787 deliveries in September set to slow down ahead of 3rd quarter end

787 deliveries look to slow down this month compared to the 13 airframes handed over in August.  So far in September, Boeing has delivered 3 787s and I project that there will be 7 to 8 more deliveries by month’s end.  Again the two 787-8 for Kenya Airways are sitting in storage this time in Everett to where they were recently ferried.  The windows and doors are sealed indicating a long period of storage.  It seems they won’t be going anywhere soon.  Another 787-8 for PrivatAir is also still waiting to be delivered but the reason for the delay is unknown while for Kenya Airways it’s the lack of financing to complete the purchase coupled with the closure of the Ex-Im Bank (thank you US Congress).  What is unknown is how many other future 787 deliveries may be impacted by Congress’ refusal to renew the bank’s charter and allow it to finance foreign purchases of US made products.

Notable deliveries this month include the first 787-9 to British Airways and Xiamen Airlines’ final 787-8.  United should also be receiving 2 787-9s and the recently unveiled Star Wars 787-9 for ANA will also be delivered by the end of the month.

Monthly 787 Deliveries by Model

Boeing is now just starting to deliver more 787-9s than 787-8.  In September, I expect that Boeing will deliver 6 787-9 and 4 to 5 787-8.  The 787-9 to 787-8 delivery ratio will only get larger as time wears on due to the large number of 787-8s already delivered without additional orders to increase the -8 order backlog.

Looking at future deliveries, one cannot help but notice that certain airlines will get a majority of their 787 fleet delivered in short order.  For example, British Airways will receive 16 of the 22 787-9 over the next 13 months starting this month.  American Airlines, who took it's first 787-8 in January 2015 will have 17 in its fleet by the end May 2016.  United took it's first 787-9 in September, 2014 and should have all 18 aircraft in their fleet by the end of June 2016 a period of 21 months.  Virgin Atlantic has 17 787-9 on order and has 7 in their fleet already.  They will have 13 aircraft by the end of June 2016 also a period of 21 months from the time they took first delivery.  Boeing large and important clients are taking on the new aircraft in significant quantities as they look to renew fleets, reduce fuel and maintenance costs, and supply a better product to their customers...despite 9 abreast seating.  Other airlines are in no rush, for example, Etihad has 41 787-9s on order and has taken delivery of 5 this year and will take another 5 next year.  A very slow process compared to British, American, United and Virgin.  Deliveries in 2017 will look very interesting but I can see Air France and KLM getting much of their fleets filled out during that time.

787 Full Production Table

787 Current Production Table

Delivered 787 List

787 Production and Delivery Trends

787 Monthly Delivery Tracking

Current 787 Operators

Total 787 Deliveries By Customer
2015 Projected Operator Deliveries
2015 Projected Customer Deliveries

Boeing delivers 14 787 in August. On pace to exceed their 787 delivery guidance

Boeing is on pace to exceed their guidance of at least 120 787 deliveries in 2015.  As of the end of August, Boeing has delivered 90 787s with 14 air frames being handed over to customers in the past month.  To date, Boeing has delivered 318 787s since program deliveries began 4 years ago.

August ended with a flurry of deliveries, with 6 aircraft being delivered in a span of 3 days (the 28th to the 31st).  Counted in this total is ZB001, the first 787-9 built delivered to Air New Zealand and Thai Airways final 787-8 leased from AerCap.  Of the 14 delivered, 8 were 787-9 and 6 787-8; this marks the first time that 787-9 deliveries exceeded those of the -8.  I expect this to continue for the foreseeable future.  One aircraft, the 3rd 787-9 for Vietnam Airlines has been delivered but is not due to leave Everett until later in September.

For September, we're looking at as many as 13 deliveries and this list does not include deliveries to PrivatAir and Kenya Airways.  The aircraft deliveries to Kenya Airwyas is being held up by financing, mainly the lack of Ex-Im financing since Congress had let the Export-Import bank charter expire.  These aircraft are being stored at Everett with PrivatAir flying to Everett on Aug. 30th and the two Kenya jets flown to Everett on today, September 1st.  The two Kenya airplanes are being stored on the runway storage at Paine.  PrivatAir may be delivered soon as I was told by David Wren that Boeing ferried it to Everett so that the customer wouldn't fly it away in the middle of tropical storm Ericka.  However, the failure of Congress to renew the Export-Import bank may cost Boeing more 787 deliveries in the future.

Boeing has to deliver an average of 7.5 787 each month until the end of the year but it is still my belief that they can deliver 130 to 135.

787 Full Production Table

787 Current Production Table

Delivered 787 List

787 Production and Delivery Trends

787 Monthly Delivery Tracking

Current 787 Operators

Total 787 Deliveries By Customer
2015 Projected Operator Deliveries
2015 Projected Customer Deliveries

Boeing 787 deliveries reach over 300; posts 12 deliveries in July

Over 4 years ago the 787 program was starting to emerge from most of the issues that had plagued the program since 2007. The first delivery was right around the corner to ANA. A little less than 4 years after program deliveries began, a time when Boeing was barely reducing 2 787s each month. Now Boeing has reached 300 deliveries coming from 2 different production facilities running at 10 per month for 2 different models of the 787.  Boeing announced #300 though Randy's Journal, but they won't name the carrier.  It's possible that it was ANA but that is speculation on my part.

Boeing's 300th 787 delivery come amidst a drive to increase the delivery rate in the third quarter.  I'm not sure which airline accepted delivery of number 300 but it is either ANA, United Airlines, Etihad or Air Canada.  Through July 31st Boeing has delivered 304 787s, 76 in 2015 and 12 in the month of July.  The aircraft maker also rolled out 11 787s from its factories; 7 from Everett (including the surge line in 40-24) and 4 from Charleston.  11 787s starting final assembly in July with 5 on the main Everett line in 40-26, 1 going to the surge line in 40-24 and 5 in Charleston.

Production efficiency improved this month, particularly at Everett as 9 Everett 787s were delivered vs, 7 rollouts.  Charleston was hurt because of the delayed delivery of the two Kenya Airways jets.  Their efficiency number was not as good given the 3 deliveries vs. 4 roll outs.  Overall the 787 efficiency was .92 a good number but could have been better if Kenya was ready to take its 2 remaining 787s.

July deliveries would have been higher but for Kenya Airways and PrivatAir deferring the delivery of  3 787-8 which are ready to be handed over.  PrivatAir's delivery now looks to be in August and the two Kenya Airways may be handed over in September.

Looking forward, Boeing is planning for 15 deliveries including the PrivatAir delivery.  6 airplanes slated for August delivery have yet to take their B-1 flights including 2 787s at Charleston.  Only 4 are ready for the August delivery but that will, of course, change over the next couple of weeks.

787 Full Production Table

787 Current Production Table

Delivered 787 List

787 Production and Delivery Trends

787 Monthly Delivery Tracking

Current 787 Operators

Total 787 Deliveries By Customer
2015 Projected Operator Deliveries
2015 Projected Customer Deliveries

787 July 2015 Mid Month Update

Now that the second half of the year is underway, we should expect to see some changes in the 787 program the most visible of which is the production taper of 787 temporary surge line in Everett.  Last month there were 3 787s loaded into the Surge position 1 to start final assembly.  Starting this month Boeing will load only one 787 into the surge line in building 40-24 and that will come at the end of the month for the next four months.  40-24 is going to be a very lonely place until 777X production get started in three years.

The 2 787s from surge production are being allocated one each to the main lines in Everett 40-26 and North Charleston 88-30.  In fact North Charleston production is already very busy with 8 airplanes on the final assembly floor and another 6 on the flightline.

Boeing can deliver a total of 12 787s this month,  8 787-8 and 4 787-9.  I expect that there can be up to 6 deliveries in July from North Charleston including one 787-8 for PrivatAir that was assembled At Everett but ferried to South Carolina.  One 787-8 for Kenya Airways was supposed to be delivered in June but was held up at the request of the customer for unknown reasons.  Sources say that this airplane should be delivered this month which would be the 6th delivery out of North Charleston.  Some notable deliveries would include the first 787-8 for Scoot and Vietnam's first 787-9 as well as the aforementioned first 787-8 for PrivatAir.  Boeing has already delivered 2 787, both to Jetstar.

Thus far through today, July 15, 2015, Boeing has delivered 2 787s this month, 66 in 2015 and 294 total since deliveries began in September 2011.

There was some good news and some potentially not so good news for the 787 program.  First the not so good news.  Zodiac Aerospace has more trouble again when an explosion occurred (a possible chemical explosion) at its interior fabrication plant in Newport, Washington.  Both Boeing and Airbus are reviewing the impact to their production lines but I do believe that this will impact Boeing more than Airbus.  It is unclear if it will impact 787 deliveries at this point.

The good news for the 787 program is that the 787-10 has completed its CDR (critical design review) and is on its way to having 90% of detailed engineering drawings completed by the end of the year.

787 Full Production Table

787 Current Production Table

Delivered 787 List

787 Production and Delivery Trends

787 Monthly Delivery Tracking

Current 787 Operators

Total 787 Deliveries By Customer
2015 Projected Operator Deliveries
2015 Projected Customer Deliveries

787 Build Location By Operator 
787 Build Location By Customer

787 May Month End Review

Boeing had a pretty good month delivering 12 787s to customers.  Among the highlights is the 13th and last 787-8 for TUI Travel and 2 787-8 for American Airlines.  It does seem that for American the Zodiac seat issue is behind them but it appears the same cannot said for Etihad.  They have 3 787-9s waiting on the flightline, only 1 of which has flown.  Boeing achieved and production efficiency ratio of 0.83 (roll out of 10 787s vs. delivery of 12 aircraft).  Again anything lower than 1 is a good sign that Boeing is moving to reduce the backlog of 787s and make the production, testing and delivery process more efficient.  Overall production efficiency is just under 1 at 0.98 with Charleston being a little bit more efficient (0.94) versus Everett (1.0) thus far this year.

One notable achievement is that Boeing was able to deliver a 787-9 to Scoot in under 70 days from the time the aircraft started final assembly.  ZB130 (LN 308, 9V-OJD) started final assembly on March 23, 2015, rolled out on April 22nd, 2015, had its first flight on May 6, 2015 and was delivered on May 29th, 2015.  A total of 67 days.  This may well have been a test of new processes in the production system designed to cut build and delivery time significantly especially before the two main 787 lines in 40-26 and 88-30 go up in rate by the end of this year.  Eventually both lines are to be producing 7 aircraft each by the end of the decade but the upshot is that Boeing needs to cut the total time from the start of final assembly to delivery.

Boeing started final assembly on 10 787s including a 787-8 BBJ for the Sultan of Brunei and Air Canada's first 787-9.  Of these 10, 4 are 787-9 and 6 are 787-8.  Over the course of the next few months I expect that this ratio will change as the number of 787-8 remaining to be built (barring new orders) decreases.  If Boeing is to sell more 787-8s, I am starting to believe that they will need to look to reduce weight of the aircraft as well as introduce other fuel saving measures including urging GE and Rolls Royce to improve the fuel burn of their engines.  Roll Royce seems to be on that path with the Trent-1000-TEN.

Boeing rolled out 10 787s including the first 787-8 for PrivatAir.  Of the 10 rolled out, 5 are 787-8 and 5 are 787-9.

For next month Boeing should deliver 14 787s prior to the end of the second quarter.  Of these 14, 9 should be 787-9 including the three aforementioned Etihad airplanes.  Air India's final 787-8 (assuming they convert the remaining 6 into 787-9s) will also be delivered in June as will Japan Airlines' first 787-9 which coincidentally is the first of the 3 787-9 test airplanes to be delivered.  Another notable delivery is the first 787-9 for Vietnam Airlines which is rumored to be performing the flying display at this year's Paris Airshow in mid June.  Lastly, the penultimate 787-8 for both Kenya Airways and Xiamen Airlines will be delivered in June.

787 Full Production Table

787 Current Production Table

Delivered 787 List

787 Production and Delivery Trends

787 Monthly Delivery Tracking

Current 787 Operators

Total 787 Deliveries By Customer
2015 Projected Operator Deliveries
2015 Projected Customer Deliveries

787 Build Location By Operator 
787 Build Location By Customer

1st Quarter 2015 787 Report

UPDATE: Ok so moments after posting this Boeing put out it's O & D numbers for the 1st quarter.  There were 2 unidentified orders for 787-9 one for 6 (probably Oman Air) and one for 24 (wide open on the customer but could be Hainan plus 6 additional 787-9 taken on lease from ALC).  Boeing did deliver 30 787s per my earlier comments below.  Boeing total 787 order book is now over 1,100 and for the first time the total number of 787-9 orders (496) exceeds the total number of 787-8 orders (467).  This is trend I expect to continue as future orders will tend towards the 787-9 and 787-10 as well as conversions of some existing 787-8 orders to the 787-9 or 787-10.

The 1st quarter has come to an end during which Boeing has delivered 30 787s.  This pace keeps them on track for 120 deliveries by the end of the year.  In March, Boeing delivered 11 787s including the first aircraft from a lot of early production aircraft known as the "terrible teens."  This aircraft is ZA841 (LN 11, N507BJ) was sold to Korean Air to be used as a VIP transport for the South Korean government.  This aircraft was flown to Grant County International Airport for some unidentified purpose.  I can only speculate that it is there for storage, pilot and ground crew training, or interior installation.  Boeing has now delivered a total of 258 787s of which are 238 are 787-8 and 20 are 787-9.

What was also interesting about March deliveries was the number of 787-9 (5) delivered vs. the 787-8 (6), almost half of the delivery totals for the month.  For the quarter, Boeing delivered 10 787-9s vs. 20 787-8s.  This will be an important metric to watch as production cost come down on the 787-9 (and the 787 program as a whole) the margins on these larger version will be higher vs. the 787-8.  The more of these airplanes that are delivered the better Boeing's financial results will look.  It is expected that the 787-9 (and the 787-10) should be more profitable to the company to produce than the 787-8.  This profitability will be even more pronounced as Boeing has delivered over 50% of the 787-8 ordered thus far while only delivering less than 5% of the total 787-9 ordered to date.  Boeing has delivered 24% of the total 787 orders thus far.

Boeing booked 3 unidentified orders in March and also announced the firming of ANA order for 3 787-10.  I'm not sure if the two are one in the same.  There are more potential orders on horizon as Hainan Air, Oman Air and QANTAS may add to their existing orders an in significant numbers.  Hainan is talking about ordering 30 787-9.  I believe that this order may be a mix of leased aircraft as well as direct purchase from Boeing.  There is one 787-9, ordered by Air Lease Corp., that will be leased to Hainan Air (LN 430).  Oman Air has 3 787-8 and 6 787-9 on order according to the carriers CEO while Boeing's Order and Delivery website still lists their order as 6 787-8s.  Oman Air is expectign to take delivery of the 2 787-8s this year and the 787-9s next year.  The carrier is envisioning a widebody fleet of 25 all of which may be 787s though they do plan to evaluate the A330NEO.  QANTAS is already taking 787s for its Jetstar subsidiary since 2013 but they still hold 50 purchase rights which have been moved back over the last few years due to the carrier's poor financial health.  Now that QANTAS has regained a firmer financial footing, there is serious talk of exercising those 50 rights, the first of which calls for a delivery in 2017.  That mean that QANTAS needs to start firming these rights late this year or lose them and the valuable early delivery slots that Boeing can use for new or existing customers.  Turkish Airlines may be another carrier that may order the 787 this year through their timing is nebulous as is their intentions.

In April I am projecting 14 787 deliveries including Japan Airlines' first 787-9 (the 3rd 787-9 flight test airplane), and a whole gaggle of 787-8 for American Airlines that have been delayed because of the continuing saga at Zodiac.  Norwegian's final direct purchase 787-8 should also be delivered this month as well.

As far as rollouts are concerned, look for Vietnam Airlines' first 787-9 to come out of 40-26  as well as Air India's potentially final 787-8 emerging at the end of April from 40-26.  Xiamen's penultimate 787 will emerge from Charleston's 88-30 final assembly building around the third week of April. I believe we should see 5 787-8 and 5 787-9s rolling out of Boeing's factories this month. The only notable 787 that will start final assembly this month is the first 787-8 for PrivatAir.  Boeing will start assembling 6 787-8s and 4 787-9s in April.

787 Full Production Table

787 Current Production Table

Delivered 787 List

787 Production and Delivery Trends

787 Monthly Delivery Tracking

Current 787 Operators

Total 787 Deliveries By Customer
2015 Projected Operator Deliveries
2015 Projected Customer Deliveries

787 Build Location By Operator 
787 Build Location By Customer

2015 Look Ahead for the 787

With 2014 firmly in the rear view mirror, we can start looking ahead at what's next for the 787 program.

According to sources, Boeing is planning for 138 deliveries.  Given they just finished a year where program execution was not good, the prospect of Boeing hitting 138 deliveries is a little far fetched.  They would need to execute final assembly perfectly and drive down  assembly to delivery times.  In December, if the delivery outliers (namely aircraft going to Avianca, Etihad and Azerbaijan Airways) are taken out, then Boeing was able to assemble and delivery the 787 at an average of 107 days.  This is much to long if they intend to increase the number of deliveries in 2015.  In my view Boeing should be able to deliver around 125 to 130 787s.  I'll track their progress vs. the 138 plan deliveries and their delivery guidance for 2015 as it can help gauge how well the production system is working especially in terms of their internal goals.

2015 will be notable year for a few reason.  First there will be customers taking deliveries of their first 787s as well as existing operators taking delivery of their first 787-9.  Last year Boeing managed to deliver 10 787-9.  In the new year Boeing expects to deliver a significant number of the enlarged version of the aircraft.  The expectation is for 64 deliveries of the 787-9 which will help profitability of the 787 program overall.

Here is a list of operators who will be receiving their first 787 this year:

1st Time 787 Operator

American Airlines

Kalair (Bermuda)

Korean Air

Oman Air

PrivatAir

KLM - Royal Dutch Airlines

Saudi Arabian Airlines

Scoot Pte Ltd

Tuifly Nordic

Vietnam Airlines

An a list of operators who will be receiving their first 787-9:

1st Time 787-9 Operator

Air Canada

British Airways

Japan Airlines

Kalair (Bermuda)

LAN

KLM - Royal Dutch Airlines

Saudi Arabian Airlines

Scoot Pte Ltd

Vietnam Airlines

Obviously some of these deliveries had rolled over from last year, namely American Airlines, Korean Air, and Scoot.

However, the overriding theme of the year will not just be making timely deliveries but also trying to further reduce the cost of the 787 program and that starts with reducing deferred production costs and trying to cap it at the current $25.2bn level.

Finally here's a projection of the 2015 operator deliveries:

Projected 2015 Deliveries (Operator)	Expected Total Deliveries	Actual Deliveries	Exp.Pre-L/N 66 Deliveries	Actual Pre-L/N 66 Deliveries	Expected 787-8 Deliveries	Actual 787-8 Deliveries	Expected 787-9 Deliveries	Actual 787-9 Deliveries
Aeroméxico	3				3
Air Canada	5				2		3
Air India	4				4
Air New Zealand	3						3
American Airlines	12				12
ANA	10				3		7
Arke	1				1
Avianca	3				3
British Airways	5						5
Ethiopian Airlines	3				3
Etihad Airways	4						4
Hainan Airlines	2				2
His Majesty The Sultan's Flight	1				1
Japan Airlines	6				4		2
Jetstar	4				4
Kalair (Bermuda)	1						1
Kenya Airways	3				3
KLM - Royal Dutch Airlines	2						2
Korean Air	1		1		1
LAN	7						7
Norwegian Air International Ltd	1				1
Oman Air	2				2
PrivatAir	1				1
Qatar Airways	7				7
Royal Air Maroc	1				1
Saudi Arabian Airlines	1						1
Scoot Pte Ltd	10				4		6
TBD	3		3		3
Thai Airways International	2				2
Thomson	1				1
Tuifly Nordic	2				2
United Airlines	11						11
Vietnam Airlines	5						5
Virgin Atlantic Airways	7						7
Xiamen Airlines	4				4
Total	138	0	4	0	74	0	64	0

And a list of 2015 customer deliveries:

Projected 2015 Deliveries (Customer)	Expected Total Deliveries	Actual Deliveries	Exp.Pre-L/N 66 Deliveries	Actual Pre-L/N 66 Deliveries	Expected 787-8 Deliveries	Actual 787-8 Deliveries	Expected 787-9 Deliveries	Actual 787-9 Deliveries
AerCap	12				5		7
Aeroméxico	1				1
Air Canada	5				2		3
Air India	4				4
Air New Zealand	3						3
American Airlines	12				12
ANA	10				3		7
Avianca	3				3
BBJ	1				1
British Airways	5						5
CIT Leasing	2				2
Etihad Airways	4						4
Hainan Airlines	2				2
Japan Airlines	6				4		2
Kalair (Bermuda)	1						1
Kenya Airways	3				3
Korean Air	1		1		1
LAN	2						2
Norwegian Air International Ltd	1				1
Oman Air	2				2
PrivatAir	1				1
QANTAS	4				4
Qatar Airways	7				7
Royal Air Maroc	1				1
Saudi Arabian Airlines	1						1
Scoot Pte Ltd	10				4		6
TBD	3		3		3
TUI Travel	4				4
United Airlines	11						11
Vietnam Airlines	5						5
Virgin Atlantic Airways	7						7
Xiamen Airlines	4				4
Total	138	0	4	0	74	0	64	0

787 Current Production Table

Delivered 787 List

787 Production and Delivery Trends

787 Monthly Delivery Tracking

Current 787 Operators

Total 787 Deliveries By Customer
2015 Projected Operator Deliveries
2015 Projected Customer Deliveries