Military

Boeing Outsells Airbus in 2012, Faces More Inspections

Boeing 737-MAX-7-8-9 Artwork
courtesy Boeing Co.
If all that Boeing Co. (NYSE: BA) had to do was build and sell airplanes, 2012 would go down as the biggest success ever. The company is expected to have delivered 585 aircraft last year, the most in its history. Boeing also took orders for 1,121 new planes, the second-most ever.

But problems with its new 787 Dreamliner, continuing issues with its aging 737 single-aisle planes and labor troubles have plagued the company. Boeing seems to succeed in spite of its management.

The 787 Dreamliner has had issues with delamination of the plane’s carbon-fiber fuselage, and more recently, generator problems that have grounded planes. As the chief of Qatar Airways said after a second 787 was grounded, “We are not buying airplanes from them to put in a museum.”

More than 100 older 737s owned by Southwest Airlines Co. (NYSE: LUV) are the subject of a new order from the FAA today that will force Boeing to inspect and repair previously repaired areas:

We are issuing this [airworthiness directive] to detect and correct fatigue cracking of the fuselage skin, which could cause the fuselage skin to fracture and fail, and result in rapid decompression of the airplane.

Management also needs to avoid a threatened strike from the company’s engineers and technicians, and it has to make decisions on which new planes will position the company best against rival Airbus. Sadly, Boeing’s management is usually not up to any very demanding task.

Shares of Boeing are up about 0.9% in the premarket this morning, at $76.07 in a 52-week range of $66.82 to $77.83.

Paul Ausick

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