Boeing delivers 11 787 in August; 600th Dreamliner due to be delivered on September 26th

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	Number
Testing Complete	3
To be assembled in Everett	152
To be assembled in Charleston	117
Parts Arriving	6
Undergoing final assembly	9
Storage	0
Storage/Change Incorporation and Re-Work	0
Change Incorporation and Re-Work	0
Pre-Flight Prep	12
Production Testing	6
Non Customer Flight Tests	4
Ready for Delivery	1
Donation	3
Delivered	589
TOTAL	902

Boeing delivered 11 787s in the month of August (3 x 787-8 and 8 x 787-9).  The batch of aircraft that were delivered included Air India's penultimate 787-8 and El Al's 1st 787-9 leased from Air Lease Corp.  Total 2017 deliveries stand at 89 as of August 31st (21 x 787-8, 68 x 787-9) and for the program Boeing has delivered 589 787s (345 x 787-8, 244 x 787-9).

With these totals Boeing is on track to deliver the 600th 787 in late September.  Based on the current delivery schedule, this delivery should occur on September 26th. However, Boeing has 2 787 deliveries schedule for that day:  ZA458 (LN 609, G-ZBJI) a 787-8 for British Airways which has already flown it B-1 flight and ZB247 (LN 613, F-HRBC) a 787-9 which is being leased to Air France from AerCap.  We probably won't know until late that day or the next day.

Other notable deliveries in August include Thai Airways 1st 787-9 being leased from AerCap and the end of the terrible teens.  That's right ZD012 (LN 19, VP-CSC) will deliver around September 29th to RTX (which is a holding company) thus marking the end of the painful gestation of the 787 program. While this delivery will also mark the end of Boeing's need to devote resources to aircraft that were overweight and somewhat hard to sell, it also is a symbolic turning of the corner for the program though the program continues to face challenges.  The foremost of this challenge is to whittle down the almost $30 billion in deferred production cost racked up by the 787 program.  Another challenge (which is facing Airbus as well) is the anemic widebody aircraft market as sales in this sector have slowed significantly.  More on these two challenges later.  The program has changed immeasurably.  The 787-8 was the dominate version when Boeing first launched the program. Now the 787-9 is by far the more popular version and the 787-10 may even more popular in the years to come as airlines look to replace A330-300 and 777-200.  Boeing has changed the way the program was managed and the production system that caused many of the headaches in 2007/2008.  Instead of being the integrator of parts coming in from around the world, Boeing took some production and assembly tasks back in house from many suppliers.

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Boeing's production continued apace with 13 aircraft rolled out (versus the 11 deliveries) thus the number of airplanes waiting to be delivered increased by 2 and outpaced the delivery rate.  Boeing seems to have normalized the production rate after introducing the 787-10 into the production system.  In fact the first 787-10 for Singapore Airlines is under going final assembly in Charleston as evidenced in the photo below (see top center of photo the aircraft in front of the one for Air New Zealand).

Boeing Photo

We also now know how many 787s can fit inside 88-30 - 9. Speaking of production, my 787 firing order was updated to reflect the firing order up to LN 769.  Next year we'll see the first 787-9 for Juneyao Airlines.  Also revealed was an unidentified customer now known as Bank of Communications Leasing.  This is a Chinese bank which has bought at least 1 and possibly more 787-9s.  The 1st one is being leased to Hainan Airways and will be delivered next year.  We also know that Etihad will receive at least 2 787-10 next year.

Today was a big news day for the 787.  First Boeing announced that the production rate would increase from 12 to 14 in 2019.  This is pretty surprising as orders have been slow to come in and Boeing hasn't had a book to bill above since 2013.  Boeing needs more orders, quite frankly, to justify the increase in production rate but management had other reasons.  By increasing the rate they can generate more free cashflow and increase margins per aircraft.  They're also anticipating a resurgence of widebody aircraft orders as a replacement cycle should be coming up in the early 2020s. They still need orders though.  The other big news was that Malaysia Airlines signed a MoU for 8 787-9s but after news that Emirates was about to order the 787-9 and 787-10 came out in July,  the airline later came out this month and told Aviation Week that market conditions have forced them to shelve the order for either the 787 or A350 "for now."  This order would have been a major shot in the arm for the 787 program though surprises could still happen two months from now.  Orders will continue to be a challenge as will the continued challenge of reducing the almost $30 billion in deferred production cost accumulated by the program.  Heck I'm still waiting for Garuda Indonesia to finalize its order for 30 787s or for Turkish to announce their order (they're supposedly now buying 8 747-8I). Boeing added 100 to the accounting block going from 1300 to 1400 and thus spreading the production cost across a larger number of units and showing greater profitability (margin) on each aircraft delivered. At the end of the day Boeing will need to up it's sales campaigns as well as start convincing those customers that hold 787 options and purchase rights to exercise them.

Lastly, 787-10 flight testing is continuing and has crossed over 650 flight test hours by my estimation.  Boeing has also started final assembly of ZC003 (LN 622, 9V-SCB) for Singapore Airlines and I anticipate that this airplane will be the first 787-10 delivered after conducting flight test in support of the -10 certification.  I continue to believe that flight testing should wrap up early in the 1st quarter of next year.

787 Production Tables