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Boeing Cuts 787 Production After Latest in a Line of Production Snags

Image Credit: iStock, wolterk

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With its 787 Dreamliner jet plagued by production problems since August, it seems like Boeing has registered more unforced errors this year than the whole of Wimbledon.

Delays on the model have already cost the company $8 billion, and on Tuesday, the company disclosed its latest blunder: the main bodies of many jets weren’t properly joined near the nose, meaning Boeing will only be able to deliver half the Dreamliners it’s assembled thus far.

Talk about a botched nose job.

Holding Patterns

The wide-body 787 Dreamliner is in regular demand thanks to its lightweight composite construction that cuts 20% of fuel requirements on long-haul flights. But the model is also no stranger to production delays. Last August, deliveries were stopped for five months after Boeing disclosed some 787 parts weren’t joined to exact specs. And in May, Boeing was forced to temporarily pause delivery of Dreamliners after the Federal Aviation Administration raised concerns over its quality control inspections.

The latest issue, which hasn’t received an FAA recall and thankfully “poses no immediate threat to flight safety,” will slow production for at least three weeks and sullied an otherwise solid news day for Boeing:

  • The company said Tuesday that June was its best month for new orders since 2018, driven by a United Airlines order for 200 737 Max jets. It was also the company’s best month for deliveries since March 2019, with 45 jets relinquished to customers.
  • Boeing said it expected to deliver most of the 100 Dreamliners it had on hand later this year, but the latest product hiccup puts that up in the air.

Since most of the payment for an aircraft is made on delivery, hang-ups can be costly: Bernstein analysts estimated previous Dreamliner production delays cost Boeing $8 billion in cash flow in 2020 and 2021.

But while feeling the crunch on the production side, analysts forecast Boeing will finally report a profit in the second quarter — a welcome change from $20 billion in losses over the last eight quarters.

Airbusted: Boeing’s stumbles have allowed rival Airbus to reach cruising altitude: a year ago, the single-aisle jet market was evenly split between the two firms, but now Airbus controls 70%, according to aerospace analysts Agency Partners. In 2020, Airbus delivered three times as many jets as Boeing, and has delivered twice as many so far this year.