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Boeing 787 Delayed Six Months October 10, 2007

Posted by Andrew in Boeing.
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Grappling with supplier shortages and assembly difficulties, Boeing announced this morning that it was pushing back the delivery of the first production aircraft six months. Boeing CEO Jim McNerney sought to temper the news, writing that “notwithstanding the challenges that we are experiencing in bringing forward this game-changing product, we remain confident in the design of the 787, and in the fundamental innovation and technologies that underpin it.” According to Boeing, their earnings guidance for 2007 and 2008 will not be affected, but at the time of publication, Boeing stock had dipped 2.3 percent. Industry insiders have suspected a delay for some time, as “early last month, Boeing announced a delay in the planned first flight of the 787 citing ongoing challenges with out-of-sequence production work, including parts shortages, and remaining software and systems integration activities.” At the time, no overall delay for the program was announced, as there was time built into the schedule to accommodate the delays. That margin has eroded, and “while [Boeing has] made some progress over the past several weeks completing work on our early production airplanes and improving parts availability across the production system, the pace of that progress has not been sufficient to support [their] previous plans for first delivery or first flight.” Although Boeing has refused to comment specifically on the individual elements holding up assembly, it is widely believed by industry insiders that the aerospace giant cannot acquire enough titanium fasteners, the components that hold together the revolutionary composite frame of the 787. Learning from rival Airbus’ mistakes on the A380 program, Boeing has been more forthcoming about difficulties with the 787. While delays in neither program have been received favorably, both companies have pushed back the delivery of their aircraft to ensure that they are safe and perform to the expectations of their customers. Boeing plans to further address the delay of the 787 program in a conference call at 12:30 CST, today.

Source: Boeing Press Release