Boeing 737 MAX crisis could engulf Melbourne plant


Meanwhile, Indonesian carrier Lion Air, the operator of October’s crash, was reported this week to be considering cancelling its order of 200 MAX aircraft.

The uncertainty comes as Boeing’s factory in Port Melbourne is set to step up its new production line making AT winglets for MAX aircraft, with the first delivery of the aerodynamic wing ends due to be shipped to the United States next month.

Boeing’s Australian plant is one of three worldwide making the winglets, and production is due to increase during the year as Boeing targets an output of 57 new MAX aircraft a month.

The winglet program is an important one for the Melbourne factory and its workers, as it is winding down its production line for 777 rudders and elevators because of the introduction of Boeing’s new 777X-series aircraft.

Boeing’s factory in Melbourne, which employs about 1100 people, is also the sole site globally for assembling the hinged trailing edge, called ailerons, for the wings of all 737 series aircraft.

“They will not be delivering aircraft, so that will have an immediate impact,” said Diogenis Papiomytis, an aerospace analyst at the global consultancy Frost & Sullivan.

“You have to postpone deliveries – basically the factory will be sitting idle.”

Richard Aboulafia, vice-president of aerospace intelligence firm Teal Group, said the production line could be halted if there was continued uncertainty around the MAX, or if investigations into the two crashes discovered a complex problem for Boeing to solve.

“This would likely result in a production stop, to avoid a serious traffic jam due to the very high volume production line,” he said.

However, Mr Aboulafia said a more likely scenario was that the cause of the second crash was discovered and that there was no difficult problem to fix, meaning the planes could return to the skies and production would continue as planned.

Boeing declined to comment on what impact the MAX crashes and related production delays or cancellations could have on its Australian operations.

Virgin said it could not comment on the potential costs involved if it delayed or cancelled its MAX order.

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