Exclusive-Boeing tells airlines 787 deliveries to restart second-half 2022 -sources
2022.04.20 22:52
FILE PHOTO: The logo of Boeing (BA) is seen in Los Angeles, California, United States, April 22, 2016. REUTERS/Lucy Nicholson
By Eric M. Johnson and Tim Hepher
SEATTLE/PARIS (Reuters) – Boeing (NYSE:BA) Co has advised key airlines and parts suppliers that 787 Dreamliner deliveries would resume in the second half of 2022, a crucial landmark for an industry eager for a post-COVID recovery, three people familiar with the matter said.
Boeing’s swollen 787 inventory, amassed since it halted deliveries nearly a year ago over structural flaws, has locked up desperately needed cash and cut airline capacity.
Resuming deliveries is also key to Boeing’s plans for step-by-step 787 production increases in the coming months – vital to propping up a supply chain that has weathered successive crises.
A once-envisioned delivery target of April has already been pushed back to May with the expectation of further delays, the people said, as Boeing undertakes painstaking inspections and repairs for structural flaws in some 100 of the advanced composite jets, under scrutiny from more assertive U.S. air-safety regulators.
Boeing has stopped making public predictions on when it will win approval to resume deliveries. Boeing pegged the overall cost of the industrial snarl at $5.5 billion.
Two people familiar with the matter said that Boeing has told airlines that deliveries would resume during the second half of this year. One of the people added that a restart during the third quarter of 2022 was realistic. The people and other industry sources cautioned that targets have repeatedly slipped.
A Boeing spokesperson declined to comment, saying the FAA would determine when deliveries resume.
“As we’ve said, we are taking the time needed to ensure conformance to our exacting specifications,” the spokesperson said.
“Safety dictates the timeline,” an FAA spokesperson said.
In February, the agency revoked Boeing’s ability to self-certify 787 jets.
The FAA spokesperson added that it would retain that authority until the agency is confident that Boeing is building planes that meet its design standards, deliveries are stable and that Boeing “has a robust plan for the re-work that it must perform on a large volume of new 787s in storage.”
Investors will be eager for details on the 787 program when Boeing reports earnings on April 27.
The 787 problems have crimped airlines’ ability to ramp up capacity and triggered production rate cuts. That has hurt a supply chain already strained by the coronavirus crisis and the nearly two-year safety ban of the 737 MAX after fatal crashes.
Due to 787 delays, American Airlines (NASDAQ:AAL) Group Inc in February said it was suspending routes between Seattle and London, Los Angeles and Sydney, and Dallas and Santiago, among other operations changes.
American, which reports quarterly results on Thursday, declined to comment on the Boeing delivery schedule.
A United Airlines spokesperson referred to the carrier’s comments in January. United told analysts it originally expected to take delivery of as many as eight 787 jets in the first half of 2021, but that target moved to after the summer of 2022 – forcing it to cut capacity.
