One hundred and twenty: that is the number of 787s that Boeing has in inventory and that it can now start delivering to customers again. According to Aviation Week and Reuters, the FAA has finally approved the inspection and modification plans that should close the book on the 787 production quality issues that have held the program hostage for two years and cost Boeing billions in earnings and abnormal costs. Boeing 787 deliveries to restart soon as FAA approves plans.
The FAA hasn’t confirmed the news reports, which are based on sources that Aviation Week and Reuters have spoken to. Bloomberg says that the approval is preliminary. Actual deliveries will only resume when FAA inspectors have inspected and rubberstamped the rework on each individual Dreamliner to make sure it complies with the plans. It is believed that the first 787s will be approved next week and join their customers from August 8.
Multiple quality issues
As we have reported here before, the production quality issues were actually multiple ones. The first was identified in 2019 and had to do with improper skimming of the composite rear fuselage sections, although the problem posed no safety of flight issue and involved only a limited number of aircraft. In September 2020, a skin flatness issue was discovered inside the rear fuselage barrels. Although again not a safety issue in itself, it could become that on the aircraft that had the first problem as well. Another problem had to do with the quality of titanium parts.
In its thorough review with suppliers, tier 1 supplier Spirit AeroSystems identified a skimming issue around the forward pressure bulkhead. of the forward fuselage Section 41. Later, quality issues were found around the doors of all 787s that were in inventory in Everett and North Charleston, which has become the sole Dreamliner factory since 2021. In November last year, a quality issue with the wings was found: they were contaminated with so-called PTFE or polytetrafluorethylene, which could affect the bonding process in an autoclave of composite sub-assemblies and parts inside the wing to the surface.
While Boeing briefly paused deliveries in late 2020 and resumed them in March 2021, the FAA stepped in as more details of the problems emerged. It result in the delivery pause in May 2021 that continues until today but will soon be lifted. In May, Boeing said deliveries could resume in July.
The whole of 2021, the FAA, Boeing, Spirit AeroSystems, and other suppliers have rigorously reviewed every detail of the production problem. The outcome was the inspection and modification plans, which Boeing presented to the FAA but for which the regulator denied approval as it wasn’t fully satisfied. In the meantime, rework had started on the aircraft in inventory, with Spirit saying in May that it was halfway through.
A question still not fully unanswered is why the 787 program ran into these quality issues anyway and only in 2019, some five years since the start of Dreamliner production? The skim issue was attributed to incorrect software settings, with automated systems approving the skims when in reality they were flawed. But why did a production process go wrong, having initially been right? Boeing nor Spirit have answered these questions.
Costings billions
The 787 problems have cost Boeing lots of money. In missed (pre)-delivery payments or free cash, in earnings, and in additional costs. Boeing said in January that it would take $2.0 billion in abnormal costs on the program, of most will be incurred in 2023. It said on Wednesday that abnormal costs in Q2 totaled $283 million, on top of the $312 million in Q1 and $285 million in Q4 2021. Deferred production costs have grown to $12.056 billion in Q2.
Boeing also lost customers, as the delays entitled them to cancel their 787 orders. This is believed to be a double-digit number. Those who stuck to their contracts will likely be compensated, as CFO Brian West indicated on Wednesday when he said that there will be “some variabilities in cash payments” when deliveries resume. The 787 backlog showed 407 aircraft at the end of June, including 69 ASC 606 Adjustments that are aircraft of which it is unlikely that the customer will take delivery.
American Airlines will be one of the first to get Dreamliners again and is counting on two in August and another seven until the end of the year. Lufthansa is also eagerly awaiting its first 787-9s, which it had hoped to get this spring. The German carrier benefitted from the cancelation of Dreamliners by other customers and announced in May that it would get seven in 2025 and 2026. In June 2021, Lufthansa also sourced 787s with Boeing at a discount price. British Airways is anticipating the delivery of more 787-10s.
Active as a journalist since 1987, with a background in newspapers, magazines, and a regional news station, Richard has been covering commercial aviation on a freelance basis since late 2016.
Richard is contributing to AirInsight since December 2018. He also writes for Airliner World, Aviation News, Piloot & Vliegtuig, and Luchtvaartnieuws Magazine. Twitter: @rschuur_aero.
