Boeing Cancels Contract With GKN PLC For 737 Max Engine

The giant aircraft manufacturer, Boeing, ended its contract with GKN PLC, who was supplying engine parts to it that were used in the manufacturing of the company’s aircraft, 737 Max. The cancellation is going to cause the aircraft company to remodel and redesign the jet and use different innovative resources and parts in the aircraft.

The deal between the two companies was cancelled because GKN would not have been able to cope up with the provision of excessive supplies due to the increased production of Boeing Co. According to Wall Street Journal, 737 Max could provide employment to 125 to 215 people. It is to act as a replacement for the company’s manufactured single-aisle aircrafts and is expected to enter service with Southwest Airlines Co. in its third quarter of 2017.

Boeing said on Tuesday, “We made this decision to ensure we have a product that is not only maintainable and reliable but is producible at the high production rates of the 737 program.” The aerospace company’s decision to end the contract and the parts supplied is not going to change the performance or outcome of the product as well. Any other changes will be the same as they used to be.

The company had to end the contract because it wants a supplier who can provide parts for production in a huge quantity and rapidly. The company needs this because of the growing demand by the customers for airplanes globally. It has already achieved 3,000 orders and currently faces immense pressure to speed up the manufacturing process and provide the customers with the desired aircrafts on time.

The 737 Max has faced issues in the past with production, especially the thrust reverser’s inner wall, which is made of rare titanium so that it weighs lesser and is immune to unpredictable weather conditions. The company has made a promise to airlines that this product is going to be economical compared to other jets with a 14% improvement. 

GKN PLC has not made any comments regarding this news so far. It makes other parts as well for the aerospace company. GKN was informed on Monday about the cancellation of this profitable contract. There are concerns, especially by the investors, who think that it is going to eventually have to cut down its productions of 777 wide-body jets because of the growing popularity of 777X.

Boeing Co. stock closed at $145.05 on November 10.

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Created on Dec 31st 1969 18:00. Viewed 0 times.

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