Boeing 787 delivery schedule could slip-experts

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Boeing Co is racing to complete tests of its long-delayed 787 Dreamliner in time for scheduled fourth-quarter deliveries, but some experts think that deadline is too ambitious and delays are inevitable.

A delivery delay for the revolutionary lightweight 787 would hinder significant cash flow for the world's No. 2 plane-maker after EADS unit Airbus. It also would further sully Boeing's reputation, which took a beating in the last two years as Boeing repeatedly put off the first Dreamliner test flight.

The plane finally took to the air on Dec. 15 -- an event that commanded attention around the world. With that milestone behind it, Boeing now must push its new plane through aggressive tests and out the door to eager customers.

"That's clearly the next big question," said aerospace analyst Alex Hamilton.

"Will it come as a surprise if that schedule slips? I don't think so," he said. "I think it's a well-accepted fact that it's likely to slide."

The 787 Dreamliner promises greater fuel efficiency through the use of durable, lightweight composite materials and would use 20 percent less fuel for comparable missions in similarly sized airplanes.

The first plane in the Dreamliner family -- the 787-8 -- would carry 210 to 250 passengers on routes of 7,650 to 8,200 nautical miles.

Boeing has carried out several Dreamliner flights, putting the planes through many tests that must be completed for the plane to receive certification from the US Federal Aviation Administration.

The company has trumpeted its progress every step of the way. On Wednesday, Boeing gave members of the media a tour of the interior of a fully-furnished 787, which is set for flight testing soon.

Scott Fancher, general manager of the 787 program, said he was "really pleased" with the way the flight test program has gone. He said issues are arising but being tackled as flight tests continue. Fancher gave no indication that the test program was behind schedule.

Boeing Chief Executive Jim McNerney said on a conference call with reporters and analysts last week that Boeing expects a 787 production rate of 10 airplanes per month by the end of 2013.

"The production ramp-up is also progressing as we prepare to deliver our first 787 late this year," he said.

Boeing has taken about 851 firm orders for Dreamliners from more than 50 customers around the world.

Exactly how much profit Boeing can expect to make from the plane is unknown. Analysts have said the company has invested more than $10 billion in the project and will have to give some sort of compensation to customers for late planes.

Scott Hamilton, Leeham Co consultant, said talk among industry watchers has been rampant in recent months that Boeing's test schedule for the 787 is too ambitious, considering the company's use of new materials and construction techniques.

"This program has been full of negative surprises," he said.

"The one thing that might work in their favor to meet that ambitious timeline -- if there was any silver lining after their delays of 2-1/2 years -- is that they were able to complete more testing than they would have otherwise," Hamilton said.

Boeing shares have risen more than 7 percent since the Dreamliner made its maiden flight on Dec. 15. Analysts disagree over whether news of a delivery delay would hurt the stock.

"I think if they missed the delivery by the end of the year, that would be a negative for the stock that I don't think the price reflects," said Ken Herbert, vice president at Wedbush.

But Leeham's Hamilton said Wall Street is well braced for another delay and the impact on Boeing's reputation would be minimal.

"Oh, that's so tattered by now that it will be a non-event," he said.