Is there a glimmer of hope for Boeing's recovery? Report: FAA will gradually ease delivery restrictions, and a production ramp-up for the 737 MAX is in sight

The Federal Aviation Administration (FAA) is easing delivery restrictions on Boeing's newly produced aircraft, which is a positive sign for the aircraft manufacturer as it recovers from a series of crises. Boeing is expected to regain some authority from regulators to conduct final safety inspections on its 737 MAX jets.

According to informed sources, the FAA may announce this approval decision as early as Friday. Boeing employees will gradually regain safety signing authority, while FAA inspectors will still be involved in issuing airworthiness certificates, which are necessary documents for passenger flights.

The FAA is also expected to allow Boeing to increase the monthly production limit of the 737 MAX from the current cap of 38 aircraft to 42. The regulator previously imposed production limits after a panel door fell off an Alaska Airlines aircraft in mid-air, due to Boeing's excessive emphasis on production over quality.

This easing of regulatory burdens indicates that the U.S. government is increasingly satisfied with Boeing's efforts to improve its manufacturing processes, marking a gradual restoration of trust from regulators after Boeing has faced multiple crises.

Phased Return of Safety Inspection Authority

The FAA typically delegates routine inspections to aerospace manufacturers to concentrate scarce personnel resources on more critical tasks. However, after two fatal 737 MAX crashes in 2019, the regulator intensified its oversight of Boeing.

The FAA began requiring that each new aircraft produced at the 737 MAX factory in Renton, Washington, could only be inspected by agency inspectors. The federal agency expressed concerns that Boeing employees were under pressure to produce and deliver aircraft, indicating a need for closer monitoring of the manufacturing process to ensure public flight safety.

Subsequently, after a series of quality incidents, the FAA revoked similar authority for the production of the 787 Dreamliner in South Carolina. According to some informed sources, Boeing is also expected to regain relevant authority for the Dreamliner.

Production Restrictions Expected to Be Eased

This restriction means that Boeing lacks flexibility in delivering aircraft to customers and must coordinate with government employees' work schedules to obtain safety approvals. Returning some authority to Boeing can free up FAA inspectors to monitor the aircraft production process more closely, rather than focusing on paperwork at the end of the process.

According to informed sources, the FAA is also expected to allow Boeing to increase the monthly production limit of the 737 MAX from 38 to 42 aircraft. If approved to raise the monthly production to 42, Boeing has stated it will maintain that level for several months to observe any issues before increasing the monthly production by another five aircraft.

CEO Kelly Ortberg stated at an investor meeting earlier this month that there is clearly strong market demand for our product lineup, and the faster we can ramp up production, the better, but... we will not push it. If we are not ready, we will wait another month.

Gradual Restoration of Regulatory Trust

Boeing's ability to conduct aircraft safety inspections has always been a politically sensitive topic. Before the 2024 Alaska Airlines panel door incident, frontline FAA employees, managers, and some senior agency officials had hoped to return authority to Boeing According to officials from the organization at the time, the quality of Boeing aircraft had been improving prior to the incident. However, given the criticism of the FAA for inadequate oversight following various crises at the aircraft manufacturer, the return of permissions has brought complex public opinion effects.

The Alaska Airlines incident ensures that Boeing will face stricter regulatory scrutiny for a longer period. Employees at Boeing's Renton factory failed to secure the fuselage panel bolts in place before the aircraft left the site. The FAA subsequently implemented production restrictions, established key performance indicators, increased the number of inspectors at the Boeing factory, and reestablished a permanent presence.

In early September, the FAA proposed a fine of $3.1 million against Boeing due to alleged safety violations, including those related to the Alaska incident. The issues flagged by the FAA included: Boeing submitted two problematic aircraft to the FAA for final approval and failed to follow its quality system