Boeing to boost manufacturing capacity to meet burgeoning demand

on Wednesday, April 27, 2011

Boeing to boost manufacturing capacity to meet burgeoning demand  Although it has come under fire in recent months for manufacturing delays and defects in its older-model jetliners, Boeing said this week it plans to boost its manufacturing capacity over the next three years.

According to the company, it will increase its production by 40 percent through 2014 to keep up with burgeoning demand for its aircrafts and to make room for new jetliner models that are scheduled to hit the market in the coming years. The move, however, has divided analysts as it is risky for the U.S.-based aerospace giant.

"That's a bigger year-to-year jump that I’ve seen since the 1960s, when companies ramped up production practically overnight at the introduction of the jet age," affirmed Frost & Sullivan aerospace analyst Wayne Plucker. "And once you've established a rate, you've made a serious commitment of personnel and equipment."

Now, airlines are clamoring to update their fleets as oil prices soar and eat into their profit margins. Boeing has witnessed an uptick in business from the soaring demand, and the production shifts are meant to satiate its customers, the company said.

MarketWatch reports that Boeing's order backlog has risen over the past few years and now stands at over 3,400 jetliners valued at $263 billion.

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