Boeing's 787 Delays: Are There More to Come?

Analysts are split over whether the latest delay in the delivery of Boeing Co.’s (BA) new 787 Dreamliner will be its last.

In a note to clients, Citigroup Global Markets analyst, George Shapiro said:

The key point that keeps us believing there will be more delays is that over the course of three months the program has been delayed by another six months and the most critical time for the program is still ahead with flight testing.

On Wednesday,Boeing announced yet another six-month delay in the delivery of the fuel-efficient aircraft, saying it would now deliver the first 787 in the third quarter of 2009, 15 months later than originally expected. In addition, the company said it injected a two-month buffer period into the new schedule to allow for any further unexpected delays during its final assembly and testing.

Still, Mr. Shapiro, who has a “sell” rating on the stock, noted that the new schedule only allows for a nine to 10 month time period between first flight and delivery of the plane, versus a more normal schedule of 11 to 12 months “despite a much bigger change in technology.”

Joseph Campbell, Lehman Brothers analyst, however, disagrees. In a note to clients he said:

Our assessment is that this is the last of the Boeing 787 delays. Boeing shares may continue to be held down by 787 delays and new worries over the cycle, but we believe Boeing shares are cheaper than they should be.

Comments

[Sefo]

Bet on Boeing completing the Flight Test Campaign in 9 months? You would have better odds throwing your money in Las Vegas! No company has ever attempted such a bold FT program in such a sort time. Ask Airbus and its A380 FT program. Both planes are revolutionary products, and hence the FT program have to probe many uncertainties to FAA / EASA and also help them to discover design flaws before its customers do it after delivered.
The real nonsense is the part in which Boeing insist this further delay will not impact on its earnings. Bullshit! 15 months plus of wages, far more money spent in development and no income due to no deliveries.... Do the math!
Bottom line: something is very wrong with this plane. I bet on a new delay, but also on disturbing scoops about design not meeting contractual requirements. Overweight? Less fuel efficient as claimed? Will surely see.