Boeing CEO says 737 Max production ramp delayed, free cash flow to land at $2 billion

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Boeing CEO Kelly Ortberg said Wednesday that stabilizing 737 Max output at 47 jets per month is taking longer than expected, sending Boeing stock down 4% by the close of trading. Speaking at a Morgan Stanley conference, Ortberg pointed to the Renton, Washington factory's wing output as the primary bottleneck holding back the higher production rate, and said hitting 52 jets per month next year will require Boeing to get wing manufacturing up to speed and win certification for an additional 737 line in Everett, Washington. Boeing Chief Financial Officer Jay Malave said at the same conference that the slower production ramp on both the 737 and the 787 Dreamliner means Boeing will likely land at $2 billion in free cash flow, the midpoint of its January guidance, rather than the $3 billion upside target. On the 787, Ortberg said engine shortages are slowing a planned increase to 10 jets per month from the current eight, with slow certification of premium seats weighing on deliveries, and he said the largest 737 variant, the Max 10, will be certified very soon; that plane is years behind schedule and accounts for about 30% of all 737 orders. Ortberg also tamped down expectations that President Donald Trump's planned meeting with Chinese President Xi Jinping on Sept. 24 would produce a Boeing announcement, saying orders from China are going to be announced by the airlines at their pace.

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CFO says slower production ramp means free cash flow will land at $2 billion, below the $3 billion upside target

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