HomeBusiness/EconomyIncreases In Jet Production May Not Be Supported By Struggling Aerospace Suppliers,...

Increases In Jet Production May Not Be Supported By Struggling Aerospace Suppliers, [Survey]

The aerospace supply chain will not be able to meet Boeing Co. and Airbus SE’s anticipated increases in aircraft production this year, according to a Morgan Stanley poll of 80 suppliers released on Thursday.
A travel boom is driving up demand for jets, and the aerospace industry is trying to accelerate its recovery from a pandemic-related slowdown. However, inflationary pressures and labor shortages are stymieing their progress and dampening sentiment, the survey revealed.

According to Morgan Stanley analyst Kristine Liwag, “this comes as a surprise as we would have expected sentiment to increase with the industry focus on labor, inflation, and supply chain.”

Due to a lack of manpower and parts, Boeing and Airbus have struggled to increase aircraft production. By the end of the year, the American manufacturer hopes to increase manufacturing of its best-selling 737 MAX narrowbody airliner from a constant rate of roughly 31 jets per month to 38.

Meanwhile, Airbus’ arch-rival said on Thursday that it was delaying the start of manufacturing of its best-selling model.

According to Tool Gauge’s chief executive Debbie Lee, labor shortages are still the “greatest bottleneck” for the company, which makes interior parts for the 737 MAX and 787.

The Morgan Stanley study, which was conducted at the Pacific Northwest Aerospace Alliance Annual Conference outside of Seattle, received responses from about 63% of smaller suppliers with annual revenues under $100 million.

Spirit AeroSystems’ CEO stated earlier this month that the company had to negotiate with “approximately a dozen vendors who are continually in severe difficulties.”
In early trading, Boeing shares fell 1.1% against a backdrop of broader market falls.

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