Boeing is losing $1 billion a month with planes awaiting parts - and they are sitting in employee parking lots
Boeing is burning through more than $1 billion in cash a month as it has dozens of new planes sitting outside factories in need of parts.
Part shortages and other issues have left Boeing with roughly 200 mostly finished jets sitting on airfields, outside plants and even in employee parking lots, according to the Wall Street Journal.
Some planes need interior parts and others need engines, according to the report. While others are finished and awaiting delivery to China.
The delay in parts is due to supply-chain shortages that have lingered since the pandemic, according to the Journal. For example, seat suppliers haven’t been able to meet demand because of material shortages. There have also been fewer temperature-regulating parts than typical.
Because the 200 planes aren’t in the air, the manufacturer is losing around $1 billion a month. The loss of money is the latest bad news for the beleaguered airline that has seen its reputation and bottom line take a hit following a series of airline safety issues.
“It kind of begs the question: When are you going to deliver these things,” Ron Epstein, an aerospace analyst at Bank of America, told the Journal. “They can only sit around so long before you have to do something with them.”
Boeing has seen its production slowdown since the safety concerns launched a series of federal investigations. In fact, those slowdowns might be helping Boeing as it leads to fewer planes being produced than normal and fewer sitting waiting for final parts.
In total, the company has delivered about 90 fewer planes this year, compared to the same time last year.
Boeing officials say they are working to remove the parked planes and get them completed. The company also noted that the backup of planes hasn’t had a slowdown in production because of a lack of space.
“As we have delivered hundreds of 737s and dozens of 787s from inventory in recent years, we have reduced the parking space needed at several sites,” Boeing told the outlet.
