Boeing faces huge order backlog after strike

Almost two months later, Boeing strike is over. Members of the International Association of Machinists and Aerospace Workers voted to accept the new contract Monday night, meaning they can return to work this week.

And there is no shortage of work. This fall, the plane maker said the backlog was more than 6,000 planes. But this is not just a Boeing problem. Another major commercial aircraft maker, Airbus, has a similarly large backlog.

This marks the start of a turbulent year for Boeing. the door plug fell out in Januaryafter which the federal government limited the company’s ability to produce new aircraft.

But there are underlying factors that have made it much harder to get back into it—surprise! – pandemic.

“We’ve actually seen a huge increase in demand for both cargo and passenger air travel since the pandemic,” said Fekri Karanki, assistant professor at Purdue University.

As airlines saw increased demand to transport people and things in the wake of the pandemic, they ordered more planes. The problem was that “COVID has really caused incredible damage to the high-tech aerospace and defense supply chain,” said Peter Arment, managing director of RW Baird, which is an underwriter of Marketplace.

Hundreds of small companies around the world supply critical components to two major aircraft manufacturers.

When pandemic restrictions began, many older, skilled workers at these providers left and never returned, Arment said.

“It’s impacted performance and it’s going to take time to fix,” Arment said.

But even before the pandemic, many of those suppliers were already struggling after Boeing grounded production of its popular 737 Max model following two deadly crashes.

“When you shut down ubiquitous aircraft, you force your suppliers to either eat up their inventory or, in some cases, go out of business because they can’t sell it,” said Robert Mann, an independent aviation consultant. .

Then COVID disruptions meant many remaining suppliers faced supply chain issues of their own.

“So you just yank the supply chain over and over again and expect it to somehow magically come back,” Mann said.

But that didn’t happen, Mann said, leaving a large backlog of work.

And they are holding airlines back, says Henry Harteveldt of AtmSphere Research Group.

“Either they operate older, more expensive, less fuel-efficient aircraft, longer aircraft, or they don’t even operate all those aircraft, they may have to be taken out of service and they will shrink,” Hartveldt said.

If they don’t get more new planes soon, Harteveldt says passengers might feel it.