Howmet Aerospace Adopts Conservative Outlook Despite Boeing's 2025 Production Targets

Howmet Aerospace

Supply chain volatility drives cautious planning by leading titanium parts supplier

Howmet Aerospace, a leading titanium melter and aerospace component manufacturer, is tempering its expectations for Boeing’s 2025 aircraft build rates. While Boeing projects an aggressive ramp-up, Howmet is planning based on more conservative assumptions, citing ongoing inventory corrections and supply chain uncertainties.

Boeing has forecasted a significant increase in the production of its 737 MAX, aiming to reach 38 aircraft per month in the second half of 2025, with a further potential rise to 42 per month by year-end. Despite this, Howmet’s CEO John Plant stated the company is operating under assumptions of 25/month for the 737 MAX and 6/month for the 787 Dreamliner for the full year.

Inventory normalization and supply bottlenecks shape Howmet’s cautious approach

Howmet attributes its reserved stance to Boeing’s own inventory normalization efforts. CFO Brian West previously emphasized the need to reduce buffer stock, which could delay near-term orders. The backlog of titanium-intensive components such as heat exchangers and seating certifications for the 787 also contributes to the uncertainty.

While other aerospace suppliers have raised forecasts based on Boeing’s outlook, Howmet is hedging its bets on demand driven more by spares and aftermarket services. The company noted spares made up 17% of total revenue in 2024, a share it expects to grow further in 2025 due to extended aircraft service lives and delayed retirements.

Growth expected despite production caution

Despite its conservative planning, Howmet expects to increase annual revenue to between $7.93 billion and $8.13 billion in 2025, up from $7.4 billion last year. The company anticipates sustained demand from both Boeing and Airbus, along with increased aftermarket needs, particularly for turbine blades.

Profitability remains strong, with Howmet’s 2024 net income rising 51% year-over-year to $1.2 billion, supported by a 33% increase in fourth-quarter profit. While the company is not fully aligned with Boeing’s optimism, it remains well-positioned to capitalize on gradual industry recovery.