When Will Boeing's 787 Fly?

Could Boeing (NYSE: BA  ) be on the verge of keeping a promise? Finally?

On Thursday, the company's chief engineer for the 787 Dreamliner program stated publicly that Boeing is "just weeks away from" announcing a new delivery schedule for the troubled aircraft. On the one hand, this tallies with CEO Jim McNerney's commitment to provide an update on the schedule sometime "this quarter." On the other hand though, "weeks" appears to offer Boeing considerable wiggle room.

Stay within the lines
Boeing's fiscal third quarter ends on Sept. 30, which is a little less than eight weeks away. Its also less than two "months." So if you read between the lines, Boeing should be able to both keep its CEO's word for him, while also stretching this latest deadline to its limit.

Which I suppose you can view as good news. Boeing's disappointed us so many times already that I suspect shareholders will applaud if management can simply manage to color within the lines this time. But don't expect much more than that, because...

Supplier calls shenanigans
A few weeks ago, I briefed you on Broadpoint AmTech's dour prediction that Boeing won't have its 787 ready for primetime before late in 2010. A couple weeks after that, it was The Seattle Times that further contradicted Boeing, and warned that the 787 wouldn't be ready for so much as a test flight for four to six months.

This week, we received further confirmation that Boeing may be stretching the truth. The CEO of Senior plc, one of Boeing's parts suppliers in the United Kingdom, was quoted earlier this week warning that "a delay of up to six months is not unforeseeable." More disturbing still, Senior disputed Boeing's assertion that production of Boeing's other airplanes will be "close to current levels" in 2010. Says Senior: "Industry expertise don't believe them."

Foolish takeaway
When Boeing customers like Delta (NYSE: DAL  ) , Continental (NYSE: CAL  ) , and AMR (NYSE: AMR  ) doubt Boeing's ability to meet its commitments -- well, that's only natural. For one thing, they've been burned before. On the other, the more pressure they put on the company to deliver, the more likely Boeing will keep making its best efforts to appease them.

What should truly worry Boeing investors are comments like those we've seen lately: from analysts, newspapermen, and now the folks who really get hurt by Boeing's bungling -- parts suppliers like Senior, Honeywell (NYSE: HON  ) , United Tech (NYSE: UTX  ) , Spirit AeroSystems (NYSE: SPR  ) , who depend on Boeing doing its job so that they can do theirs.

If they're beginning to lose faith in Boeing, how can we do otherwise?

The 787 isn't Boeing's only problem, either. Read more about the firm's:

Start investing today -- just $7 per trade with Scottrade. Or find the broker that's right for you.

Fool contributor Rich Smith owns shares of Boeing. Spirit AeroSystems Holdings is a Motley Fool Hidden Gems selection. The Motley Fool has a disclosure policy.


Read/Post Comments (12) | Recommend This Article (14)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 06, 2009, at 4:32 PM, praizinplace wrote:

    Zzzzzz. Oh I'm sorry, did you write anything worth reading about Boeing? No? Just another shot at them while their stock goes over $45 today? It seems that everyone else in the world either doesn't read your column or they do, and then act opposite to your drivel...hmmm.

    Boeing is the best long term investment in the aerospace industry period. Proven stuff here, either buy now and hold on for the vertical ride after the 787 gets over its bad bumps or regret not buying after it gets back over $80+ and lose out. Your choice, but these guys have it way wrong...Fools? Indeed.

  • Report this Comment On August 06, 2009, at 4:51 PM, secondclass wrote:

    Boeing will sell over 1000 787s. Plus 150 more if they get smart and bid the 787 tanker the air force is dreaming of (and everyone else, including my dog).

  • Report this Comment On August 06, 2009, at 5:05 PM, JuliusCeasure wrote:

    Motley Fool or just plain 'ole fool? Are you trying to manipulate the stock price or is it just a case of cranial rectal inversion? Which do you recommend, Chrystler or Government Motors as an investment? Or are you just a hack for EADS?

  • Report this Comment On August 06, 2009, at 5:27 PM, AustinPowers007 wrote:

    Once again, the Motley Fool is relentless in its one-sided dissing of Boeing, voicing nothing but gloom and doom while completely ignoring the positives. MF did the exact same thing to Apple when it was trading in the 40s four years ago, claiming the stock was way overpriced! Here's some advice to MF readers: do the opposite of what MF recommends and you will be a very happy investor.

  • Report this Comment On August 06, 2009, at 5:38 PM, AustinPowers007 wrote:

    Here's an example of the Motley Fool's foolhardiness from early 1995 when MF called Apple way overpriced at $35 a share! Anyone who took MF's horrible advice back then would have missed out on a near quintupling of their investment.

    Here's the article, which is riddled with bad predictions about Apple's future:

    http://www.fool.com/investing/high-growth/2005/01/12/apples-...

  • Report this Comment On August 06, 2009, at 5:56 PM, austinwho1 wrote:

    Motley Fool does not have the slightest understanding of what Boeing is trying to do. The 787 will be the first large aircraft that is built from composite material. I am not surprised with the delays, and no one else should be. Boeing is not building a six to ten passenger aircraft here. Personally I am glad they are making sure that it is structurally sound, so day I may fly on the 787.

  • Report this Comment On August 07, 2009, at 12:53 PM, AustinPowers007 wrote:

    In my previous comment Motley Fool's bad prediction about Apple, the year in question was 2005 not 1995.

  • Report this Comment On August 07, 2009, at 1:23 PM, praizinplace wrote:

    Well Fools? Any response to ANY of these comments or will you simply post more fertilizer and move on with irresponsible journalistic dung?

  • Report this Comment On August 07, 2009, at 1:24 PM, estabank454 wrote:

    I see that MF is really one sided. I also thought that people should be forward looking, but they have to lead by the nose. Boeing looks like a win no matter what at these lows, even if it takes some time. But the question still remains for FORD, SIRIUS with cash for cluckers, you know it will work, but these stocks go up AFTER they report an upside. Wouldn't people jump at these and buy as soon as a catalyst is activated. Similarly for drug/biopharma's like CRIS. You see that larger companies have interest, wouldn't you think that one would establish a position before the logical numbers come in ???? The 787 will fly !!! Go Boeing.. before the numbers come in and before it flys !!!

  • Report this Comment On August 08, 2009, at 12:50 PM, TMFDitty wrote:

    Certainly, "praizinplace." I will be happy to respond.

    First and foremost, I freely admit that I could be wrong about Boeing. I'd be thrilled to be wrong, actually -- because I own the stock. That said, my record over three years of making public predictions shows that I am correct about twice as often as I am incorrect:

    http://caps.fool.com/ViewPlayer.aspx?t=01002844399633209838

    In contrast, not one of the posters shown above possesses a public record of his or her performance on caps.fool.com.

    As to the specifics of the reader comments... I have little to say, because none of the posters, yourself included, have stated any numbers justifying Boeing's current valuation. Whereas I have written several columns arguing that the valuation proposition is deteriorating, with numbers to back that argument up.

    Foolish best,

    TMFDitty

  • Report this Comment On August 09, 2009, at 8:37 PM, AustinPowers007 wrote:

    I find it very interesting that the writer of this article, Rich Smith (TMF Ditty), spews out nothing but one-sided negativity about Boeing yet he claims to own the stock and apparently has no plans to sell it right now. Well, put your money where your mouth is, Mr. Smith! If you really believe that Boeing's "valuation proposition is deteriorating," then why on earth are you hanging on to the stock? Talk about hypocrisy! How can you expect us to take you seriously when you don't even practice what you preach?

  • Report this Comment On August 10, 2009, at 12:08 PM, praizinplace wrote:

    Your response sir, condemns your argument. Nothing further need be said back to you. You claim to own a stock that you have consistently condemned and labeled "albatross, shell of what it used to be, etc". That, my fine feathered friend, is the definition of foolish. I am so glad that you posted your respone to solidify your column title. thanks again.

    AustinPower007 - excellent point sir, here here.

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