(Reuters) – Boeing Co’s suppliers are bracing for a possible halt in production of the 737 MAX, as the grounding of the planemaker’s fast-selling aircraft is pushed into 2020, possibly resulting in lost revenues and adding to billions of dollars in costs.
FILE PHOTO: People work near the door of a 737 Max aircraft at the Boeing factory in Renton, Washington, U.S., March 27, 2019. REUTERS/Lindsey Wasson/File Photo
Boeing has continued to purchase parts from some suppliers at a production rate higher than its own, in order to keep the supply chain fluid and avoid major disruptions when the MAX returns to service.
Analysts say a suspension of MAX production would pressure suppliers, depending on the sales exposure they have to Boeing.
The aero parts maker gets nearly 80% of revenue from Boeing. It makes the MAX fuselage, pylons, thrust reverser, wing leading edges and engine nacelles.
The joint venture company of General Electric and Safran SA is the biggest supplier of engines to the MAX.
Boeing is biggest customer for the British engineer’s aerospace unit. It makes MAX parts including airframes and engine build-up tubes.
United Technologies Corp
The U.S. industrial conglomerate counts Boeing among its biggest customers and has warned of a 10 cent hit to 2019 earnings per share due to the MAX grounding. It makes landing systems, avionics and interior lighting for the MAX.
Honeywell International Inc
The diversified U.S. manufacturer counts Boeing among its biggest customers. It makes parts including auxiliary power units, weather radars and cockpit advisory systems that increase flight crew awareness of surroundings during taxi, takeoff and landing.
Boeing is Hexcel’s second-biggest customer, accounting for 25% of its annual sales. It makes composite materials used on the MAX airframe and engines.
The U.S. aircraft parts maker gets about 15% of its annual sales from Boeing, its biggest customer. It makes parts including thrust reverser actuation system for the MAX.
The UK-based aircraft parts maker counts Boeing among its largest customers. It makes parts including fire protection system for the MAX engine and auxiliary power unit.
Source: Company filings and presentations, Reuters reports
Compiled by Ankit Ajmera and Dominic Roshan in Bengaluru; Editing by Maju Samuel