Boeing (BA.N) CFO Brian West said on Wednesday the company is concerned about how President Donald Trump's tariffs will constrain the availability of parts from its suppliers, although he said the U.S. planemaker has enough inventory for now.
West, who was speaking at a Bank of America industrials conference, also said the company expected to take a one-time hit of $150 million to its first-quarter profit. The company's balance sheet has suffered from low deliveries of commercial jets and cost overruns on fixed-price contracts for its defense and space division.
Boeing's cash flow could improve in the first quarter by "hundreds of millions" of dollars, he said.
Tariffs will not likely dampen demand for the company's jetliners, he said. Boeing has an order backlog of over 5,000 planes, most of which are 737s. Deliveries of the single-aisle jet in March should match February, when it delivered 32 of the jets, he said.
The company continues to make progress stabilizing 737 and 787 Dreamliner production, both of which have been dogged by quality and supply chain problems, and remains on track to increase monthly output this year of the MAX from the mid-20s now to 38 planes and the Dreamliner from five to seven jets per month, West told investors.
Deliveries of its KC-46 tanker military aircraft were recently halted by the U.S. Air Force after cracks were discovered in parts of the wings, of two aircraft awaiting delivery. West told investors that Boeing is making progress on resolving the problem, deliveries for the year should not be affected and the halt will not result in a charge against its profit.
Boeing will not be significantly affected this year by a fire at a SPS Technologies plant, which makes 10% to 15% of fasteners for the aerospace industry, he said, adding that the company is assessing the impact on its suppliers.
The company is trying to sort out how to prevent longer-term constraints on the fasteners supply, he added.
