March 17, 2010

For more than a year, the fear in Wichita was that the other shoe was going to drop. The other show being significant production rate cuts on commercial airliners, particularly the 737. Instead, Boeing now hints of an increase.

"It'd be good for our economy to raise the rate," says a Spirit Aerosystems employee leaving work Wednesday.

Production rate increases would be a shot in the arm for the local economy and now there’s reason to hope Boeing might just raise rates on the 737 and 777.

"We're taking a hard look at what we want to do with the rate." says Jim Albaugh, Boeing Commercial Division President.

For well over a year aviation experts had been predicting production rate cuts at Boeing, which would directly impact work at Wichita’s Spirit Aerosystems and many smaller suppliers

The experts were partially right. Boeing cut rates on two wide-body planes, 777 and 747. But, the experts have been wrong on 737 cuts. The 737 is the biggest program at Spirit. And now it appears Boeing might raise those rates.

"Right now we're at 31 and a half airplanes per month. And we will make a decision some time this summer about increasing that rate." Albaugh said.

Boeing has asked Spirit Aerosystems to study possible rate increases.

"They ask us all the time to study certain scenarios so we study whatever scenario they ask us to do. And we have studied some scenarios where we would go faster," Richard "Buck" Buchanan, Spirit Aerosytems Sr. V.P. Chief Operations Officer said.

Albaugh says Boeing is considering rate increases because it’s sold out in 2011, over committed in 2012 and the company predicts airlines will be ordering new planes at a brisker pace in 2012

"So we're aware they're doing some studies. We participate in those studies and so that would be great news if they want to build more of them. But we'll just have to wait and see. "That would be great. Anything that makes more jobs." "Buck" Buchanan said.