UPDATE 1-Boeing production of 737 to reach 42 in second quarter

Tue Feb 4, 2014 5:27pm EST

By Alwyn Scott

SEATTLE Feb 4 (Reuters) - Boeing Co said on Tuesday it sees no bubble in the market for 737 jetliners and that production could rise to as many as 60 aircraft a month at the current factory in Renton, Washington, though production may not go that high.

Beverly Wyse, manger of Boeing's 737 program manager, told reporters the factory plans to step up production to 42 per month in the second quarter and may go to 52 per month in 2018 or 2019, but that the company was still studying the possibility.

Faster production of Boeing's best-selling 737 increases revenue, while shortening the time between when airlines order aircraft and when they are delivered, now about eight years on average. Boeing and rival Airbus have record order backlogs.

Boeing this week is starting to step up production to 42 a month from 38 and expects to achieve that rate when the first 737 built at that pace rolls of the line in the second quarter.

The company plans to lift the rate to 47 a month in 2017, Wyse said, adding that the target will not change, even as production of its new 737 MAX begins in 2015 on a third line to be added to the Renton factory.

With a third production line, the Renton factory would be capable of producing more than 60 jets a month, though it is not clear it would go to that rate, Wyse said.

Erik Nelson, director of 737 manufacturing, said Boeing plans to hold steady at 42 a month even as the MAX begins.

"The way I would put it is we'll deliver 42 a month" until the MAX enters service in 2017, he said.

At that point, production would rise to 47 a month, he said.

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