All Things 787 Mega Update

First let me start out this update by saying that my prayers and condolences are with the victims and families of MH17.  I do hope that there is swift justice for all the responsible perpetrators of this awful crime.

Since my last blog post about 3 weeks ago there has been much activity with the 787.  Boeing posted 15 total deliveries in June and a total of 30 in the 2nd quarter.  This total included the first delivery of the 787-9 to Air New Zealand as well as delivering a 787 that completed a customers full order (China Southern receiving it's 10th 787 from an order of 10 that they placed).  Boeing has delivered 48 787s through the end of June (51 to date) and overall 787 deliveries to June 2014 stands at 162 (165 to date).

AS attention now turns to the last half of 2014, we will see the first 787-9 with GE engines delivered to United Airlines.  The first aircraft for UA, ZB167 (LN 181,N38950) performed its first flight on July 11th and is now into the F&R/ETOPs testing for the GEnx powered version of the 787-9. This aircraft should be delivered to United by the end of August.  ANA should also be receiving its first 787-9 later this month.  It will take delivery of ZB197 (LN 146, JA830A) after it had completed the F&R/ETOPs flight testing for the Roll Royce powered version of the -9.  It had to go through change incorporation and is at the final stages of production testing.

I do anticipate that Boeing can deliver around 10 787s in July including the one to ANA.  It already has delivered 3 aircraft and at least 5 more look to be ready for delivery over the next 11 days.  Including the aforementioned 787-9 for ANA other deliveries should include:

Air Canada - 1
Air India - 1
Ethiopian Airlines - 1
Kenya Airways - 1
QANTAS - 1
Qatar Airways - 1

Boeing needs to deliver and average of 10.3 787s in the last 6 months of 2014 in order  to make good on it's 10 delivery projections for the Dreamliner.

July 2014 also meant that the who's who of the Aerospace world trekked to Farnborough, UK for the bi-annual Farnborough Air Show except for your trully (I still have my day job to worry about).  Though I was hoping for some more 787 orders (particularly the -8 and -10), there were still come decent 787 orders coming from lessor CIT for 10 787-9d and MG Aviation (Arkia Airlines) for 2 787-9.  There is an LoI for 6 787-9 from lessor Avolon.  However, baring a major order, Boeing's 787 book to bill will be significantly lower than 1 this year as the orders are only trickling in.  Certainly they will receive many more orders for the aircraft but this may be stymied by the launch of the A330neo.  Boeing still has to study the effect that the launch may have on future 787s orders and how to mitigate.  Certainly, Boeing can improve the fuel efficiency of the -8 by continuing to take weight out of the aircraft as well as incorporating improvements from the 787-9 flight test program.  Boeing can also start equipping the -8 with the same hybrid laminar flow control technology that will be standard on the 787-9 and 787-10.  Adding this can make the 787-8 more attractive to customers when it comes to a decision between the A330neo and the 787-8.  As far as I know Airbus is not installing the technology on the A330neo as it is still trying to develop the technology.  While the A330neo has garnered 121 orders during the airshow, 50 of these is to Air Asia which only buys Airbus, and most of the rest were to lessors all of whom already have the 787 in their portfolio.  We will only know which aircraft will be preferred by operators when there is a head to head competition of the two airplanes for airline orders.  One such competition is coming up later this year when Delta will look to refresh its widebody fleet. Delta inherited Northwest Airline's 18 787-8 order when the two companies merged thus it will be interesting to see how this will be factored into the final decision by Delta's fleet managers and board.

Here's the final order tally from Farnborough (Boeing vs. Airbus only):

Boeing
Okay Airlines - 6 x 737Max8 (Firm), 4 x 737-800 (Firm)
Monarch - 30 x 737Max8 (LoI)
Avolon - 6 x 787-9 (LoI), 5 x 737Max9 (LoI)
Air Lease Corp - 6 x 777-300ER (Firm), 20 x 737Max8 (Firm)
Intrepid Aviation - 6 x 777-300ER (LoI)
CIT - 10 x 787-9 (Firm)
Hainan Airlines - 50 x 737Max8 (LoI)
MG Aviation - 2 x 787-9 (firm)
Qatar Airways - 50 x 777-9X (Firm), 4 x 777F (LoI)
Air Algerie - 2 x 737-700C (Firm)

Airbus
Air Lease Corp - 25 x A330-900neo (LoI), 60 x A320neo (Firm)
AerCap - 50 x A320neo (Firm)
IAG - 20 x A320neo (Firm)
AirAsiaX - 50 x A330-900neo (LoI)
Avolon - 15 x A330neo (LoI)
BOC Aviation - 43 x A320neo
CIT - 15 x A330neo (LoI), 5 x A321neo (LoI)
SMBC Aviation - 110 x A320neo (Firm), 5x A320 (Firm)
Air Mauritius - 4 x A350-900 (LoI)
Hong Kong Aviation - 40 x A320neo (Firm), 30 x A321neo (Firm)
Transaero - 12 x A330neo (LoI), 8 x A330 (LoI)
Unidentified - 4 x A330neo (LoI)

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

2014 Projected 787 Deliveries

787-9 Flight Testing Tracker

Boeing increases 787 production flight testing

Over the past few weeks, Boeing has been aggressively flying production 787s on Boeing and customer flight tests.  In June, Boeing has conducted seven B-1 flights on the production 787s and I do think that they can fly at least 4 more before the end of the month. This should include one aircraft for British Airways, ZA456 (LN 187, G-ZBJG), a BBJ for the Saudi Ministry of Finance, ZA779 (LN 193, HZ-MF8), one for United Airlines, ZB167 (LN 181, N38950) which will be used for 787-9/GEnX F&R/ETOPs testing and one for Qatar Airways, ZA474 (LN 188, A7-BCO).  ZA456 did file a flight plan on June 17th but the aircraft did not fly).


There was a large up tick in flight activity during the last week or so which leads me to believe the Boeing is going for an all out push to deliver around 14 787s this month.  They have already delivered 6 this month including the last 787 for China Southern Airlines from their order of 10 aircraft.




As for deliveries for the rest of this month, in my opinion this is the aircraft I see being delivered in the next 12 days:


ZA267 (LN 168, ET-AOV) for Ethiopian
ZB003 (LN 169, ZK-NZE) for Air New Zealand (1st 787-9 delivery)
ZA473 (LN 176, A7-BCN) for Qatar Airways
ZA580 (LN 183, EI-LNG) for ILFC/Norwegian
ZA656 (LN 184, 5Y-KZB) for Kenya Airways
ZA541 (LN 185, CC-BBF) for LAN
ZA295 (LN 186, N28912) for United Airlines
ZA588 (LN 190, HS-TQA) for ILFC/Thai (may not deliver until July)


Boeing does need to deliver many of these planes as ramp space is quickly being filled at both Everett and Charleston. There are about 30 planes that are outside on the flightlines, paint hangars and other spots at the two assembly locations but if the current pace of flight activity continues then much of that ramp space should be cleared over the next couple of weeks and occupied by aircraft that will be coming out of final assembly.  It does seem that Boeing has a pretty good handle on the assembly aspect but the build quality still has to improve a bit in order to avoid inventories from creeping higher again. 


Lastly, one additional note to my previous post regarding the 787-9.  The FAA has certified this aircraft for ETOPS 330 thus fulfilling Boeing's promise to Air New Zealand to deliver the ETOPS certified aircraft.

 

Full 787 List

Current 787 Production List

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787 Monthly Delivery Tracking

787 Customer Delivery

787-9 Flight Test Hours

Current 787 Operators

Projected 2014 787 Deliveries

 

787 Production Update - June 2014

Thus far through the end of May Boeing has delivered 33 787s.  With 7 months to go in the year, Boeing needs to ramp up the delivery rate if it is to deliver 110 787s by the end of the year.  That means they have to deliver 77 aircraft in the last 7 months...11/month delivery rate.

May Review

 

May was a disappointing month.  I was expecting at least 10 deliveries and Boeing managed 7. If the theme sounds familiar it's because it is.  There is an expectations that Boeing delivery rate will match the 787 build rate which currently is at 10/month though the airplanes that have emerged from final assembly still have minor travelled work that needs to be completed.  An interesting side to the delivery story for May though.  Boeing, it seems had delivered 2 787s to Air India last month while the official tally on Boeing's Order and Delivery website show that they delivered 1 to the carrier.  Sources have confirmed to me that Boeing did indeed make contractual delivery of ZA232 (LN 28, VT-ANC) though this aircraft still remains in Charleston.  The reason for this is still unknown.

 

June Preview

 

Boeing has ramped up 787 flight activity significantly and has delivered 4 787s through the first 10 days of June.  Some of these deliveries were slated for May but had rolled into June.  Boeing will need to deliver at least 7 more 787s which, at least for now, looks like they can accomplish easily.  They currently have 11 787s that are in production testing or that are ready for delivery.  I do think that 8 to 9 of those can be delivered this month.  Boeing should deliver the first 787-9 to Air New Zealand on June 30th pending a decision by the FAA (see below).  ZB003 (LN 169, ZK-NZE) has been flying lately and should be ready for delivery in the next couple of weeks.  Boeing will probably run a few more flight than they typically do in order to work out all the bugs and make sure that the aircraft has sufficient maturity to enter airline service.

 

787-9

 

Flightglobal revealed that Boeing is asking the FAA for a waiver in order to deliver the 787-9. The request is related to two items that are not compliant with the certification standards that Boeing and the FAA agreed to concerning the 787-9.  Boeing is scheduled to deliver ZB003 (LN 169, ZK-NZE), the first 787-9, to Air New Zealand on June 30th.  The two issues are 1) a capacitor in the ram Air turbine (RAT) that failed during a flight test.  This capacitor needs to be redesign and certified for use on the aircraft.  The second issues relates to a dial on a control panel in the cockpit of the aircraft.  The dial is altitude select knob that is used in the vertical flight mode.  The dial can be inadvertently rotate 1 or 2 stops beyond the desired setting if the pilot just presses the knob and thus violate altitude range set by the ATC.  There is a lack of sufficient torque that is causing this issue.  This will be watched closely to see what the FAA will do but it is concerning especially since the 787-9 flight testing has gone so well.  Boeing doesn't want to deliver this aircraft late even by a few weeks let alone a few months.

 

Most of the 787-9 testing appears to have been completed though Boeing still has to undertake F&R/ETOPs flight testing using an production aircraft equipped with the GE  GEnX-1B engines.  I anticipate that ZB167 (LN 181, N38950) should take to the air within the next 10 to 14 days and should fly a comparable number of hours as ZB197 (LN146, JA830A).

 

Charleston Production Ramp Up

 

Boeing is preparing to ramp up the 787 production at Charleston to 3/month from the current 2.  This switch should take place in early to mid July.  Boeing is currently loading a 787 into Position 1A every 12 to 13 days. They will need to load one every 10 days but the number of available assembly spots to conduct assembly activities has been reduced to 6 from 8 as two positions are undergoing construction (Position 1B and Position 6).

 

ETOPS 330

 

Boeing did get some good news from the FAA last month when the approved the 787-8 for ETOPS 330.  This means the 787-8 can operate from an airport that is no further than five and half hours flying time in case of an emergency.  This means the carriers can fly more direct and fuel efficient routes, especially over the Pacific and fully take advantage of the 787s capabilities.  It is now up to the local civil aviation regulators to approve or deny the airlines that are under their oversight to fly the 787 under ETOPS 330.  The 787-9 will not receive this certification until much later but it will probably be Boeing's next major certification as Air New Zealand is eager to have the aircraft certified for ETOPS 330.  I do not know when Boeing plans to achieve ETOPS 330 certification for the 787-9.

 

Full 787 List

Current 787 Production List

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787 Monthly Delivery Tracking

787 Customer Delivery

787-9 Flight Test Hours

Current 787 Operators

Projected 2014 787 Deliveries

 

Boeing ends April with strong 787 deliveries but still behind planned delivery pace

What was appearing to be an anemic month for 787 deliveries was actually a strong one for the aircraft program.  I was expecting about 5 to  deliveries but Boeing finished strong with 8 deliveries, 5 on the last day of the month.  That is the good news, the bad news is that to keep pace for 110 deliveries in 2014, Boeing needed to have delivered 37 787s in the first 4 months of the year.  They have delivered 26 through April 30th. In order to hit the 110 delivery mark, Boeing will have to average 10.5 deliveries per month for the remainder of the year.  Certainly this is an attainable goal but the pace thus far hasn't really looked promising. There are a number of 787s at both Everett and Charleston that have been waiting, patiently for their B-1 flight.  Thus far there has been only 2 B-1 flights though it is early in the month.  However to keep pace with 10.5 deliveries per month, Boeing does need to conduct far more B-1 flights and get these aircraft into production flight testing.


A bit of good news is that it appears that build quality is improving as there are far fewer test flights that need to be conducted (including customer flights) before the planes are formally delivered.  In April, of the 8 planes that were delivered 6 airplanes required an average of 3.5 flights before they were delivered.  I purposely excluded the two Qatar deliveries as they are considered outliers compared to the rest of the customer base.  This certainly bodes well for the 787 delivery rate if Boeing can keep the build quality high and thus get the aircraft into customer's hands faster.


For deliveries in May, Boeing has already delivered one 787 to Ethiopian, the airlines' 6th Dreamliner.  I can see the deliveries shaking out as follows:




Air Canada - 2
Air India - 2
ANA - 1
British Airways - 2
Ethiopian - 2 (1 delivered already)
Hainan - 1
ILFC/Norwegian - 1
QANTAS (Jetstar) - 1




Of course, many of there deliveries are predicated on several of these aircraft starting the flight test program soon (there's only 23 days left in this month).  Already, a British Airways' 787 (ZA454, LN 173, G-ZBJE) has conducted (or is conducting at press time) its C-1 flight. The next one week will help further understand what delivery rate Boeing will achieve this month.




A Word About the 787-9


Boeing continues to execute well on the 787-9 flight test and certification program.  Last month Boeing started F&R and ETOPs testing on a production 787-9 eventually destined for ANA.  ZB197 has been flying regularly in order to have certification ready by next month and delivery of Air New Zealand's for 787-9 to be made around mid July.  Word is that because of Boeing strict disciplined approach to designing and testing this aircraft, that delivery should be made on time.  Boeing will also probably fly ZB167 (LN 181, N19951) which will conduct the same F&R/ETOPs testing though on the GE engines.  This aircraft is currently in paint and should fly by the end of this month to support 1st delivery of the GEnx-1B powered 787-9 later this year.  It is rumored that ZB167 should deliver to United in July as well.




Production


As stated in my previous post, Boeing looks to be putting the Mitsubishi wing issues behind it as at this point should not be a show stopper for deliveries.  Great progress was also made on reducing the travelled work from the Charleston mid-body fuselage plant (88-20) to point that there are no more than 150 minor JBS (jobs behind schedule) that need to be completed on the 787s coming out of final assembly.  To underscore this point, Boeing is doesn't appear to be sending 787s coming off the two lines in Everett to the EMC but instead are going to the 40-51 ramp where the remaining JBS are completed and then the aircraft is taken to paint and then to the flightline where it will be prepared to enter the flight testing program.  This is huge news and it appears the hard work has figuratively and literally paid off as the Boeing workers in Charleston will be paid a nice bonus in a few days for bringing down the JBS from about 8,000.  It will now be up to Boeing's managers to make sure that the JBS doesn't become unmanageable while the production rate steadies at 10/month.


Lastly, some of you have noticed that ZA436 (LN 151, B-2738) for Hainan has been flying a lot out of Boeing Field in Seattle.  While I do not have confirmation, I suspect that this aircraft is performing flight and certification tests on the revised software for the 787 in order to reduce the number of false warnings and improve flight dispatch reliability through out the 787 fleet.  Some earlier testing was done on the 787-9 but it does appear that Boeing is doing these tests on a production standard aircraft.  The fact that the airplane is flying out of Boeing Field where Boeing Test Flight is based lends some more credence to my theory.




Full 787 List

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Current 787 Operators

Projected 2014 787 Deliveries




 

Boeing details 787 progress during 1st quarter earnings call

Yesterday Boeing released its 1s quarter earnings which topped analyst expectations.  The 787 deliveries has contributed significantly to the improved bottom line and Boeing was more than happy to share the progress on the 787 program.

Boeing noted that they hit the 10/month production rate fully during the quarter but also have completed the preliminary design review on the 787-10.  Boeing will now proceed with the detail design of the 787-10 which is expected to enter production around 2016.

The production rate has stabilized at both Charleston and Everett which will also help them stabilize the delivery rate.  Boeing did note that there will be continued variance in the delivery rate as they are there are 18 customers receiving their first 787 this year and typically those customers have different requirements and testing that need to be done as well as differences in financing the final payment.  They did reiterate that they will deliver 110 787s this year. So far through today (April 24, 2014) they have delivered 21 787s.  I believe they can deliver at least 2 more, possibly 3 this month for a total of 23 to 24 for the year and 5 to 6 for the month of April.  Obviously they will need to pick it up in the later months going forward.  The lack of deliveries to Air Canada, I believe, hurt their April delivery number which could have added at least 2 more to that monthly total.  IT is rumored that the delays are attributable to issues with the IFE though it is not confirmed.

As mentioned earlier, Boeing said that the production system has stabilized.  The two issues that have also contributed to slower deliveries was the wing issue by Mitsubishi and the increase in travelled work on the mid body fuselage.  With regards to the former, Boeing said that there are only 3 more aircraft that need to be inspected and fixed thus that issue is largely behind them.  On the later, there has been a great improvement in the reduction of the number of open jobs.  Sources have confirmed this to me to be true but that there is still some improvement needed with regards to the travelled work.  It does appear that there are fewer aircraft going to the EMC and are actually going to the ramp to finish off the minor jobs still opened and then proceeding to the paint hangar.

The 787-9 testing is also going really well and Boeing is still maintaining first delivery in the middle of the year.  The 6th 787-9 to be built just rolled out of final assembly.  This is ZB167 that will be delivered to United Airlines in July.  This aircraft will participate in the flight testing program as well and I anticipate that it should start flying around the middle of next month.  It will undertake F&R/ETOPs testing with the GE GEnx-1B engines.  Boeing also said that unit cost for the 787-9 have improved 30% between the first and 6th 787-9 which is tremendous.  It should continue to drop as more aircraft are introduced into the production system and the assembly has stabilized.  However Boeing is expecting that most of the production over the next couple of years will be 787-8 vs. 787-9.

Lastly, dispatch reliability is continuing to trend above 98% but Boeing still is not satisfied and will be looking to get that above 99% which is not expected to happen until later this summer when improved software is introduced to the 787 fleet.

Full 787 List

Current 787 Production List

Delivered 787 List

787 Monthly Delivery Tracking

787 Customer Delivery

787-9 Flight Test Hours

Current 787 Operators

All Things 787: Projected 787 Deliveries


 

Boeing delivers 18 787s in 1st quarter 2014; 787-9 stays on pace to complete certification by June.

Boeing reported 3rd quarter 787 deliveries on Thursday and, given the issues of the past quarter, were surprisingly good.  Boeing has delivered 18 787s in the first quarter of 2014 and 132 through March 31st.  To date Boeing has delivered 133 787s.

I was full expecting 787 deliveries to be curtailed during this quarter due to the on going travelled work as well as the wing inspections.  In March Boeing delivered 10 787s of these 6 of them were in the batch that had been identified as needing wing inspections and possible repairs.  This suggests that not all the 787 in the batch which includes LN 151 to LN 193 inclusive may have the wing issues.  Future deliveries may not be hurt as much as was feared due to this issue.  Notable deliveries were made to Kenya Airways, 2 each to Japan Airlines and Qatar Airways as well as deliveries to Royal Brunei, Aeromexico, Norwegian, United Airlines, and Air India (the first 787 assembled for them).  So far so good.  However, Boeing needs to maintain a delivery rate of 10/month in order to meet their guidance of 100-110 787 deliveries in 2014.  They were hurt by low deliveries in February where the expectation was to be a significantly higher delivery rate compared to the 4 that were actually handed over.

Production seems to have moved back to a regular pace since the travelled work issues forced Boeing to extend the amount of time that each airframe was spent in final assembly.  At the start of the year air frames were spending 34 days in final assembly.  This grew to as many as 42 days but now looks to be trending down.  The last aircraft to be rolled out, ZA136 (LN 179) for ANA spent 37 days in final assembly.  Boeing expects to be over the travelled work issues by the time LN 195 is loaded into Position 1A sometime next Friday.  According to sources, the travelled work has greatly improved thus I do expect that by May Boeing will have stabilized the production system for the 787.  They are are still building at a rate of 10/month according to my data.

While it is still early in April, Boeing does need to pick up the pace of production flight tests.  They have delivered 1 787 to Qatar Airways on April 1 and have started customer flights on ZA275 (LN 161, SP-LRF) for LOT.  This aircraft may deliver as early as next week.  However there are only 4 other aircraft that have started production flights and none of those have had customer flights as of yet.  ZA472 (LN 150, A7-BCM) is probably the closest to having customer flights.  There has been a notable lack of 787 B-1 flights, the last came on March 25th...11 days ago.  Moreover aircraft that have been out on the flightline for sometime don't appear ready to start production flights.  ZA610 (LN 160, C-GHPQ) was observed by Matt Cawby going back into the EMC for an unknown reason.  Air Canada maintains that they expect their first 787 this spring but there hasn't been anything regarding a month.  They may be able to deliver 10 787s this month but they need to start getting these airplanes into the air.

787-9 flight testing has been steaming along with very few hitches.  It appears that Boeing is on the cusp of starting functionality and reliability and ETOPs flight testing very soon. ZB197 (LN 146, JA830A) was observed by Matt Cawby as having a US civil registration decal.  I think this aircraft should be conducting its first flight within the next one week and subsequently join the 787-9 test flight program. The program has accumulated well over 1000 flight test hours and about 450 test flights.  It is expected that will accumulated over 1500 flight test hours by the time Boeing is done.  ZB197 will perform the F& R/ETOPs flight tests for the 787-9 powered by Roll Royce, ZB167 (LN 181) for United Airlines will undertake the same testing for the GE powered version of the 787-9.  This aircraft should roll out around Monday, April 7th.  I would expect it to start flying around mid to late May.  It is around this time that flight testing on the Rolls Royce powered 787-9 should almost be complete.

As far as April deliveries are concerned, we've already seen one aircraft delivered to Qatar Airways.  There should be two more than should deliver relatively soon:  ZA 275 (LN 161, SP-LRF) for LOT Polish, and ZA472 (LN 150, A7-BCM) for Qatar.  Other carriers that may see deliveries include: Air Canada, Ethiopian, Air India, Hainan, Aeromexico, Norwegian, Royal Brunei, and Jetstar (QANTAS).  A few of the still have to conduct a first flight and more still have to conduct follow on Boeing flights.


Full 787 List

Current 787 Production List

Delivered 787 List

787 Monthly Delivery Tracking

787 Customer Delivery

787-9 Flight Test Hours

Current 787 Operators


 

787 Firing Order Updated

The 787 firing order has been updated.  The order for L/N 181 to L/N 200 are now listed and doesn't contain too many surprises.  This firing order should be for aircraft that will enter final assembly through April (end of April).

Here's a quick breakdown:

New operators:

Thai (leased from ILFC)
Arke (formerly Arkefly, through TUI Travel)
Royal Jordanian

Breakdown:
ANA - 1
BBJ - 1
British Airways - 2
Ethiopian - 1
Kenya Airways - 2
ILFC - 2
LAN - 2
QANTAS - 2
Qatar Airways - 1
Royal Jordanian - 1
TUI Travel - 3
United - 2

Only one 787-9 will be going through production and this aircraft is slated for United Airlines (ZB167).

Full 787 List

Current 787 Production List

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787 Monthly Delivery Tracking

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787-9 Flight Test Hours

Current 787 Operators