Boeing Still Seeing Demand For Current 737

January 11, 2012

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Boeing expects to see continued robust demand for the current model of its narrow-body 737 - the NG - even as it promotes the upcoming 737 MAX and its promises of fuel efficiency, the 737 head said on Tuesday.

Some airline and military customers will keep ordering the NG simply because it is available now and because they are comfortable with it, Beverly Wyse, general manager on the Boeing 737, told reporters after an event celebrating a production rate increase for the aircraft.

The NG and the MAX will be made simultaneously until Boeing can phase out the older model, Wyse said.

"We'll let the market tell us what the timeline is," she said.

Boeing has increased production on its 737 line to 35 aircraft per month. The company aims to make 38 737s per month in the second quarter of 2013 and 42 per month in the first half of 2014.

The company is ramping up production on all of its commercial aircraft lines to accommodate increased demand.

Wyse said Boeing will add a MAX production line alongside the existing two NG lines and hire at least 600 new employees.

"We're really going to build on the existing production system we have today, because it's been so successful," she said.

The 737 is Boeing's best-selling aircraft, with 2,365 unfilled orders on its books, according to the company's website. Boeing lists 150 firm orders for the MAX from Southwest Airlines, but the company has said it has commitments from customers for about 1,000 more.

Last year, Boeing unveiled plans to update the 737 with a new fuel-efficient engine. The aircraft, dubbed MAX, is set to enter service in 2017.

Boeing, which trailed Airbus in commercial orders last year, hopes the MAX will close the order gap. The plane competes directly with the Airbus A320neo, a re-engined version of the Airbus A320.

Boeing says it hopes to have 1,300 to 1,400 firm orders by the end of 2012.

(Reuters)