787 new order development efforts gaining traction at Boeing

Drumming up new orders for the 787 seems to be improving.

Yesterday Bloomberg news reported that Boeing was in talks with Ethiopian to purchase 8 787-8 all of which would come from the stock of existing 787s already assembled and parked on Everett's Runway 11/29 or at the EMC otherwise known as the "Terrible Teens."

This is addition to the two terrible teens that Boeing has firmly sold to Air Austral the Reunion based vacation airline news of which I broke last week.  Boeing sold them LN 15 and LN 22.  The latter was to be delivered later this year but it now appears it will be delivered in May of 2016 while LN 15 will be delivered around October of the same year.

Getting 10 of these airplanes (out of 12) will be a huge boost to Boeing in reducing their inventory while the airlines will still be getting good fuel efficient aircraft at a fraction of their worth.

787s orders are not done as ANA still has to firm up 3 787-10 that they intend to take and QANTAS, who reported excellent earning today, are looking to firm 50 787 options that they hold for delivery starting later this decade.  Turkish Airlines is also expected to place an order for either the 787 or A350 this year which can be significant while Emirates  looks to choose between the 787-10 and the A350-900 possibly around spring to summer time.

Boeing is planning to increase production to 12 airplanes next year.  This increase is expected to meet not just new orders but conversions of purchase rights and options into firm orders by existing customers.  The options and rights need to be exercised by a particular date and with the existing firm order pipeline being filled, attention will now turned to the additional orders from existing clients.

787 February 2015 Mid Month Production and Delivery Report

A little more than halfway through February and Boeing has been producing 787s at the expected rate but  delivering aircraft to customers at a snails pace.  Through today, Feb. 17th Boeing has delivered 3 787s to customers.  They have started final assembly on 6 aircraft and rolled out another 5.

One bright spot is that Boeing is not sending the newly rolled out aircraft to the EMC which indicates that traveled work is less of an issue. Another bright spot is final assembly times.  These are trending downward with 787s from Everett now taking about 31 to 33 days for final assembly from 42 to 47 days while Charleston built 787s are at around 42 to 45 days down from 51 to 59 days.  Clearly the aircraft are coming out more complete and both Everett and North Charleston facilities are now getting more comfortable with the production process ahead of the planned increase to 12/month next year.

However, the trouble still lies in the delivery rate.  With only 10 aircraft delivered in 2015 it is way to low even for Boeing to meet its guidance of 120+ 787 deliveries.  Granted there are the usual delays because certain airlines continue to have issues like Qatar Airways that has 2 scheduled for delivery or Air India with their typical incompetent management trying to find financing for the delivery of a single aircraft.  It does appear that the bulk of 787 deliveries will again occur within the last week of the month.  I'll report back in early March to see how they did.

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

Air Austral orders 2 "Terrible Teen" 787-8

According to sources, Boring will deliver LN 15 and LN 22 to Air Austral, the French holiday carrier.  Air Austral had ordered but did not take delivery of 777-300ER.  It now appears that Air Austral switched the order for the 787-8. It appears they will take delivery on LN 22 this year and LN 15 next year.

This may be the unidentified order for two 787s that Boeing posted on their Order and Delivery website on Feb. 12th though I'm still trying to confirm this.

787 Line 11 first flight imminent

According to sources, ZA841 (LN 11, N507BJ) which is tentatively scheduled to be delivered to Korean Air Lines in April will attempt its first flight on Feb. 13th.  After this flight the aircraft will go into the paint hangar for about 3 weeks.

It would be the first of the "terrible teens" to have a fly after spending extensive time in storage and re-work.  It is rumored that it will be used by Korean Air Lines as a South Korean government VIP transport.

787 Production Looks to be improving

Analysis of 787 final assembly trends at Boeing's Everett plant seems to point to an improvement in the amount of traveled work that is reaching Everett.  Looking at the movements of recently completed 787s at Everett, I've noticed that, with the exceptions of 787s for Etihad and American Airlines, Boeing hasn't been sending rolled out 787s to the Everett Modification Center to finish assembly tasks that were delayed due to traveled work.

The last current production 787 that visited the EMC was ZA199 (LN 271, JA840J) for Japan Airlines which was there until early February.  Since then there have been 6 787s that have been rolled out to the 40-51 ramp but none have made the trip to the EMC though some have spent some time on the ramp outside the 40-51 building to finish minor assembly activities.  Currently, the only 787s that are at the EMC are 3 early build aircraft, the 3 787-9 flight test aircraft and one 787-8 for American Airlines.

With regards to American Airlines and Etihad, it seems that for the aircraft for those two carriers will continue to go to the EMC because of delays in delivering the premium seats from Zodiac until the production issues are smoothed out.  This is pretty good news for the 787 in terms of the production costs which Boeing has been wrestling with since the start of production.  It does not mean the end of traveled work as Boeing expects that to continue.  Many aircraft programs have some amount of traveled work but the 787 issues have been very painful, very public and very plentiful.  They will continue to have some amount of traveled work but it will eventually get to a point where the work can be completed in final assembly as opposed to being rolled out to the 40-51 ramp to be finished.

As always, I'll keep track of this trend but continued reduction of traveled work to a point where the airplanes no longer have to go to the EMC is very good news to the program.

January 2015 787 Delivery and Production Report

Boeing had a disappointing month as far as 787 deliveries goes.  Internally, Boeing is looking at 138 deliveries (publicly they gave their guidance as 124-127) which translates to 11.5 deliveries per month in 2015.  In January Boeing delivered only 7 787 to customers, far fewer than what is needed.  Annualized this would represent only 84 deliveries.  It is the beginning of the new year and Boeing has been a bit slow to ramp up activities after the Holiday season but they will need to make a much stronger showing in February and March.  The efficiency ratio was 1.43 which is way too high as deliveries did not match the number of aircraft rolled out.

The company did roll out 10 787s from it's 3 final assembly lines and started final assembly on a further 11 787 air frames to the flightlines though a number of them had to go the EMC.

According to the most latest information that I have, there are 15 787s tentatively scheduled for delivery in February including a number that were to be delivered in January.  It is highly doubtful that Boeing will deliver this number of 787s and I believe that in the best case scenario, they will deliver 11 to 13. Up to 6 of these deliveries would be the 787-9 including LAN's first -9 (via lease from AerCap).

Production rate is holding steady and it has taken Boeing an average of 102 days to build, test and deliver 787s (based on January deliveries not including outliers) last month.  Boeing needed an average of 5 test flights per delivered aircraft to complete the delivery process.

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 to curtail 787 surge line final assembly activities later this fall

According to analysis of final assembly activities for the 787, Boeing is planning to shift final assembly of some 787s currently being built on the surge line (in 40-24) to the main final assembly line in Everett and the North Charleston line.  Currently, Boeing assembling 4 787s/month on the main line in 40-26, 3/month on the surge line in 40-24 and 3/month on the North Charleston line in 88-30.

Around October, Boeing will reduce the number of 787 airplanes assembled on the surge line by 2 aircraft/month and reallocate 1/month each to 40-26 and the North Charleston line.  40-26 will assemble 5/month and North Charleston will assemble 4/month while the surge will still assemble 1/month.  It has been Boeing's plan to use the surge line as a temporary line while they got the North Charleston line up and running and increasing the production rate from 3/month to 10/month.

I believe Boeing has enough confidence in the North Charleston facility to to increase its production rate early.  Boeing is supposed to increase the North Charleston rate to 5/month in 2016 but it appears this may happen sooner than expected.  I do believe that in 2016 Boeing will shut down the 787 surge line reallocate the lone aircraft on that line to 40-26 and then when they ready to up the rate to 12/month, assign 1 each to 40-26 and 88-30.

The surge line is planned to be used for final assembly of the initial batch of 777X.

New 787 Tables for All Things 787

I created two new tables for readers to get a better sense of which customers and operators are getting their 787 from Everett and North Charleston.

The first one is 787 Build Location By Operator and the second is 787 Build Location By Customer.

You can bookmark these links as I'll be updating them as frequently as I get updates.

Boeing give 787 delivery guidance for 2015

Boeing released its 2014 financial results and while the company reported record earnings as well as higher 787 deliveries, it also reported higher deferred production cost (the gap of actual cost of production of each aircraft vs. the average cost over the accounting block which at this moment is 1,300 aircraft) had increased by almost $1bn over the 4th quarter to $26.149bn up from $25.189bn.  Year over year increase in deferred production costs was $4.5bn, an increase of almost 21% year over year!  Mush of this increase was due to increasing the inventory of parts as well as maintaining high employment levels within the 787 program.

Boeing’s 787 delivery guidance was reported by CFO Greg Smith as the annual production rate plus 3 to 4 early build aircraft.  This would mean a total delivery guidance of 123-124 787s for 2015.

However, one question that was not asked if this delivery guidance included the 3 787-9s that were used for flight testing and certification purposes. The big question is that do they consider the 3 787-9 that were used for the certification program last year as early build? If so, then are the only "early build" deliveries would be the 787-9s that are earmarked for customers this year?  If not then Boeing can deliver the 120 regular production + 3 787-9 from test flight + 3-4 early deliveries (terrible teens) which would add to 127 deliveries.  2 out of the 3 787-9 test airplanes are at the EMC being bought up to certification standards for delivery to Air New Zealand while the third is parked on a runaway at Everett. 

Boeing expect that the 787 program should become cash positive this year meaning that revenue for each delivered 787 will exceed the cost of production though the program as a whole will still be running at a loss.  Additionally, Boeing expect deferred production cost to moderately increase this year before declining next year when the 787 rate goes to 12 from 10.  Obviously getting a handle on production costs will include renegotiating (read: squeezing) the supply base as well as lowering labor costs within the program.  Greg Smith reported during the earnings call that 787-9 production costs fell 20% from the first delivered aircraft and 30% for the last 175 delivered 787-8 airplanes.

In other news it looks like Air Force One will continue to be a Boeing product.  The Air Force is going to negotiate for the delivery of three 747-8 air frames to replace the current 747-200 that have been in service for over 20 years but are dated.  This will be a non competitive acquisition but mission equipment and furnishing will be competitively sourced. The only question that remains is will they acquire a 747-8I or 747-8F?

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

American Airlines takes delivery of first 787-8 2 months late

American Airline formally too delivery of its first 787-8 today in Everett. The aircraft, ZA817 (LN 242, N800AN), will fly away for Dallas Ft. Worth tomorrow where it will be used for training before being pressed into service on AA's domestic routes initially in the 2nd quarter followed by international service later in the year. I expect that AA will take delivery of 11 more this year with the next delivery in February.

ZA817 was supposed to be delivered in November, 2014 but issues with seats took longer than expected due to issues with the seat manufacturer.

Even now AA 787s pulled out of final assembly spend some time at the Everett Modification Center (EMC) before heading to the flightline to continue the normal pre-delivery flow.

It is hoped that the seat issue will start to get resolved before it has a detrimental effect on future 787-8 deliveries to American Air.

787 Mid month report - January, 2015

Mid way through the 1st month of 2015, Boeing is setting it self up to deliver 10 787s. On the surface that may look like a good number especially when compared to January, 2014. However because several 787s that were supposed to be delivered late last year had been rescheduled to this month, there are expectations the deliveries in January were going to be higher than 10.  Earlier information that was received indicated 12 deliveries in January but now those deliveries were pushed to later in the first quarter.  Boeing needs to deliver a minimum of 11.5 787s per month for 2015 if it is to achieve its internal goal of delivering 138 787s.  As I had said in a previous post, I doubt that Boeing will be able to deliver 138 787s and the final number will most likely be between 125 to 130.

Thus far there are about 5 aircraft that are ready for delivery but there are also 1 more that need to conduct its B-1 flight which is a 787-9 for Virgin Atlantic and a 4 others that have yet to conduct their C-1 flights.  With 12 days left in the month it is possible for Boeing to all these aircraft tested and delivered but it will be cutting it close.  I do expect the first 787 deliveries of 2015 to start this coming week, thus again Boeing is making all its 787 deliveries in the last half of the month.

The customers that will be be receiving their first 787s include American Airlines and Scoot while AerCap (LAN) will be taking its first 787-9.

Line Number	Variable Number	Serial Number	Registration	787 Model	Customer	Operator	Delivery Date
240	ZB127	37112	9V-OJA	787-9	Scoot Pte Ltd	Scoot Pte Ltd	1/23/2015
241	ZA817	40618	N800AN	787-8	American Airlines	American Airlines	1/22/2015
250	ZA248	36291	VT-ANT	787-8	Air India	Air India	1/30/2015
252	ZA198	34853	JA839J	787-8	Japan Airlines	Japan Airlines	1/22/2015
254	ZA616	35263	C-GHQQ	787-8	Air Canada	Air Canada	1/30/2015
256	ZB029	37968	G-VOOH	787-9	Virgin Atlantic Airways	Virgin Atlantic Airways	1/30/2015
257	ZA222	36235	VH-VKI	787-8	QANTAS	Jetstar	1/26/2015
258	ZA846	36111	ET-ASG	787-8	AerCap	Ethiopian Airlines	1/30/2015
259	ZB224	35317	CC-BGA	787-9	AerCap	LAN	1/30/2015
260	ZA323	36426	G-TUIG	787-8	TUI Travel	Thomson	1/29/2015

In terms of production Boeing is well situated to roll out 10 787s (7 from Everett and 3 form North Charleston).  They are also starting final assembly on 10 787s this month with the same number as roll outs from each final assembly locations.

Interestingly, Boeing is looking to deliver 3 787-9 this month as well as roll out 3 and start final assembly of 3 787-9s this month.  I'll keep an eye on this but it does seem that for now, Boeing is going to keep the rate on the 787-9 at 3/month

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 South Carolina head Jack Jones announces retirement.

The head of Boeing's North Charleston' plant, Jack Jones announced his retirement to the Boeing South Carolina employees in an email message.  In it he intends to leave the company in May and will be on hand during the next few months to transition his responsibilities to incoming BSC head Beverly Wyse.  Currently Beverly Wyse is VP and general manager of Boeing 737 program and was previously the VP and general manger of the 767 program at Boeing.

Here is Beverly Wyse's bio from Boeing:

Beverly Wyse was named vice president and general manager of the 737
program in January 2010. In this position she is responsible for the design,
development, certification, production and delivery of the Boeing Next-Generation 737
airplane family. Wyse also is responsible for maintaining customer relationships and for
the safety and security of employees at the Renton, Wash., plant as well as its property
and equipment. 

Before this assignment, Wyse was vice president and general manager of the
767 program for more than three years. Wyse was responsible for all aspects of the 767
program as well as the Boeing Commercial Airplanes role in the competition for the U.S.
Air Force KC-X tanker program. 

Wyse previously was director of Strategy and Business Development for
Connexion by Boeing. In that assignment, she was responsible for coordinating the
development of the company’s business strategy and for identifying and pursuing new
market segments to expand the reach of the Connexion system. 

Wyse joined Connexion in August 2002 as director of Aircraft Deployment and
Installation, where she led a team responsible for the design and certification of the
Connexion service for installation aboard aircraft. 

Before joining Connexion, Wyse was director of program management for
the 757 program. She was responsible for all aspects of business operations and
program and project management. Before that, she served as a senior manager for
the Boeing twin-aisle airplane program management office. Wyse was responsible
for identifying which interior features would be offered to airline customers, for
delivery of interior systems and for project management of all new product
development. 

Wyse has a bachelor’s degree in mechanical engineering and a master’s degree
in business administration, both from the University of Washington in Seattle. She
graduated from the Boeing Executive Development Program in 2000.

Here is Jack Jones' email to the Boeing South Carolina employees:

Goodbye and Thank You
Today Pat Shanahan announced some leadership changes at the BCA Airplane Programs level. One of those included my decision to retire in May of this year.
 This was a bittersweet decision for me. I’m overjoyed to be able to spend more time with my wife, Karen, who retired from Boeing just last year, and do the things that we’ve talked many years of being able to do when we hit this stage in our lives. The other part of me is saddened to be leaving such an incredibly well-respected, successful corporation – one that has offered me amazing career opportunities in an industry that has been a passion of mine since early adulthood. 
 Throughout my 35-year career I have had the privilege of working on some of Boeing’s most iconic and challenging programs. The Boeing South Carolina assignment certainly qualifies as one of those programs, and has been one of the more challenging assignments I’ve had. However, thanks to you and this remarkable Boeing South Carolina team, and our unprecedented accomplishments in a relatively short period of time, I will leave with this being my most rewarding and satisfying assignment.
 Since my first day here in 2011, I’ve seen many positive changes, not only in production, quality and efficiencies, but in our teammates. Everyone at BSC is learning and growing, and doing remarkable things – turning dreams into reality at a site that just over five short years ago was two small suppliers surrounded by a lot of open land. Now look at BSC today! It’s truly amazing and each and every one of you is to thank for that.
                                  
Retirement was a hard decision for me, especially at a time when BSC is operating at an all-time high, firing on all cylinders, and proving to our early skeptics that we are truly Boeing Strong.  However my decision was certainly made easier knowing I was leaving it in the hands of a team I know well, and will never stop making this site the world class facility it is or ever retreat when faced with adversity. In other words … You Guys Rock!
 I know that you’ll continue to provide the same world-class support and attitudes to Beverly as she transitions to BSC’s new site leader over the coming months. I’ll be working closely with Bev from now until May and I have no doubt that with her long and successful history with our company and our products, combined with your talent, professionalism, and dedication, BSC’s future remains extremely bright and is in very capable hands.
 Again, thank you for this remarkable experience. I’ll be making rounds across the site with Bev over the coming months, and hope to see many of you face-to-face and shake your hands before my official exit in May.
 Jack

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

Undelivered Air Canada 787 heading to Iqaluit, Canada, Why?

So this morning, a lot of 787 watcher, including myself observed that Boeing is sending a 787 that is scheduled to be delivered to Air Canada later this month to Iqaluit, Canada.  I'm at a loss to explain why though I'm going to speculate.

Iqaluit has an airport that used for extreme cold weather testing of aircraft.  Boeing has done cold weather testing on the 787 so this may be additional testing of a fully kitted out Air Canada 787 being done for the airline.  The aircraft ZA616 (LN 254, C-GHQQ) was flown to Portland, Or. for painting and then to Boeing Field which is unusual except Boeing's Test Flight group is headquartered there.  It is possible that the test flight crews were fitting out the aircraft with test flight equipment and the engineers were running tests prior to flying to Canada.  Again this is speculation on my part but it's the best possible explanation.

787 2014 Year End Report - Boeing finishes 2014 with 114 787 deliveries

Boeing finished 2014 with a typical December delivery rush including handing over 18 787s during December 2014.  This is a new 787 delivery record which surpasses 15 787 that was delivered in June of this year in order to make mid year delivery goals.

Here are the 787 numbers thus far:

228 - the total number of 787 that have been delivered to customers since deliveries began in 2011
114 - the total number of 787s delivered in 2014
35 - the total number of 787s delivered in the 4th quarter
18 - the total number of 787s delivered in December, 2014
118 - the total number of 787s that started final assembly in 2014
120 - the total number of 787s rolled out the 2 787 assembly halls
10 - the total number of 787-9s delivered in 2014
104 - the total number of 787-8s delivered in 2014
1.05 - the efficiency of the 787 production system in 2014 (the number should be below 1 to indicate an efficient production system)
0.97 - the efficiency of the North Charleston final assembly
1.09 - the efficiency of the Everett final assembly (includes both the main Everett and surge lines).

Boeing overall did well on the 787 program in 2014 though it does remain to be seen how they've been able to handle deferred production costs. Boeing did exceed their guidance by 4 aircraft though they were planning to deliver 120 787s in 2014.  Several had to be deferred to 2015 for various reasons including the lack of seats for completed aircraft. The fact that the production efficiency is above 1 indicates that the the production system is still not stable.  The difficulties that with traveled work and the need to re-hire temporary workers in North Charleston highlighted the ongoing production system issues that continue to plague the 787 program.  Even now aircraft that have finished final assembly are still worked on to complete assembly tasks.

Still Boeing was able to flawlessly execute on the 787-9, as well as get the production rate up to 10/month despite issues coming out of the North Charleston campus with traveled work.  Deferred production cost has increased to over $25bn as Boeing stockpiled parts to mitigate shortages and reduce traveled work.

787s were delivered to first time new operators including:

Air Canada
Air New Zealand
Arke
Avianca
Azerbaijan Airlines
Etihad Airways
Kenya Airways
Royal Air Maroc
Royal Jordanian
Thai Airways International
Virgin Atlantic
Xiamen

Plus new BBJ owners

December's delivery count was unusually large due to the delayed delivery of several 787s to Avianca (4) and Azerbaijan Airlines (2).  Earlier this year I was projecting that Boeing would deliver 120 787s.  Several were deferred due to delays with seats as well as knock on effects from previous delays.  Notably American Airlines and Scoot were to receive their first 787s in 2014 are now expected to receive them in 2015.  One early build 787 for Korean Airlines (VIP) was ready for delivery in 2014 but is now taped and sealed at the Everett Modification Center.  The fact that this aircraft is not being worked on and is sealed indicates that there is an unknown issue(s) holding up delivery to Korean Airlines.  This aircraft is to be used as a government VIP aircraft and it is possible the delay can be attributed to the finished interior that is to be installed in the aircraft including classified military gear though this is speculation on my part.

Boeing has set it self up for a 2015 rather well but issues still remain including deferred production cost and continued traveled work.  If they are able to over come these issues then we should see a high number of 787 deliveries in 2015 compared to 2014.

Stay tuned for my 787 2015 look ahead which will be out soon.

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

Boeing meets 787 delivery guidance for 2014

With the delivery of the second 787 for Azerbaijan Airlines, Boeing had met their 787 delivery guidance of 110 for 2014.  The aircraft manufacturer isn't done and should be able to deliver 4 more 787s including 2 787-9s.  These aircraft all have had their first customer flights though there may be additional customer flights required and these should deliver starting early next week.

In a related note: Boeing pushed out the last 787 to be built in 2014.  The aircraft is for American Airlines and should deliver around March.

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 delivers first 787 to Avianca....finally

Update from my earlier post.   Avianca has finally taken possession of its first 787 yesterday.  The aircraft ZA665 (LN 217, N780AV) was reported at the Everett Delivery Center by sources. This indicates that the aircraft is due to depart from Everett soon.

This aircraft had a very long gestation period at Everett spending over 6 months from the start of final assembly to delivery at Everett.  It is suspected that there were seat issues but also financing issues that held up delivery.  Avianca is expected to take three more 787s before the end of the month.

Seats and Financing - hold ups to 787 deliveries in December

Boeing's aggressive 787 delivery schedule is being threatened by two issues: availability of BFE (buyer furnished equipment) namely the premium seats from Zodiac but more importantly the ability of certain airlines to fund the final payment to Boeing upon delivery.  Most of the aircraft's purchase price is paid upon delivery.  The seat issue has already shifted several deliveries into January.

For some carriers with less than stellar cashflow, obtaining the financing to fund this final payment has been tough.  In particular Avianca and Azerbaijan Airlines have had aircraft that are all set to deliver yet are still sitting on the flightlines at Everett and North Charleston.  The delivery dates have been repeatedly moved to the right and there hasn't been any further test flights nor any need for further test flights unless the delays take much longer at which point Boeing would have to fly a FCF (functional check flight) to make sure that the aircraft and it's systems still all check out.

Avianca has 4 787s on the flightline with 3 ready to be delivered.  Azerbaijan has both 787s that they ordered ready to be delivered as well.  The delays have been driven by the customers and not Boeing yet represents 6 aircraft that could be added to their year end and month end revenue totals.  Boeing is trying to keep the delivery schedule for these 6 airplanes in December and it does appear that they have time especially since the issues doesn't appear to be technical.