Boeing delivers 787 to Ethiopian, Air India may be next

Photo by MoonM

Boeing now has delivered a 787 to its third customer, Ethiopian Airlines.  ZA262 (LN 49, ET-AOQ) was officially handed over to the airline yesterday and flew away to Washington Dulles International Airport early this morning.  This is good news for Boeing as it not only frees up another spot on the flightline but should kick off a large number of deliveries over the next couple of months.  It is rumored that Air India is to take the next 787, ZA 236 (LN 35, VT-ANH) on Friday and flyaway on Saturday to New Delhi.  Air India is expected to take the three service ready 787s over a two week period starting on Aug. 17.  What should follow is a gaggle of deliveries to Qatar Airways, LAN as well as to current operators ANA and JA during the month of August.

Since yesterday more airplanes have actually shown up on the flightline at Everett including China Southern's first 787, ZA382 (LN 43, B-2727) and another for JAL, ZA178 (LN 27, JA824J) both of which are at the fuel dock. The flightline is getting ever more crowded with completed 787s that are ready for pre-flight or are currently in pre-delivery test flights.  Boeing continues to work down the accumulated 787 inventory with a couple more 787s entering change incorporation including those for Qatar and ANA.

I do anticipate that by the end of September, Boeing would have delivered a total of 27 - 30 787s since deliveries began almost a year ago.  This will include anywhere from 8 to 10 in August and about 7 more in September.  This includes deliveries to Air India.

September should see deliveries to Qatar, Air India, ANA, JAL, United and China Southern.  The 787 Production and Disposition Table has been updated as of August 15, 2012.

Updated 787 delivery information

Activity around Everett has increased in recent days as far as the 787 is concerned.  ZA100 (LN 7, JA803A) continues pre-delivery test flight, ZA262 (LN 49, ET-AOQ) performed a customer test flight and ZA118 (LN 67, JA813A) conducted its B-1 flight).  Even though August is almost one half over a posting on airliners.net says that there will be 7 Dreamliner deliveries made this month not including deliveries to Air India.  The delivery train starts this Monday (August 14th) with first delivery to Ethiopian of ZA262.  Less than a week later ZA100 will deliver to ANA on the 20th.Qatar Airways is scheduled to be the 4th carrier to take the 787 (ZA461) around August 22nd followed by LAN (ZA536) on August 27th.  ANA takes one on August 28th (ZA119). Both JAL (ZA182) and ANA (ZA118) take one each on August 30th.  Again this schedule is subject to change and many of these deliveries can move to a later date.  If this schedule holds then it would be the most 787s delivered by Boeing in one month and will add 3 new airlines flying the 787. 

It is possible that Air India could be added this month but they are having a very hard time arranging financing to pay for the jets that are ready for delivery and is reflective of their financial distress.  It is unknown if Boeing will penalize them for not taking delivery in a timely manner but Air India has been aware that these airplanes are ready for delivery but chose not to pursue financing until after they got approval to take delivery from the GoI.  This reinforces the view of many that this is a very poorly managed airline.  The Air India -787 saga continues, unfortunately.

September is also promising to be just as good as August was in terms of '87 deliveries with United and China Southern both taking their first airplanes.  All September deliveries are tentatively scheduled for the second half of September and kcks off with Ethiopian taking delivery of ZA264 (LN 71, ET-AOR) on Sept. 18th as well as United (ZA288, LN 53, N20904) also signing for its first 787 on the same day.  Two days later Japan Airlines will take its 6th 787 which is an early build Dreamliner, ZA178 (LN 27, JA824J).  ANA takes a 787 which is the first 787 to be rolled out without needing to go to the EMC.  ZA135 (LN 66, JA815A) should deliver around September 25th.  Qatar Airways will take its second 787, ZA463 (LN 64, A7-BCD) on September 27 but also delivering on that date will be the first '87 for China Southern.  This airplane is ZA382 (LN 43, B-2727). 

All together this is 13 787s that is scheduled to be delivered over the next 6 weeks and will take Boeing to 25 787 delivered in 2012 not including tentative deliveries to Air India if and when that happens.  By the end of September, if all goes according that what I laid out in this post, then there will be 7 customers flying the 787 by the end of the third quarter possibly 8 with Air India.

First 787 B-1 flight in almost 3 weeks scheduled to be conducted today

The first 787 B-1 flight to be conducted in almost three weeks is scheduled to take place today at about 10AM PT (1PM ET) today.  ZA100 (LN 7, JA803A) will fly its first flight.  This aircraft is the first production airplane to be assembled though it is also the aircraft that needed the most modifications. It has been in Everett for over three years since it started final assembly. If goes according to plan, this aircraft should deliver to ANA by middle to late August depending on any issues that would need to be corrected.  The flight is on Flightaware.

According to a posting on the airliners.net forum, Boeing is planning to deliver some where around 7 '87s in August as follows:

ZA100 (LN 7, JA803A) to ANA - 2nd to 3rd week of August
ZA461 (LN 58, A7-BCB) to Qatar - 4th week of August
ZA262 (LN 49, ET-AOQ) to Ethiopian - 4th week of August
ZA118 (LN 67, JA813A) to ANA - last week of August
ZA536 (LN 68, CC-BBA) to LAN - last week of August
ZA119 (LN 69, JA814A) to ANA - last week of August
ZA182 (LN 70, JA828J) to JAL - last week of August

Notable is the absence of ZA135 (LN 66, JA815A) which was the first 787 that did not need to go to the EMC.  This airplane probably needs a little bit more time to finish off the 300 some assembly tasks that remained after being pulled out of the assembly line.  This list has the potential of adding 3 maybe 4 more 787s if the Indian Government finally approves the compensation deal between Air India and Boeing.  That is the potential of 10 to 11 deliveries next month and would take Boeing to almost to the 2/3 point of the total 787 deliveries that they have projected for 2012 (35 to 42 with 12 currently delivered).

787 info from Boeing's 2nd quarter earnings call

                                         Ethiopian's First 787 (ZA262) returning to Everett.
                                         Photo by Bernard Leighton

Today was quite a day for Boeing and the 787. A lot of news today so let's get started

Boeing's Earnings Call

Boeing Earning's came out today and showed quite an improvement.  As far as the 787 is concerned Boeing said a few things that were already known but let's go through the highlights.  Boeing is saying that they're seeing a high level of completion of aircraft coming out the final assembly line at Everett.  It's close to 100% apparently.  They're still tracking to increase production to 5/month by the end of this year and 10/month by the end of 2014.  Boeing is expecting to see higher 2nd half 787deliveries both from aircraft coming off the assembly line as well as those finishing change incorporation.  However Boeing does expect to see an increase in inventory as deferred production balance was recorded at $13.2bn and is expected to grow to about $20bn by the time the production rate hits 10/month after which there should be decline in this balance as airplanes are cleared out of inventory and the production system stabilizes at that rate.  In terms of deliveries Boeing said the deliveries were paced by customer demands and request.  It seems that this may be the reason why there hasn't been too much 787 pre-delivery activity at Everett.  They also said that aft fuselage production is a "hot spot" for Boeing in terms of 787 production and they still have some issues there which they're addressing. It's not a show stopper for the production rate increase. Jim McNerney said that the most important thing is that production is now occurring without the need to send airplanes to the Everett Modification Center (EMC) for change incorporation.  He also said that there is plan to get the aircraft that have to go through the EMC out in an orderly fashion.  He said that the EMC will continue to see work for the next year and half plus (so let's assume for another 18 to 21 months or end of first quarter 2014). Aside from Air India (a deviation from planned deliveries) which is all to well known, Boeing does have a ramp plan for deliveries for the second half of the year.  In terms of the improvement they said that ZA182 (LN70, JA828A) had about 160 open jobs left so they're seeing a lot of improvement in the condition of assembly.  Boeing is also seeing improvement at the EMC in terms of work behind schedule and shortages. They also said that the Trent 1000 gear box issue won't affect deliveries and 4 of 5 of airplanes ANA airplanes have been fixed and it's a very minor issue.  This issue won't affect deliveries of the airplane.  Boeing also gave more indications (there is greater fidelity on the evaluation of the business case) that they will do a 787-10X and that a decision should come later this year or early next year.  McNerney said that it does look like a good airplane which would have a lot of market demand. 

Looking ahead to 787 delivery forecast for the remainder of the year, Boeing said that they still expect to deliver between 35 and 42 787s for all of 2012.  They have already delivered 11.  This means that between 24 and 31 787s will be delivered by the end of this year and this will be split 50/50 between airplanes from EMC and those coming off the final assembly lines in Everett and Charleston.  Thus Boeing is saying that they would deliver between 12 to 15 787 each from EMC and the final assembly lines over the next 5 months starting in August (1 787 already has been delivered from the EMC in July).

Air India

Delivery of Air India's 787s is one step closer as an Indian Government Group of Ministers (GoM) had approved the deal between Boeing and Air India.  The matter now goes to the Indian Cabinet for final approval.  If and when that approval is given the delivery will take place and the fly aways will occur.  It's not known when the Indian CCEA will meet next but it is at his next meeting that the compensation deal will be discussed.

Aeromexico Order

Aeromexico added to the days news with a huge letter of intent (LoI) for 90 737 MAX8 and 737 MAX 9 as well as 10 787-9.  The deal is worth about $11bn.  It is not known if this order is inclusive of options of not but when the deal is finalized the numbers will then be known.  Aeromexico currently has orders for the 787-8 (both purchase and lease) and is expected to start taking deliveries starting in 2013.

Other News

The first 787 fro Ethiopian (see picture above) flew back to Everett this afternoon. ZA262 (LN 49, ET-AOQ) flew back in the Ethiopian scheme after spending close to two weeks in Ft. Worth being painted.  There were other 787s flights today but were test airplanes conducting Boeing test flights out of Boeing Field.  It is not known when the next B-1 flights will occur next but there are still some 787s that need the new gear box fro the Trent 1000 powered airplanes.  The timing of the next 787 test flights is also clouded by the planned closure of Everett's main renway from 4pm on August 2nd to 8AM on August 6th.  It is possible that Boeing can get 1 possibly 2 787s into the air for their B-1 flight before August 2nd but only if they're ready.

Trent 1000 gear box issue holding up deliveries: Aviation Week

According to an article by Guy Norris in Aviation Week, the gear box issue is holding up deliveries of the Trent 1000 powered aircraft as Boeing needs replacement gear boxes from Hamilton Sundstrand.  There are numerous 787s on the Boeing flightline waiting to be delivered.  Of the 9 airplanes that I have listed as in final preps for delivery at Everett, 5 are equipped with the Trent 1000 engine.  According to Guy Norris' report, 17 Trents in total are affected by the gear box issue of which nine are on undelivered 787s that are earmarked for ANA.  Boeing and Rolls Royce are waiting for replacement gear boxes from Hamilton Sundstrand.  Of the other 4 787s at Everett/Ft. Worth that are waiting to be delivered, one is in paint (ZA262), one for JAL (ZA182) just emerge from the paint hangar and will robably start pre-flight work soon, the one for Qatar Airways is still finishing up interior IFE work (ZA461) and another 787 that just appeared at the Boeing fuel dock, looks to be United Airlines first 787 (ZA288) and still has to go through painting before moving on the pre-flight.  All these are equipped with the GEnx engines. 

So it appears the bottleneck may be with the gear box issue with the Trent 1000 engines as each of the 5 Trent 1000 aircraft are all at different point in the pre-flight timeline. Each aircraft has to wait it turn while the aircraft that is further along must clear each pre-flight milestone before the B-1 flight.

In the meantime, the Trent 1000 gear box issue is likely a minor problem that affects a very small portion of the 787s in service but it's an issue that has attracted significant attention because it is the 787.

Lastly, LAN says it is expected to take delivery of its first 787 (ZA536) in late August or early September.

787 power and delivery woes

With about a week to go in the month it is obvious that Boeing will have delivered only one 787 in the month but what is most disconcerting is the lack of any real progress on the Everett (and Charleston) flightline.  There are 7 Dreamliners that have "finished" final assembly and change incorporation with another two that are either being painted or are finishing up some last minute inflight entertainment installation tasks.  It's the 7 airplanes that has caught peoples' attention.  Thus far Boeing has not conducted a single 787 test flight (B-1 or otherwise) since ZA262 (LN 49, ET-AOQ) for Ethiopian flew to Ft. Worth, Texas to be painted.  That was done on July 12th.  Additionally this aforementioned aircraft should have finished its paint job and flown back to Everett. Typically painting should have been completed in about a 10 to 11 days so it should fly back any day now, perhaps tomorrow. 

The first thought that the issue might be related to the gear box issues that has grounded 5 ANA 787s (3 have since gotten replacement parts and are back in the air).  However this is an issue that has effected (it appears) some of early delivered ANA 787s with the Rolls Royce Trent 1000 engines.  There are 787s with the GEnx engine that are ready to fly but have not flown just as yet.  Whatever is keeping these planes on the ground may be fleetwide though it hasn't stopped revenue flights.  It might be that Boeing is trying to finish up assembly tasks on each of these airplanes.  Boeing will have its earnings call on Wednesday morning.  It is hoped that there would be more clarification on this issue at that time.

In the meantime, the Trent 1000 gear box issue is likely a minor problem that affects a very small portion of the 787s in service but it's an issue that has attracted significant attention because it is the 787.

Are 787 deliveries slowing down?

UPDATE: I got word that Qatar's first 787 will be delivered in August but it's still open as to when in August.  Given that at Everett there are only three 787s that have had their B-1 flight thus far (ANA, Qatar, & Ethiopian), I'm going to say that only one 787 will be delivered this month.  There hasn't been any word on other 787s that will have their B-1 flight but I expect that at least 2 more will take to the skies for the B-1 flight before the end of July in order to be delivered next month (ZA100 and ZA135).

There has been raised hopes and expectations that aviation geeks around the world would see an avalanche of 787 deliveries starting this summer.  However we've seen only a trickle and I am at a loss to explain it. The Everett ramp is getting full of 787s that have either finished change incorporation or are airframes that do not need to go through the EMC but just have a few hundred small jobs left to be done.  As successive airplanes come out of 40-26 the number of jobs that remain have fallen to less than 150 with ZA182 (LN 70) for JAL.  This aircraft has yet to appear on the Everett flightline though it has been more than 9 days per line move on July 3, about 12 days ago.  We may yet see ZA182 as early as tomorrow or Monday. 

In terms of getting these planes ready for delivery, while the monster jobs of change incorporation have been completed on those airplanes, there is still a long line for delivery as these planes must go through the step by step process of pre-flight ground test, Boeing flight tests, customer flight tests as well as customer inspections and quality control reviews.  It appears that there doesn't seem to be enough resources to tackle all this work for the 8-9 aircraft that are lined up ready for their turn.  Both ZA508 (LN 51, JA811A) and ZA100 (LN 7, JA803A) were expected to be delivered this month to ANA. It's looking like on ZA508 will make it and there is rumors of extra work needed to prepare ZA100 for flight.  This is the aircraft that needed the most rework as it was the first production standard 787 to enter final assembly.  It is not known when this airplane is to finally take to the air.

In the meanwhile the first 787 for LAN, ZA536 (LN 68, CC-BBA) is now on the 40-51 ramp after being painted and is presumably finishing up some assembly tasks.  There is some controversy about when it is to be delivered. with some reports saying delivery is in August but LAN is saying that they expect to take delivery of its first 787 late this year.  Right next to is a 787 for ANA registered JA813A.  This is registration that was assigned to ZA510 (LN 59) and previously I had it listed as in storage and not undergoing any change modification.  I doubt that this airplane could have prepared to quickly though it is possible that this airplane may certainly have had some work completed while outside the EMC and it engines attached. I'm trying to find out the true identity of this airplane beyond the registration.  There are some late build 787, notably ZA118 (LN 67, JA816A) and ZA119 (LN 69, JA817A) that have "gone missing."  I'm assuming that these airplanes, if one of them is not the ANA 787 that currently is sitting on the 40-51 ramp, are in the paint hangar.

Lastly, it is quite possible that ZA262 (LN 49, ET-AOQ) for Ethiopian and ZA461 (LN 58, A7-BCB) for Qatar Airways could be ready for delivery by the end of this month.  The former has conduct two Boeing test flights (including the ferry flight to Ft worth) and is currently being painted in Texas. I would expect this airplane back in Everett in about 7 to 8 days. It could could still conceivably conduct customer flights after its return to Everett before the end of the month.  ZA461 is more of a question mark as Boeing needs to complete some interior assembly tasks (may be related to the IFE System) prior to further Boeing and customer test flights.  Again it is entirely possible that his airplane could deliver by the end of this month.

Don't even ask me about Air India.

787 delivery insight from CAPA

Center of Aviation has released it 787 delivery expectations for several carriers, including Air India.

To summarize, CAPA says that they do expect Air India to take delivery of the 3 787s that are parked at Charleston sometime this month.  We're still waiting word from the Government of India if they have approved the compensation deal between Air India and Boeing. I expect that the only other airline to take 787s this month will be ANA which has several that are ready to be delivered this month and next month.  Air India is expecting 4 more planes by the end of the year.

CAPA is expecting that Qatar and Ethiopian will receive their first 787s in August and thus far that looks to be the case as ZA262 (LN 49, ET-AOQ) took its first flight yesterday but still has to be painted. It should receive three more before the end of the year.  Qatar's first 787 (ZA461 (LN 58, A7-BCB) is finishing up its Farnborough tour tomorrow and returning to Everett that evening.  It will undergo further outfitting at Everett.  Qatar should receive 4 more planes by the end of the year.

China Southern will take its first 787 in August as well and will have a special scheme on it. IT should receive 2 more by the end of the year.  The three airplanes are still undergoing change incorporation with two of them inside the EMC.

United released images of the special livery scheme that will be painted on their 787s.  They're expecting their first plane in September reports are between September 15th and September 30).  It will receive one more in October, 2 in November and one more in December for a total of 5 by the end of the year.

Interestingly, the CAPA report says that LAN will get its first 787 in October.  Currently the first one is in the paint hangar, presumably being painted.  I don't know if this is true or if Boeing is going to hang on to the airplane until October.  It does look like it is ready for delivery though and LAN should take 2 this year and three next year.  There is one more currently in final assembly and one more should enter 40-26 by middle of next month.  I do think that Boeing could deliver one each month from August to October for a total of three. There are two more that are being stored on the flightline at Everett.

Lastly LOT Polish Airlines is slated to receive one 787 in November but there is one that is in change incorporation right now with four more slated to start final assembly between the end of July and middle of October.  Surely several of these airplanes should be ready before November?

Interesting we should look at the totals that are expected to be delivered for the aforementioned carriers:

Air India - 7
China Southern - 3
Ethiopian - 4
Qatar - 5
LAN - 2
LOT Polish - 1
United - 5

This adds to 27.  Add the 11 delivered so far and you're at 38.  I expect that JAL should get at least 4 more and ANA should get 6 more before the end of the year.  That is 48 total deliveries.  My target for Boeing is 50.  Clearly with Air India expecting to take delivery starting this month we can see a big 2nd half from the 787 in terms of deliveries of the airplane to customers.

More 787s coming out the door - June 22, 2012

Boeing is really on a roll in terms of getting 787s outthe door and prepared for delivery.  Tonight ZA536 (LN 68) will pushed out the door and parked on the 40-51 ramp to finish off minor assembly tasks before moving on to the paint hangar and then on to pre-flight.  This airplane will be the first one for LAN.   I'm not sure if the other airframes on the apron will be moved to make room for the third airplane.  Additionally, ZA262 (LN 49) for Ethiopian was moved from the Everett Modification Center to the Fuel Dock.  I suspect it will go through paint and fueling tests before moving out to flightline for pre-flight in the next couple of weeks.  Word is that we should see the first flight of Qatar's first 787, ZA461 (LN 59, A7-BCB) this Sunday but that is the rumor for now and nothing concrete as of yet.  Lastly, United Airlines confirmed that it will be receiving its first 787 in September.  More than likely this will be ZA288 (LN 53, N27904).  This aircraft is still in the EMC being prepared for delivery but recently had its GEnx engines attached.

Boeing asked to pay for Air India's mistakes and ineptitude

How much does Air India want Boeing to pay for AI's mismanagement and incompetence...$1,000,000,000.00.  That amount is equal to over $37mm per 787.  Now Boeing does owe Air India compensation for the delays but certainly $37mm is waaaay over the top.  What Air India wants Boeing to do is pay for years of bureaucratic mistakes and idiocy at the air line.  They couldn't even effectively merge Air India and Indian Airlines and the result is a huge strike that is financially hurting the airline.  Now Air India want Boeing to pay for the financial costs of the strike.

Air India, of course, has no where to go and at the end they will have to blink.  Boeing can easily deliver these airplanes to another customer though Boeing would have to hold on the the 787s while the BFE (buyer furnished equipment) is delivered to them for installation.  Air India would be without the fuel efficient aircraft it so desperately needs to remain competitive with Emirates, Qatar Airways and other international carriers and it will further hurt their bottom line.  I certainly hope that Boeing doesn't blink.  They shouldn't be held hostage due to Air India's extremely poor decision making.  Here's an Op-Ed from the New York Times regarding the Air India situation:

NYT:  Air India’s Boeing Showdown Could Be a Mistake

In other news, I got wind of the 787s that are in the EMC at Everett.  They are:

Bay C, ZA262, LN49, Ethiopian
Bay B, ZA382, LN43  China Southern
Bay A, ZA380, LN34, China Southern
Bay D, ZA287, LN52, United
Bay AW, ZA178, LN27, JAL

Quite interesting that ZA100, LN 7 is not there anymore.  I don't know where it is hiding but it was at EMC for a good long while.  I have to wonder if it's close to being delivered? Well we all know that there weren't any 787 deliveries in May but it could be setting up for a big June for the 787 program.  There should be 4 787s for ANA and 1 for Qatar that would be delivered this month.  If Boeing and Air India come to an agreement then that is another 3.  I also expect that the first 787 to go from assembly line to flightline would be pulled out in a couple weeks.  ZA135 (LN66) could sneak in under the wire to be delivered to ANA in June though the chances are remote but it would certainly be delivered by end of July.