Buttigieg says Boeing must meet FAA quality plan before raising 737 MAX output

By David Shepardson

ARLINGTON, Virginia (Reuters) - U.S. Transportation Secretary Pete Buttigieg said on Wednesday that Boeing must meet a government mandate to address systemic quality-control issues within 90 days before it will be able to boost 737 MAX production.

Buttigieg noted that Boeing is about halfway through that 90-day clock set by the Federal Aviation Administration (FAA).

"We're not to going let them (increase production) until they have satisfied to the FAA that they can do it safely," he said at an event at Reagan National Airport outside Washington.

The FAA in late January took the unprecedented step of telling Boeing it would not allow the U.S. planemaker to expand 737 MAX production in the wake of a mid-air emergency on an Alaska Airlines 737 MAX 9.

The Justice Department has opened a criminal probe into the mid-air cabin panel blowout.

FAA Administrator Mike Whitaker told Reuters in March that Boeing is allowed to produce 38 of the 737 planes per month, but actual current production "is lower than that."

Reuters reported earlier this month that Boeing's monthly output rate fell as low as single digits in late March.

Boeing CEO Dave Calhoun said on an earnings call on Wednesday that the FAA wants a plan in 90 days "that, in essence, monitors and measures whether our production system is in control moving forward."

"90 days isn't like a wave a magic flag, and everything is great, and you guys can go from 38 to 40," he added.

Whitaker said in March that the timeline for when Boeing will be allowed to boost the 737 MAX production rate will depend on "how effectively they can implement these changes in the safety culture and bring their quality levels up to where they need to be."

Buttigieg separately acknowledged that U.S. airlines including Southwest Airlines were being impacted by the fewer number of airplanes being delivered this year by Boeing.

"This is a real issue," Buttigieg said, but emphasized that the FAA is only thinking about safety and not economic considerations in addressing the 737 MAX.

(Reporting by David Shepardson; Editing by Alexander Smith)