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Interview: Why Boeing’s CEO Sees The Next Narrowbody 'Moving To The Right'
Boeing CEO Kelly Ortberg (left) with Aviation Week editors on the balcony at the company’s Seattle Delivery Center.
Assuming the CEO position at embattled Boeing 22 months ago, Kelly Ortberg eschewed corporate headquarters in Virginia for an office more than 2,700 mi. away at the company’s Seattle Delivery Center, where from a balcony he views aircraft on the ramp and occasionally calls surprised crews to check on progress. In the runup to the Farnborough International Airshow, Ortberg met at his office with Aviation Week Editor-in Chief Joe Anselmo and Senior Editor Guy Norris for a wide-ranging discussion.
AW&ST: How confident are you that the troubles that were plaguing the company in 2024 are in the rearview mirror? Is Boeing Commercial Airplanes ready to ramp up rates?
I’m pretty comfortable with the progress we’ve made. We ramped up to 38 [737s per month], then went to 42, and now we’ve gotten approval to go to 47. Our key metrics have stayed more stable than I expected. If we start to see instability, we’ll slow down. Setting the tone that doing it right is more important than [hitting a delivery benchmark] is permeating the organization. In the end, it will allow us to go faster because we aren’t pushing work down the production line, we’re not reworking, and we’re bringing higher-quality supply chain products into the final assembly. Our customers are saying these are the highest-quality airplanes they’ve received from Boeing.
You’ve said a longer-term ambition is to get to 63 737 deliveries per month, but there are reports floating even higher numbers. Can you clarify?
Our plan is 63. We’re always running scenarios, partially to see where the stress point in the system is, but those higher numbers are nothing more than studies. We’ve got a lot of work between now and 63.
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A year ago, you told us that three things needed to fall into place before you could launch a next--generation airplane: financial stability, demand from the market and technology. How much closer are you to ticking any of those boxes?
That’s an interesting question. We’re continuing to mature the technology. But I would say the markets are further from being ready than they were when we talked a year ago. I think it’s because of the maturity of the on-wing performance, whether it’s our airplane or our competitors’ airplanes. The airline customers want better on-wing performance of the engine, and the message I’m constantly hearing is, “Forget about something new; let’s get what we’ve got performing better.” I think the market is more focused on existing platforms and durability improvements that are going into the engines.
What kind of technologies are you looking into to differentiate Boeing on its next airplane?
I don’t want to detail our strategy too much for competitive reasons. We’re studying the configuration of both the airplane and the production system. The evolution in technology is not just the aerostructure or the engine, but also how you can efficiently build a next generation at higher quantities in a more streamlined way. As we finish certification of the 737 MAX [-10 and -7] and the 777X, we will have more resources to be focused on what’s next. We’ve got to get our finances ready, but there’s no reason to launch an airplane until the market is ready. And demand in the last year for our existing product lines continues to be very, very strong.
In terms of timing, are the 2030s still a realistic target for service entry of a new airplane?
It’s probably realistic in terms of what we could do, but I don’t think the market has matured at all in the last year. There’s no question that the time frame is moving to the right in terms of when the airplane is going to be available. I think the market is going to somewhat decide that for us.
As you look at where the market may emerge, does it look like it would be the next-generation single--aisle first, or would it go back to the pre-COVID-19 New Midmarket Airplane (NMA) study?
We’re circling around all of that right now. We’re probably more focused today on the next-generation single-aisle family.
Over the past 50 years, Airbus has mostly chased Boeing in new product launches. If Airbus decides to launch a less ambitious but more realistic new-generation single--aisle in the 2030s, would that steer you to move faster?
I don’t think that the competition’s timing is an overly dramatic factor. We’ll do it when the market says and when we’re ready. This is a decision that lasts 50 years. I don’t think you’ll see us panic in response to a competitive [move]. This will be more strategic, well thought out.
Are you seeing any impact on Boeing’s business from the Middle East conflict and the resulting spike in jet fuel prices?
Nothing material. Nobody is asking us to delay deliveries. We’re not seeing any material impact in our maintenance, repair and overhaul. A number of non-Middle East customers have reached out and said they’d certainly be interested if airplanes become available. About 14% of our backlog is in the Middle East, and most of those deliveries are [for] 2030 and beyond. I think someone would have to think long and hard about whether they want to get out of line right now relative to this short-term issue.
Could you give us more clarity on the timing of 777-9 certification and why Extended-Range Twin-Engine Operations (ETOPS) has shifted to the right?
Customers are patiently waiting for us to get this done and into the marketplace. We just got TIA-4B [FAA Type Inspection Authorization flight testing] right, which is big. After that comes TIA-5, ETOPS and function and reliability testing, which is generally done at the same time. I do want to clarify: We do not plan on making any deliveries pre-ETOPS completion. The customers for this airplane want an ETOPS configuration. We’ve just got a lot of work to do between now and the end of the year.
Boeing Commercial Airplanes chief Stephanie Pope told our sister publication Air Transport World that Boeing was hoping to complete 777X certification by the end of this year. But FAA Administrator Bryan Bedford recently told Aviation Week’s CAPA Americas conference that it won’t happen until early 2027.
I think we’re all just teetering on the edge of the year and how much breathing space we want to give our teams to get this thing done. I want to reiterate that we’re not anticipating any delivery delays in ’27. I feel pretty comfortable that we’re making the progress we need to. We have not uncovered any new airplane issues, and we’re hoping that’s the case going forward.
It also looks like you’re closing in on certification of the 737-7 and -10.
We’re very close to 90% complete on the flight-test program. We’ve got a few things yet to do, and then it becomes more of a paperwork exercise. The -7 will probably be a little bit before the -10, but we’re still clearly looking for both of those to be done this year so we can start the deliveries. We’ve invested pretty heavily in a [737] North line in Everett, [Washington,] and on July 6 we will load the first fuselage in that production. That will give us a lot more flexibility and risk management in our production.
Boeing is currently building 787s at eight per month, and the plan, as we understand it, is to go to 10.2 in 2027 and 12 in 2028. That seems quite conservative. Is it because of supply chain considerations?
Is that conservative? Is it aggressive? As we’ve moved from five to seven to eight, it has taken us a little longer to stabilize at eight. While we’re building, our deliveries have been a little lumpy, and that’s predominantly with seats. You probably saw the Riyadh Air delivery announcement where we had the airplanes built but not the seat certifications. And there’s a few more of those that will deliver out soon. In May, we delivered 60 airplanes but only six 787s. That will improve as we unleash these seat configuration deliveries.
You originally said you hoped to deliver 90-100 787s this year.
We’re still hovering right in that zone. Before we go to 10 [per month], we do need to see improvements in engine deliveries. [GE Aerospace] has been behind plan this first quarter. They’ve got a corrective engine plan. It’s important that they accomplish that over the summer months so we can look at a higher production rate.
Is it possible Boeing could authorize a study to reengine the 787 in the next decade?
That’s always possible. I think the technology that we have today is good. We need to make sure that it’s reliable. We have multiple [engine] choices [with GE and Rolls-Royce] on the 787. Rolls-Royce has introduced durability improvements. We’ll see how that performs in the marketplace.
And maybe a 787 freighter, too?
We’ll see.
You went with President Donald Trump to China in May and came back with 200 orders. Wall Street was unhappy it wasn’t more.
From my perspective, the trip was very successful. We hadn’t had a narrowbody order [from China] in almost a decade. The whole objective was to open that market back up. I think people kind of got fixated on the initial quantity. The trip was very successful, and there will be more.
Could you see China placing orders for 777Xs?
I absolutely believe there’s a future in China. Globally, once the airplane is certified and proven in service, there are opportunities to expand beyond the current carriers that have made orders.
How is your supply chain performing compared with a year ago?
On MAX, the supply chain is good. We always have pop-up things. Last year, we had the fastener fire. This year, we’ve got the GKN [chemical leak in California] that we’re working through. Having said that, there’s no commodity constraint that has me concerned for the Rate 47 [MAXs per month] or the Rate 52. As we move [up] from 52 and beyond, supply chain challenges will be bigger, for sure.
Boeing’s acquisition of Embraer’s commercial operations fell apart six years ago, but some still see potential alignment between the two companies. Could you see a partnership with Embraer down the road?
Embraer is a great company. In my previous life [at Rockwell Collins and Collins Aerospace], I did a lot of work with Embraer, and I have a lot of respect for their technical capabilities. I’d certainly be open to working with Embraer in the future, if that made sense.
What about Boeing Defense, Space and Security (BDS)? Are all of those write-offs over with?
We’ve made a lot of progress on the development programs in BDS. We recently had Milestone C [transitions from development to low-rate production] on the T-7 trainer and the MQ-25 Navy refueling platform. We’ve also partnered with our customers to restructure some of the work in these contracts, and that’s helped us reduce risk. Having said that, you’re never done with these development programs, and we still have work to do. I’m sure we’ll have more challenges along the way, but [the kind] you would expect in a more normal defense business.
How is Boeing preparing for the financial risks if the U.S. Air Force adopts a fixed-price approach on the low-rate initial production (LRIP) lot on the F-47 and maybe the F/A-XX sixth-generation fighter?
I can’t address the contract type on F-47, but generically, we’re working with the customers at the Department of War on all development programs and making sure that the contract structure is correct. Now, that doesn’t mean we’ll never do a fixed-price program again, but if we do, it’s got to have the right risk profile and contractual baseline. We got in trouble in the past when there was a lot of concurrency between the development and the actual production, so you’d get a lot of aircraft built or partially built, and then they’d need to be modified or upgraded. We’re just being very careful that we’re entering into new contracts where we don’t get into those problems.
How does BDS compete in an era when we’re seeing the Pentagon embracing nontraditional suppliers to a degree we’ve never seen before?
We’re competing. We’ve got the MQ-28 for [the Collaborative Combat Aircraft program]. I do think there are new entrants that are going to push things in new directions, and that is going to push us, which is probably good. I’m not overly worried. We finished [2025] with record backlog in BDS. Our products are very much in need. In the last year, our outlook on BDS is even stronger.
Where will Boeing be playing in the Golden Dome missile defense initiative?
It will likely be more of a capability set from multiple platforms than a big individual program. We have a lot of bits and pieces to help integrate the solution. I look at space generically, and you’ve got the NASA work and then the national security space, our communications satellites, our X-37 platform. A lot of that is classified work, and that’s an area where we’re seeing a lot of growth. Despite the challenges we’ve had in the NASA work, we’ve done quite well in national security space. [An initial $2.8 billion contract to deliver communications satellites to support nuclear command, control and communications] will be huge for us going forward.
Considering its checkered history, is the Starliner astronaut crew vehicle still a viable program for Boeing?
We’ve made most of the corrective actions that came out of the prior flight test. It is still our plan to have additional launches. NASA is working through that schedule. It looks like there might be one launch this year instead of two. The first looks like it would be uncrewed and the follow-on crewed. We think we’ve got a good handle on the thruster problems and corrective actions to fix them.
You sound more optimistic on the Starliner than when we met a year ago.
A year ago was pretty fresh. We hadn’t done the root cause analysis yet to understand what corrective action [was needed]. We’ve been through exhaustive testing. So I’m more confident that we’ve got our arms around what needs to be done to have a successful program.
Boeing is the prime contractor for NASA’s Space Launch System (SLS) core stage. The SLS performed remarkably well for Artemis this year. Any thoughts about ensuring its future?
Clearly, the new NASA administrator [Jared Isaacman] has taken a different look at the whole space program, which will impact us. We’re building up the Artemis III rocket. As you mentioned, we had flawless execution on the Artemis II launch. We’ll see where it goes, because it’s a combination of the rocket and the other capabilities that are needed with the lunar lander and all those other things that need to be done.
Boeing reacquired aerostructures supplier Spirit AeroSystems last December, 20 years after it was spun off. You recently went to Wichita and announced $1 billion in investments but did not elaborate.
The investment has two major parts over three years. One is investing in training of our people, and the other is in capital and facilities. We knew as part of our acquisition that there were areas that have been starved for investment. So we’re making the necessary investments to ramp up production and improve quality across the board.
Will that include additional facilities for B-21 production?
No comment on B-21.
One of your early moves as CEO was to sell off most of the digital business in the Boeing Global Services portfolio. In hindsight, was that the right thing to do?
I have no remorse. It certainly helped us through our liquidity and cash challenges, [and] we retained all the strategic things we felt were needed for next-generation airplane capabilities.
How is the culture different at Boeing from when you took the helm, and what is the evidence that change is underway?
It’s remarkable how fast we’ve made change, and we’re measuring it in a couple of ways. One is through a survey of our employees that benchmarks how we’re doing against our industry peers. The last survey results showed significant improvement in every area. You can feel it. If you go out on the production line, there’s a spring in people’s step. They’re clearly focused on quality, safety and doing the right thing. I think we’ve set the right tone, they believe it, and the organization is getting wrapped around that.
We also changed our performance management system—how you get a performance review and evaluate people. Fundamentally, it’s about being more transparent, working better across organizational boundaries, listening and letting people speak up. I think we’re making great progress. You’re never done, but it’s probably going faster and better than I would have guessed 22 months ago. People said, “Kelly, this is going to take forever. It’s 180,000 people. You’re not going to be able to get this change that fast.” And I said, “Well, we’ll see.”
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