When American Airlines formally accepted a new 787 from Boeing's Charleston, South Carolina, production site on Aug. 10, the manufacturer officially marked the event as the beginning of the end for a painful and expensive 14-month suspension of deliveries due to production-quality issues. But as Boeing's latest quarterly earnings revealed in October, the company's battle to recover from a rash of production problems that have plagued the program since 2019 will continue to be a burden for at least the next two years. Issues with surface-quality defects, shims, gaps and out-of-tolerance components twice brought deliveries to a standstill in late 2020 and again in 2021 and, despite fixes, remain a highly labor-intensive and expensive process to correct. According to Brian West, Boeing chief financial officer and executive vice president, just nine 787s were delivered in the third quarter, and 115 remained in the undelivered inventory. "The pace of deliveries from inventory going forward will be based on finishing rework as well as customer fleet planning requirements," he says. "We expect most of these airplanes to be delivered over the next two years." Boeing has already swallowed the bitter pill associated with the extensive rework costs and huge delays to deliveries, predicting overall losses of about $5.5 billion. As it stands, the company appears to be just over halfway through the worst of the financial effects of the quality issue. Commenting at the latest earnings call on Oct. 26, West said: "We recorded $303 million of 787 abnormal costs in the quarter, in line with expectations, and we still anticipate a total of about $2 billion-most being incurred by the end of 2023. These costs are driven by rework and production rates below five per month."
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