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
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787 Build Location By Operator 
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ZA001 to be donated to Japanese museum

Screen Grab from Flightradar24

Dreamliner 1, the first Boeing 787 will fly to Boeing Field today after spending several years in storage in Palmdale, Ca.  The aircraft will subsequently fly to Japan, perhaps around the end of this month, where it will be donated to a yet un-named Japanese museum after removal of flight test equipment.  Much of the aircraft's primary structure was built in Japan including the wings. The second and third 787s were donated to the Pima Air Museum and Museum of Flight respectively.

Boeing 787 May 2015 Mid Month Report

Midway through the month of May, Boeing is set up quite nicely to delivery a good number of 787s to customers.  Thus far Boeing has delivered 4 787s this month including the last of American's 787-8 that were delayed due to the seat issues at Zodiac.  Thus far Boeing has delivered 273 787s, 45 during 2015 and 4 in the month of May.

More encouraging is the level of 787 flight test activity that has occurred over the last week and a half.  There have been a number of customer flights that have taken place and as a consequence, there are 6 aircraft that are ready to be delivered including at least 5 that are expected to be delivered on May 21st.  Boeing is expected to conduct a customer flight in a next couple of days on a 787-9 for United Airlines that will be delivered from Charleston.  Thus we can see 6 787s delivered by the start of the Memorial Day weekend for a total of 10 in May with a few more expected to be delivered by the end of May.

However there is a more impressive statistic that I would like to share.  The last 15 787 deliveries made by Boeing (essentially the 11 April deliveries and the 4 May deliveries) required and average of 3.8 test flights before the airplanes were handed over.  This average excludes the flights made by Charleston built airplanes for painting purposes.  Another impressive statistic:  Over the same 15 airplanes (excluding the last 2 American Airlines 787s that were delivered during this period) the average time from start of final assembly to delivery is 89.5 days across all three lines in Everett and Charleston.

If Boeing can execute, they can potentially have delivered 13 787s this month, 53 for 2015 and 282 787 delivered since program deliveries began in 2011.  There is a potential hiccup though it doesn't seem to be serious.  There are three 787-9 for Etihad that have completed final assembly but have not had any test flights.  The aircraft are painted but have been sitting on the flightline.  One airplane, ZB079 (LN 286, A6-BLC) having finished final assembly activities in mid February....3 months ago! Another, ZB080 (LN 302, A6-BLD) rolled out about a month ago.  A third, ZB081 (LN 305, A6-BLE) rolled out of final about 3 weeks ago and just came out of paint a few days ago.  I can only speculate that these airplanes are being held up because of issues with Zodiac as well.  It appears that these airplanes will be delayed for just as long as the ones for American.  These three are the only remaining deliveries to Etihad this year.

Lastly, with about 6 months left before the temporary surge line is shut down for good, There are still 12 airplanes that are in assembly or will go through final assembly by November.  Boeing will start 2 more 787s this month, 3 next month (June) and then execute a rate break whereby 2 airplanes will go one each to the main Everett line and the main Charleston line.  From July to October, Boeing will send only 1 787 to the temporary surge line.

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
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787 Build Location By Operator 
787 Build Location By Customer

Boeing to shut down 787 surge line by year end to take advantage of production efficiencies; start up 777X production

On Friday Boeing announced the decision to shut down the 787 temporary surge line in Everett and move the assembly of airplanes from that line to the main lines in 40-26 and 88-30.  By the end of the year both lines will be producing 5 787 per month.

The decision to close it down is certainly not a shock but to shut it early was a surprise.  Efficiency gains that were realized earlier than expected on both the Charleston and Everett lines allowed for cost reduction that come with merging the three lines into 2.  Boeing figured that it now costs less to produce 10 airplanes in 2 line than it does on 3 lines.  Boeing will start converting the line to in order to do assembly activities on the 777X which is slated to start production around 2017-2018.

The switch over will down gradually over the next 6 months.  Charleston should be at 4 by the start of July while 40-26 will be producing 5 and 40-24 will be at 1.  By November, the switch over from 40-24 to 40-26 and 88-30 should be complete. The last 787 to be built on the TSL will load around October and in November all future assembly activities will be done either on 40-26 or 88-30. ZB236 (LN 381) will be the last aircraft built on 40-24.  This airplane is for AerCap and being leased to KLM.

Boeing started production on the 40-24 surge line in the 3rd quarter 2012 as means to reduce schedule risk associated with opening the Charleston line as well as a means to catch up on deliveries delayed by the repeated Dreamliner production issues.  The line no has fulfilled its mission and 40-24 will now be used to support production of early 777X airplanes.

Beverly Wyse's statement to BSC employees regarding the surge line shutdown:

Today Boeing Commercial Airplanes announced that we’ve finalized plans to close the Everett 787 Dreamliner Temporary Surge Line (TSL) later this year to allow the 777X Program to transition into the factory space currently occupied by the TSL and begin production preparations for the 777X. We are confident that the timing is right for this transition, and our ability to do so this year is a testament to our teams’ capabilities. 

With the phasing out of the TSL, BSC Final Assembly will produce five additional airplanes, meaning that we will transition to our Final Assembly production rate of five per month earlier than planned.

We continue to work on improvement with some of our suppliers, and we’re confident in your ability to execute this plan. I am committed to insuring that BSC remains stable and that we follow our site overtime guidelines so our teammates enjoy time off with their families. 

This is great news for our site further demonstrates the very high level of confidence that the Boeing executive leadership team has in your abilities. Boeing South Carolina has quickly earned a reputation for successfully rising to any challenge with our “Bring it On” attitude, and if any team can do this -- and do it successfully, it’s you! 

As always, thank you for your hard work and dedication!

Beverly 

The 6 787-8 that were ordered from an unidentified customer late last month will be coming from the lot of early build 787s (also known as the "Terrible Teens").  The customer ordered Roll Royce engines throwing into doubt about who is the end user.  I had speculated that the order is for Ethiopian or a lessor with a n agreement to lease the airplanes to Ethiopian given the news over the past month or so.  However, Ethiopian's current fleet of 787s use GEnx engines.  IT's still very possible that the airplanes can end up with Ethiopian who don't mind using the Trent-1000 engines.

From the firing order it also appears that TUI Travel has ordered the 787-9.  It's still too early to know how many but the order must be one of the unidentified 787-9 orders that is listed on Boeing's order and delivery web site (there are 4 separate orders).  Also on the firing order is 2 additional 787-9 for united Airlines (LN 443 and LN 445).  They had recently reduced their 787-9 order to 16 so I believe the changes hadn't made it way through the system.  I fully expect that LN 443 and LN 445 will be allocated to another 787-9 customer within the next couple of months.

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

Boeing records 9 787 orders in April

Despite the loss of 10 787-9 orders from United Airlines, Boeing did record 9 x 787 orders in the month including 1 x 787-8 BBJ, 2 x 787-9 for Air Tahiti Nui and 6 x 787-8 for an unidentified customer.

I believe, though I have no evidence yet, that the 6 x 787-8 orders are for Ethiopian and will come from the 6 assembled "terrible teens" that are awaiting change incorporation and re-work at Everett.

One minor change is that American Airlines will now take 20 787-8 (a reduction of one) and 22 787-9 (an increase of 1).

Boeing attempts to build and deliver 787-9 in 67 days

Boeing is going to try and build and deliver a 787-9 for Scoot in 67 days.  The aircraft in questions, ZB130 (LN 308, 9V-OJD) started final assembly on March 23 and rolled out on April 22, which was 30 days later, from the main 787 assembly line 40-26 in Everett.  It took its first flight today, May 6 which is 2 weeks after rolling out and is projected to spend 23 days in pre-delivery.

ZB130 still has to be painted that should happen between May 10 and May 15th with delivery occurring on May 29th.  This would be 67 days from the time the aircraft entered final assembly to the time it would be delivered.  Of course this could be derailed if there are maintenance or build issues or if Scoot is not prepared to take delivery for some reason.

If Boeing is able to accomplish this, it would be a milestone event in the 787 program as Boeing has yet to build and deliver a 787 in under 70 days.  The current record is 76 days when Boeing built and delivered a 787 to Arke (owned by TUI Travel) earlier this year.  That aircraft, ZA324 (LN 281, PF-TFM) was built in Everett and spent 38 days in final assembly (40-24 surge line), 24 days in pre-flight testing and paint, and 14 days in pre-delivery.  Boeing would hve more confidence in increasing the production rate as well reaffirm their production methods with the aim of further reducing production costs.  If Boeing can demonstrate faster production and delivery times, it can go a long way to reducing 787 production costs which has been a drain on its earnings,

787 April 2015 Month End Report

Boeing started final assembly on 12 Dreamliners in April while rolling out a further 12 from their factories. Boeing was able to deliver 11. This put Boeing's 787 production efficiency at 1.09 (12 roll out/11 deliveries) which is slightly higher than the last 2 months and is higher than desirable.  An efficiency ratio less than 1 indicates that Boeing delivering more 787s than they are rolling out and would be desirable for times when Boeing need to deliver early production and/or test flight aircraft or during times when there are deliver delays like the one that occurred when Zodiac fell behind seat deliveries.  In an ideal world roll outs would match deliveries and efficiency ratio would be 1. Thus far this year, the 787 production efficiency is slightly over 1 at 1.02.  However what is impressive to note is how spread out deliveries have been though the month of April.

Notable deliveries include a 787-9 delivered to a BBJ operator Kalair as well as 2 delayed 787-8 for American bringing their fleet to 4. American has been conducting training flights since January and will start revenue flights this month in domestic routes (Dallas to Chicago) and international operations in June.

It appears that Boeing has an opportunity to deliver 13 to 14 787s in May though almost half of these airplanes have yet to fly a B-1 test flight.  It is an ambitious delivery schedule with at least 5 of these deliveries schedule to be made on May 21, just before the start of the Memorial Day weekend.  If Etihad is able to take up two 787-9 in May then Boeing will have delivered 14 787s. Key to achieving this delivery rate is timely flight tests of the production 787s as well as no more supplier issues.

On the production front, Boeing will start final assembly on the first 787-9 for Air Canada as well as a 787-8 BBJ for the Sultan of Brunei.  Boeing appears to be aiming to start final assembly on 11 787s this month (with 4 of them in North Charleston like in April) so I have to wonder if they're already at a higher rate given that they rolled out 12 airplanes and started final assembly on 11 in April.  It's something that will be watched, particularly in North Charleston where it may appear that Boeing is at a 4/month rate.

In recent news, everyone is well aware of United's order switch of 10 787-9 for 10 777-300ER and American Airlines' deferral of 5 787s due next year now schedule for delivery in 2017 and 2018.  The impact to the order book was minimal but it does free up slots (especially for next year) that will be most likely be taken up by Hainan Airlines as they expect to place a large order for the 787-9. American's switching of delivery slots also opens up 5 near term slots for customers, potentially also for Hainan's upcoming 787-9 order. American will stall take delivery of 8 787s next year.  All in all these adjustments may actually help Boeing win more orders later this year, especially with the Paris Air Show coming up next month.  I wouldn't be surprised if Boeing announces the Hainan 787-9 order there and perhaps some exercising of some options.  Also I expect Air Austral's order for two 787-8 to be reveals (it's already booked as a UFO order on Boeing's order and delivery web site).  The next 6 weeks we may see some more unidentified 787 order being booked that will be revealed in mid 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