September 17, 2014 / 2:43 PM / in 3 years

Boeing airplanes chief says considering 52 737s a month by 2018

NEW YORK (Reuters) - Boeing Co (BA.N) appears increasingly likely to boost production of its top-selling 737 jetliners to 52 a month starting in 2018 after the head of its commercial airplanes business spoke about that possibility on Tuesday.

Ray Conner, the CEO of Boeing Commercial Airplanes, speaks during a joint news conference with Hideaki Omiya (not pictured), chairman of the Board of Mitsubishi Heavy Industries Ltd. and other representatives from key partner companies in Tokyo June 12, 2014. REUTERS/Issei Kato

“Our focus today would be around a 52-a-month rate in (737 production) somewhere in that 2018 time frame,” Boeing Commercial Airplanes Chief Executive Officer Ray Conner told an investor conference held by Morgan Stanley.

“Now, I can tell you that the demand is there for those airplanes, significant demand. So I‘m not uncomfortable with the timing or with rate,” he said.

The remarks, among the most explicit by Boeing so far, further cement the widely held view that the Chicago-based company is close to announcing another firm planned rate increase for the narrow-body 737.

The company currently makes 42 737s a month and has set firm plans to lift the rate to 47 a month in 2017.

Last week, Conner said he sees “incredible pressure” to increase the 737 production rate beyond current targets Boeing President and Chief Operating Officer Dennis Muilenburg said the company “had taken a serious look” at raising rates, speaking during last week’s Reuters Aerospace and Defense Summit, but he declined to say whether a decision had been made.

Airbus Group SA (AIR.PA) also is studying raising output of its best-selling A320-family aircraft beyond the record level of 46 jets a month already targeted for 2016. A decision could come by year-end, Airbus Americas President Barry Eccleston told the Reuters Aerospace and Defense Summit.

Both companies have thousands of orders for the agile, fuel-efficient planes, which are immensely popular with low-cost airlines. In Boeing’s case, its backlog of 4,008 737 orders represents nearly eight years of production at current rates, meaning airlines must wait to get planes they order today.

By increasing production rates, Boeing and Airbus create earlier delivery slots that they can sell to customers.

Reporting by Alwyn Scott; Editing by Peter Galloway

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