Federal Aviation Administration (FAA) has opened an investigation.

"We have found that we have to go back in and address some of the work that was not done, you know, properly," he said. "The investigation continues but have made really good progress."

Boeing halted deliveries of the 787 widebody jet for more than a year until August 2022 as the FAA investigated quality problems and manufacturing flaws.

The planemaker, nevertheless, is eyeing higher Dreamliner production, after setting a target rate of 10 a month for the Dreamliner in the 2025-2026 timeframe at its 2022 investor day.

Stocker did not specify a longer-term target: "We are planning to go up in rates over the next several years,"

(Reporting By Allison Lampert; editing by David Evans)