By David Shepardson

WASHINGTON (Reuters)

The head of the Federal Aviation Administration (FAA) told a U.S. Senate panel on Wednesday that Boeing (NYSE:BA) must address a series of safety issues before increasing 737 MAX production. FAA Administrator Mike Whitaker capped production at 38 MAX planes per month in January after a door panel missing four key bolts flew off an Alaska Airlines 737 MAX 9 in midair.

“They cannot grow to where they need to grow without” making broad safety improvements in six key categories and maintaining those improvements at higher production rates, Whitaker stated during a Senate Permanent Subcommittee on Investigation hearing on FAA’s oversight of Boeing. “If they don’t do that, they don’t grow, and if they don’t grow, they’re not going to be able to achieve profitability.”

Boeing shares fell 2.3%. The company did not immediately respond to a request for comment on the hearing.

Senator Richard Blumenthal, chair of the committee, noted that Boeing produced 52 planes per month in 2018, but production has now slid below 38. He questioned whether lowering the cap would be more effective.

“Boeing has put profits and speed of production ahead of quality and safety, and ultimately that failing is at the core of its current difficulty,” Blumenthal added.

According to a Reuters report on Sept. 10, Boeing informed suppliers it would delay a key production milestone for its 737 MAX by six months, suggesting struggles to boost production of its best-selling jet.

Whitaker indicated that “Boeing is quite aware that they’re not going to increase production on any of these aircraft” until they meet six key metrics or are in the “green.”

When asked if the production cap applies to other Boeing airplanes like the 787, Whitaker described it as a “fluid situation” but emphasized, “If you had a robust safety management system, you wouldn’t increase production unless you were in the green on everything. So that’s our expectation across the fleet.”

Boeing’s latest 737 supplier master schedule calls for MAX output to reach 42 a month by March 2025, compared to a previous target set for this month. However, Boeing has not changed its official target, which remains 38 MAX jets a month by the end of 2024, an increase from roughly 25 jets a month in July.