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Aircraft Production Recovery Faces Ongoing Supply Chain Constraints

Aircraft production is gradually stabilizing after several years of disruption, but industry leaders say significant challenges remain across the global aerospace supply chain.

Speakers at ISTAT Americas in San Diego on 8-10 March 2026 highlighted progress in restoring production rates and improving manufacturing quality while acknowledging that supplier shortages, labor constraints and certification bottlenecks will likely persist for several years.

Stabilizing Production at Boeing

A key focus of the discussion was the progress Boeing has made in stabilizing production of the 737 program following quality issues and supply chain disruptions in recent years.

During a session titled “Renton Report: Navigating 737 Program Challenges and Planning for the Future,” Katie Ringgold, vice president and general manager of the 737 Program at Boeing, described how the company deliberately slowed production to address manufacturing challenges.

“In the early days, I needed to calm everyone down and give them a simple plan forward,” Ringgold said.

The company reduced production rates and used one of its three final assembly lines at the Renton facility to perform rework on previously delivered fuselages.

“We elected to slow down our factory,” she said. “[This was] very painful in the early days, but it gave us time to rectify the inventory we had and get the production line ready again.”

Since then, Boeing has resumed production at 42 aircraft per month, a level the company has maintained since November.

Looking ahead, Boeing is preparing to gradually increase output while working closely with regulators.

“The process from 38 to 42 was a new process,” Ringgold said, noting that the FAA now plays a larger role in approving production increases.

As Boeing prepares to raise production further, the company is also expanding manufacturing capacity with a fourth assembly line known as the north line, which is expected to begin production once new workers are hired and trained.

“We’re excited to think about the fourth production line,” Ringgold said.

Supplier Recovery Remains Uneven

Despite improvements in aircraft production, the broader supply chain continues to face structural challenges.

During a panel discussion titled “The Supply Chain Disruption – A Never-Ending Story?”, industry analysts and consultants noted that supplier recovery has been uneven across different parts of the aerospace ecosystem.

“In general, it’s getting better,” said Ronald Epstein, managing director and senior research analyst at Bank of America Securities. “However, it depends where you look.”

While some suppliers have recovered from pandemic-era disruptions, others — particularly smaller companies — continue to struggle with workforce shortages and financial pressures.

According to Kevin Michaels, managing director at AeroDynamic Advisory, many lower-tier suppliers lost experienced workers during the pandemic and have struggled to rebuild that expertise.

“They cut into muscle during COVID,” Michaels said. “Training and keeping skilled people is hard.”

These challenges are especially pronounced among Tier 2 and Tier 3 suppliers, many of which operate with limited financial resources.

“Eighty percent of them are under $50 million in revenue,” Epstein said.

As production rates increase, these smaller suppliers must balance the cost of expanding capacity with the risk of fluctuating demand.

Interior Components Create Unexpected Bottlenecks

One of the most persistent supply chain constraints today involves aircraft interiors.

According to Gary Weissel, managing officer at Tronos Aviation Consulting, shortages of interior components — from seating systems to small structural parts — are delaying aircraft deliveries and refurbishment programs.

“Interiors is getting worse not better,” Weissel said.

Airlines are increasingly demanding customized cabin products, adding complexity to the production process. At the same time, certification requirements for interior components have become more demanding.

“It could be a bracket and you’re looking at 180 to 300-plus days,” Weissel said.

The challenge is compounded by the limited number of suppliers capable of producing certified interior components and the difficulty of switching suppliers once a product has been approved for use.

“You don’t just come up with a new seat and suddenly have 50 orders,” Weissel said.

Certification constraints have also become a growing issue, particularly as experienced personnel leave the industry.

“There are only a handful of people who certify interiors in the U.S.,” Weissel said.

Structural Pressures in the Supply Chain

Several panelists argued that structural changes within the aerospace supply chain have contributed to the current challenges.

Over the past two decades, aircraft manufacturers have increasingly outsourced production and placed significant cost pressure on suppliers in an effort to improve margins.

According to Adam Pilarski, president of AVITAS, those decisions ultimately weakened parts of the supply chain.

“Manufacturers wanted to outsource everything, even risk,” Pilarski said.

The result, he argued, was a supplier ecosystem that struggled to maintain profitability while meeting increasing production demands.

“Suppliers don’t deliver while losing money,” Pilarski said.

Today, aircraft manufacturers are increasingly bringing certain capabilities back in-house while seeking ways to stabilize the supplier base.

A Long Road to Full Recovery

Despite progress in production rates and supplier performance, many industry participants expect supply chain challenges to persist for several years.

Interior manufacturing and certification, in particular, may take longer to stabilize due to limited engineering resources and growing demand for customized cabin products.

“If we don’t have another Black Swan event,” Weissel said, “it’s several years out, five or six.”

In the meantime, aircraft manufacturers, airlines and lessors are adapting to an environment where supply constraints remain a defining feature of the market.

Even as production rates increase, the aerospace supply chain continues to rebuild the workforce, capital and operational capacity needed to support the next phase of industry growth.

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