Boeing dips as BofA says 737 production seems halted amid IAM strike

Investing.com -- Boeing (NYSE:BA ) shares dipped 1% Tuesday after Bank of America reported that production of the 737 appears to have come to a standstill due to a strike by the International Association of Machinists (IAM) union.

The production halt has significantly slowed deliveries, with only two 737 jets delivered in the past week, well below normal levels, according to data from Aero Analysis Partners/AIR (AAP/AIR).

"According to data from Aero Analysis Partners/AIR (AAP/AIR), Boeing 737's production may have come to a complete halt following the IAM union strike," said BofA.

The analysts noted that while customer acceptance and pre-delivery flights are still ongoing, only four more deliveries are expected in the near future unless those aircraft require additional rework.

Moreover, they said there has been no activity involving Chinese airlines for over a month, with some reactivations of previously stored aircraft being put on hold.

BofA adds that Boeing's 787 program also faces delays, with only two aircraft delivered since the start of September. However, AAP/AIR still expects five more deliveries by the end of the month, as Charleston's Final Assembly Line remains largely unaffected by union strikes.

Boeing's inventory of undelivered 737s has decreased to 156, down from 190 in the previous month, notes the bank.

While the full impact of the strike remains uncertain, the significant slowdown in deliveries could pose challenges for Boeing. Bank of America maintained a Neutral rating on Boeing's stock with a price target of $200.

Source: Investing.com