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Sunday, November 22, 
2:40 am

Boeing's Dreamliner remains in bed

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Boeing assembly line In this the summer of flight delays and cancellations, it is perhaps only fitting that Boeing Co. announced Wednesday test flights for its 787 Dreamliner will be pushed back as much as three months while it irons out continued manufacturing wrinkles relating to the much ballyhooed jet.

At stake in this case, however, is much more than just a plane full of disgruntled customers. Though it may be overstating to say that Boeing, with $64 billion in sales, has bet the company on the Dreamliner’s success, the plane is without doubt pivotal to the Chicago-based aerospace giant's future as a commercial aircraft maker. After all, the 787 is the first aircraft to extensively use lower-weight composite materials rather than aluminum, and the projected fuel savings have been popular with airlines who have already ordered more than 650 planes.

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Boeing on Wednesday said it would begin test flights in mid-November, back from the original target of late summer, blaming supply chain challenges and flight software refinements. The company said that it does not expect the delay to impact its bottom line, adding that it still expects to deliver the first Dreamliner on schedule next May.

Those assurances were enough to keep Boeing shares flat on the day, but the company is walking a narrowing tightrope. Boeing wisely built some slack into its timeline but now will burn through much of that extra time with this delay. And the company, which is using the Dreamliner to revolutionize its manufacturing process by outsourcing most of the production to vendors and simply assembling the planes in house, has already run into numerous hiccups trying to coordinate a supply chain that spans the globe from Japan to Europe.

Ironically, Boeing could have bigger problems down the line should it’s outsourced manufacturing strategy prove as efficient as it hopes. As DealScape noted in July, Boeing could be opening itself up to countless new competitors who lack the manufacturing scale once needed to produce commercial aircraft, but are armed with smart engineers and designers and a willingness to outsource assembly. —Lou Whiteman

See Associated Press story on Boeing's announcement
See Dealscape post on Boeing's long-term worries

Tags: Airlines, Boeing, Aerospace





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