FAA increases Boeing 737 Max production cap to 42 per month

Boeing won approval from regulators to increase production of its top-selling 737 Max jetliners to 42 per month, a milestone for the manufacturer nearly two years after the Federal Aviation Administration capped its production following a near-air disaster.

In January 2024, the FAA limited Boeing to building planes at a rate of no more than 38 per month – although it was lower than that at the time – after a door plug on a nearly new 737 Max 9 exploded a Alaska Airlines flight while leaving Portland, Oregon.

Boeing failed to reinstall the keyed bolts on the door plug before leaving the factory, according to a National Transportation Safety Board report. The 737 Max returned and landed safely, but it put the company back into crisis mode just when executives were expecting a year of recovery.

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

Boeing said it would work with its suppliers to increase production.

“We appreciate the work of our team, our suppliers and the FAA to ensure we are prepared to increase production with safety and quality first,” Boeing said Friday in a statement.

Increasing production is key to the company’s turnaround after years of problems, since airlines and other customers pay for the bulk of a plane when they receive it. CEO Kelly Ortberg, appointed last year to stabilize the top U.S. automaker, said last month he expected to soon get FAA approval to increase production to 42, with more increases planned later.

“We’ll start from 42, and then we’ll go up five more, and we’ll go up five more,” Ortberg said at a Morgan Stanley investor conference in September. “We will get to a point where those inventories will be more balanced with the supply chain, probably around the production rate of 47 per month.”

The change shows the FAA’s softened tone and increased confidence in Boeing after years of restrictions. Last month, the agency said it would allow Boeing to re-approve some of its planes itself before they are released to customers, instead of that responsibility falling solely to the FAA.

The Max program was crippled following two plane crashes in 2018 and 2019, which killed all 346 people on the two flights. The plane remained grounded for almost two years. Covid also hurt production, followed by supply chain problems and, last year, a strike at major Boeing factories in the Seattle area.

Boeing hasn’t posted an annual profit since 2018. But it has increased production and its deliveries of new planes are on track to hit the highest pace since that year.

Boeing is expected to release its quarterly results on October 29.

—CNBC Phil LeBeau And Meghan Reeder contributed to this report.