Wednesday, April 24, 2013

Boeing gives upbeat assessment of 787 during earnings call

 During the 1st quarter 2013 earnings call, Boeing CEO Jim McNerney gave an upbeat assessment of the 787.  Despite the lack of 787 deliveries in the past quarter Boeing's earnings managed to stay strong given increased deliveries of the 737 and 777.  Now that the FAA has given approval to the lithium ion battery fix Boeing is prepared to resume deliveries around early May.

Among the information on the 787 that was passed along during the call were:

  • Installation has begun on 10 in service 787 and 9 production aircraft thus far.
  • Boeing initiated  a rate break to 7 aircraft/month.
  • All engineering work on the 787-9 is completed.  Final assembly will start by mid year (I'm expecting very late May. First flight this fall and first delivery in the first half of 2014.
  • 787-10 interest remains very high and Boeing anticipates formal launch "soon."  With delivery slots sold out Boeing may have to look at a further increase in the 787 production rate beyond 10/month and this issue is currently under evaluation.  The rate must be stabilize at the 10/month before consideration of a rate increase beyond that rate.
  • Travelled work is close to 0 and part shortages are minimal.
  • Most of the battery work should be completed by mid May on the in service 787s.
  • The per unit cost of producing each 787 has come down 60% from LN 8 to LN 100.
  • Boeing is maintaining its delivery guidance of more than 60 787s this year and said that 15% to 20% will be delivered in the second quarter.
Assuming a delivery goal of 65 787s this year this would mean that Boeing is planning to deliver between 10 and 13 787s by the end of June. It is possible to get a better idea of the total deliveries for this year when the number of deliveries during the 2nd quarter is known.


 






6 comments:

TurtleLuv said...

I'd love to know what's going on with lines 20 and 21. They've been in the EMC for over half a year now. Is it really gonna take 6+ months for each of the early frames to finish rework? Is it really cost effective to rework these frames or would it be cheaper just to dump them and build a new one? Or do they have one guy working part time per frame? 6 months seems like an awfully long time, when they're building new planes in, what like two weeks? a month max? maybe a couple months if you count the whole pipeline i suppose.

Cedarglen said...

As a stockholder and life-long fan of Boeing, I'm delighted to learn that the 787 Dreamliner is being retro-fitted and will soon return to regular service. Completing their proposed deliver schedule for 2013 will require a LOT of work at EDC, but they will manage it with grace. Many of the festivities may be scaled back a bit, but the Folks back Home want to see functional airplanes, not video of key-swapping parties. As the -9 enters production, Boeing still has a full plate, but they have the resources to make it work. And yes, let's h ope that the 787 does not experience any more 'major' issues; another fleet-wide grounding could - would kill this airplane.

Bernie said...

Hey!!

Firstly, great blog, love it! It is a great resource!

Just wondering if you know why/when the first Qantas/Jetstar delivery will start?

Also, the first B789 is already being 'put together' so to speak, so parts have been delivered (thanks Jon Ostrower) http://www.flickr.com/photos/flightblogger/8679419302/

Uresh said...

Deliveries have been pushed back and Boeing themselves are still trying t figure the schedule so right now it's unknown. Delivery of 787-9 parts to Everett has not taken place yet. Jon's photos are from Charleston, SC not Everett.

Karel S said...

@TurtleLuv rework on those (very) early builds takes about 8 months.

Karel S said...

@TurtleLuv Speaking of the devil, either LN20 or 21 finished change incorporation, see http://www.flickr.com/photos/moonm/8694326317/