Titanium Producers ATI and Howmet Adjust Outlook Amid Boeing Strike Disruptions

Impact of Boeing Strike on Titanium Supply Chain
The ongoing Boeing strike has caused major disruptions across the aerospace industry, particularly affecting titanium suppliers ATI and Howmet Aerospace. The strike, initiated on September 13, involved over 32,000 Boeing machinists and halted the production of key aircraft models such as the 737 MAX, 767, and 777. As Boeing’s operations were suspended, the titanium supply chain faced significant delays, particularly in deliveries and shipments that affected both ATI and Howmet’s output. This disruption was compounded by Boeing’s pre-existing struggles to meet production goals for the 737 MAX, which was already operating below its planned output before the strike began.

Financial Impact: Adjusted Earnings and Revenue Projections
Both companies have adjusted their financial projections for the next two quarters in response to the strike’s impact. ATI revised its earnings guidance for 2024 to a range of $700 million to $710 million, down from an earlier estimate of $720 million to $750 million. Similarly, Howmet Aerospace lowered its revenue forecast for 2024 to $7.41 billion, slightly below the initial projection of $7.44 billion. Despite these downward revisions, Howmet showed strong financial performance for Q3 2024, reporting a 77% year-on-year increase in profit to $331 million and an 11% rise in revenue to $1.8 billion. In contrast, ATI saw a modest 1% increase in profit, totaling $83 million, while its revenue declined by 4% to just under $1.1 billion.

Supply Chain Recovery and Future Expectations
Both companies are cautiously optimistic about a gradual recovery in the aerospace supply chain as Boeing works to stabilize its operations. Boeing’s efforts to retrain workers and ramp up production will be critical for suppliers like ATI and Howmet, who are closely monitoring the situation. ATI expects modest growth in the upcoming quarters, while Howmet is aligning its forecast with Boeing’s adjusted production levels, projecting a steady return to normal operations by 2025. Howmet’s ability to weather this disruption while still posting strong profits highlights its resilience in the face of supply chain challenges.