Boeing reports loss on Air Force One but sees progress in turnaround

Boeing reported a bigger-than-expected loss Tuesday fuelled by $280 million in additional costs in outfitting two US presidential planes, but said broad-based revenue growth showed progress after several troubled years.

The US aerospace giant scored an eight percent increase in revenues to $24.6 billion on increased commercial plane deliveries and higher volume in defense, space and security.

Boeing reported a second-quarter loss of $428 million, smaller than in the year-ago period, but bigger than projected by analysts.

The results included $280 million in losses on the VC-25B program for the presidential plane, Air Force One, which has been beset by delays and cost overruns.

The latest Air Force One expenses are for "additional production and certification resources," Boeing said in its earnings press release. The original 2018 contract was to modify and outfit two 747-8 aircraft for presidential use.

The contract aimed for initial delivery of an Air Force One aircraft by the end of 2024. The current timeframe is for delivery in mid-2028 and mid-2029.

Boeing described certification efforts for new 737 MAX and 777 planes as on track with US air regulators. Boeing has said the first of these planes -- the 737 MAX 7 -- is in the "last throes" of the process.

In early July, Boeing unveiled new 737 MAX production at a "North Line" in Everett, Washington designed to enable the company to further ramp up plane output.

In the second quarter Boeing "began transitioning production to 47" 737 jets per month, Boeing said Tuesday. The company has said the North Line will enable it to reach 52 MAX airplanes a month.

Chief Executive Kelly Ortberg said he was pleased with the company's progress. When Ortberg joined Boeing about two years ago, the company was reeling after crashes and safety problems.

"Looking back at our first half, I'm proud of what we’ve accomplished so far and how we've laid the groundwork to complete the important work still ahead of us this year," Ortberg said in a letter to employees.

"While we're making progress on our development programs, you're never done until you're done."

On Monday, the Federal Aviation Administration released a preliminary directive ordering inspections on more than 450 US 737 MAX jets over potential faulty installation of passenger seats.

The safety regulator said incorrect installation can lead seats to disengage from seat tracks, which "could result in injury to passengers and crew during an emergency landing or could block the aisle, which could slow evacuation."

Shares of Boeing rose 0.7 percent in pre-market trading.