Boeing delays 787 Dreamliner delivery to late 2010

WASHINGTON: Boeing said its much-delayed 787 Dreamliner airplane will be delivered to Japanese launch customer ANA in late 2010, more than two years behind the initial timetable.

"The first flight of the 787 Dreamliner is expected by the end of 2009 and first delivery is expected to occur in the fourth quarter of 2010," Boeing said in a statement.

Boeing had announced on June 23 a fifth delay in the 787 Dreamliner program to fix a structural problem on the side of the aircraft but had not provided a new schedule.

Japan's All Nippon Airways said it was dismayed and frustrated about the latest delay to the aircraft delivery.

"We understand the need to make the best and safest aircraft possible and appreciate that delays due to engineering issues of the current nature must be solved in order to move forward and achieve this," ANA said in a statement.

"However, as launch customer and future operator of the 787, the length of this further delay is a source of great dismay, not to say frustration," added ANA, which has ordered 55 of the 787 Dreamliners.

Boeing launched the Dreamliner program in April 2004 and initially had planned to deliver the first airplane to ANA in the first half of 2008.

Boeing said the new schedule reflected a previously announced need to reinforce an area within the side-of-body section of the aircraft and an additional several weeks needed to reduce flight test and certification risk.

"This new schedule provides us the time needed to complete the remaining work necessary to put the 787's game-changing capability in the hands of our customers," Boeing chairman, president and chief executive Jim McNerney said.

It projects a production rate of 10 airplanes per month in late 2013.

"The news was an encouraging sign of progress for investors," analysts said in a client note.

Shares in Boeing soared 8.36 percent to close at 51.82 dollars, the strongest gainer on the blue-chip Dow Jones Industrial Average.

The highly anticipated long-haul 787 aircraft is seen as key to the US aerospace giant's future. The company says it will use 20 percent less fuel than today's airplanes of comparable size.

Boeing is facing stiff competition in the aviation market from Airbus, a unit of the European Aeronautic Defence and Space Company.

Airbus is working on a new long-range A350 plane aimed at competing with the Dreamliner and expected to fly in mid-2013.

Boeing said it has 850 orders from 56 customers for the cutting-edge plane, which it claims is the "fastest-selling all-new jetliner in aviation history."

Airline companies that have announced cancelled orders for the delay-plagued 787 include Russian carrier S7, Dubai-based aircraft leasing company LCAL and Australia's Qantas.

The 787 Dreamliner is the company's first new model in more than a decade and features 50 percent plastic composites, compared with 12 percent on its 777s, helping lower fuel consumption.

Boeing said the 787 program was still on track to generate profits, based on the revised schedule and other estimate updates.

But it said the first three Dreamliner airplanes to be used in the initial test flights had been modified so much they would not have commercial market value beyond the development effort.

The Chicago-based company said it would take an estimated charge of 2.5 billion dollars, or 2.21 dollars per share, against third-quarter results which are to be announced in October.

"This charge will have no impact on the company's cash outlook going forward," the company said.