One photo shows why Boeing had to shut down production of its grounded 737 Max
Reuters
Striking photographs show nearly 100 fuselages of Boeing 737 Max planes sitting useless at a Kansas factory parking lot.
The pictures, taken at the headquarters of the supplier Spirit AeroSystems in Wichita, Kansas, illustrate the problem with Boeing's production line while the 737 Max is grounded.
Until the planes are cleared to fly, Boeing has a growing backlog of planes under construction that it can't deliver.
On Monday, the aerospace giant took the embarrassing step of halting production indefinitely while waiting for the US air regulator to clear the plane to fly once more.
A striking set of photographs shows the fuselages of nearly 100 Boeing 737 Max planes sitting unused at a Kansas factory — a vivid illustration of the problems that led the company to suspend production of the plane.
The images were taken by Reuters at the headquarters of Spirit AeroSystems in Wichita, Kansas. Spirit is one of the hundreds of companies in the Boeing supply chain that help produce the finished product.
The photo shows Boeing's snarled production line, which was getting ever more clogged as the company built planes that were not yet legal to fly and could not even be delivered to customers.
Reuters/Nick Oxford
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The planes remain grounded by regulators around the world after two fatal crashes that together killed more than 300 people.
The 737 Max has now been grounded for nine months, significantly longer than many in the industry predicted.
Similar images have shown completed 737 Max planes spilling over into the Boeing employee parking lot in Renton, Washington.
Stephen Brashear/Getty Images
On Monday, Boeing acknowledged its strategy of building planes that couldn't immediately fly was no longer sustainable, and it said it would freeze the production line in the new year. It is not clear when it will be restarted.
Spirit AeroSystems has the capacity to produce about 50 fuselages a month for the Max, and it employs about 13,000 people in Wichita. It is the city's biggest employer.
The company earns 80% of its revenue from Boeing, according to data provided to Business Insider by Bloomberg.
An extended production slowdown could have a significant effect on its bottom line. Other companies in the supply chain are facing similar problems.
While Boeing has said it has no immediate plans to lay off or furlough those who work on the 737 Max while production is stopped, there are fears suppliers will have no choice.
Boeing has the ability to absorb the costs of paying idled workers, but many of its smaller suppliers probably do not.
Reuters/Nick Oxford
As Boeing halts production of the Max, it is likely to stop paying suppliers such as Spirit AeroSystems to save on costs.
In this scenario, according to a Reuters report, furloughs — in which workers are put on temporary unpaid leave — are almost inevitable at Spirit AeroSystems, while layoffs are also possible.
"No way can they keep going," one source told Reuters.
The 737 Max has been grounded worldwide since the crash of Ethiopian Airlines Flight 302, the second of two fatal crashes involving the jet within five months.
Boeing is awaiting a recertification for the 737 Max from the Federal Aviation Administration before it can return the plane to the skies, but that is unlikely to happen until 2020.
The FAA has refused to commit to a time line for the plane's return, instead repeatedly saying the plane would return when "ready."
The FAA even acknowledged in November that its staff was facing pressure to approve the plane soon but said it would ignore all factors except safety in deciding when the plane could come back.
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