787 Deferred Production Cost drop by $1.06 bn as Boeing prioritizes 787 sales.

Boeing reported its 2nd quarter financial performance and it seems that things are a little bleak.

First off the continued issue with the 737 MAX has Boeing considering slowing down or even completely stopping production on the aircraft until it is re-certified and back in the air.  They've been producing the aircraft and then parking them all over the Pacific Northwest.  The higher margins from the 787 program has helped partially offset the 737 MAX financial hit.

They also announced that the 777X first flight has been pushed to early 2020 from late 2019 due to the continued GE9X issues.  There is a huge amount of schedule risk in that program.

Not to mention that Airbus seems to be getting the better of them in the NMA/A321 market where Boeing has yet to launch their new widebody aircraft.

The 787 program is a bright spot as Boeing did report that the deferred production cost dropped by over $1 bn to $20.969 bn. Last quarter the deferred production cost was around $22.029 bn. The main issue for Boeing is getting more orders for the 787.  Currently the remaining backlog of 787s is 581 airplanes which is about 3.5 years of production at the current rate.  The word out on the Street is that Boeing is willing to trade away some 777X orders with Emirates in exchange for the 40 787-10 that they signed an LoI for in 2017.  Boeing did note that recent orders from Air New Zealand, Korean Air and Air Lease Corp. has bolstered the 787 skyline but they do need to make a more aggressive push for more orders or they would have to look to cutting production.  They are aiming at the widebody replacement market as a source of new orders down the road.