Boeing’s newest 787 prepares to take off as Trump roils trade

On the day President-elect Donald Trump lashed out at Boeing for the cost of replacing Air Force One, mechanics and engineers at the planemaker’s South Carolina factory were focused on another challenge: making the first 787-10 Dreamliner.

The manufacturer is counting on the newest and longest Dreamliner to help turn its marquee carbon-fiber jet into a cash machine. So far, the -10 is meeting deadlines and hitting performance targets, a rarity in an industry where delays are the norm.

The question is whether a glutted market will crimp profit and sales — and whether Trump will further dent orders by raising trade tensions with China, a crucial market.

Boeing’s newest widebody is central to a plan to erase $27.5 billion in deferred 787 costs that were accumulated over a decade of losses. The first of three planned flight-test planes was loaded onto the final assembly line in North Charleston over the past week, achieving a production milestone ahead of plan.

“I’m very optimistic,” said Ken Sanger, a Boeing vice president overseeing development of the 787-10, the third Dreamliner model. “Without going into the numbers, the strategy is working very, very well.”

If all goes according to plan, Boeing’s most technically advanced jetliner will take its first flight over South Carolina’s wetlands sometime next year — Sanger won’t say when — and will be delivered to initial customer Singapore Airlines in 2018.

Boeing is counting on the -10 to mirror the drama-free development of the 737 Max and 787-9 three years ago, all products of a disciplined process it fashioned for new aircraft following the delay-plagued debut of the 787-8 five years ago.

The new jet is the most expensive Dreamliner yet, with a list price of $306.1 million, and its market entry should coincide with growing profits for the 787.

Boeing’s pricing has been thrust into the national spotlight. On Dec. 6, Trump tweeted that “costs are out of control” for planned planes to serve future presidents’ extensive security and cyber-communications needs. Costs are “more than $4 billion. Cancel order!” he wrote about Air Force One.

Trump singled out Boeing days after CEO Dennis Muilenburg called on him and Congress to ensure that U.S. companies have the tools to compete in a global economy. The Chicago-based planemaker, the nation’s top exporter and a major defense contractor, is under contract to build enhanced 747 jets that can transport presidents for decades.

With the new Dreamliner, Boeing faces turmoil in the widebody market that’s already pressuring pricing, and that’s before any collateral damage from the trade war that Trump has threatened with China. A glut of used Boeing 777 and Airbus A330 aircraft, fueled by high production rates and cheap oil, is stifling sales of new long-range jets, said Richard Aboulafia, an aerospace analyst with Teal Group.

While the stretched version has garnered only 154 orders — 13 percent of the Dreamliner backlog — Sanger said he is confident that -10 sales will gain momentum once airlines see the plane in action.

Early indicators are encouraging: Suppliers are keeping pace and building 787-10 components to the same quality standards as the -9, Sanger said. That’s crucial if Boeing is to build its newest jet without bogging down the two other 787 models, which combined are being built at a record monthly pace.

One key supplier is Spirit AeroSystems, which manufactures the 787’s engine pylons and forward fuselage sections in Wichita. The completed forward fuselages, which include a fully functioning and finished cockpit, are loaded onto modified Boeing 747s, called Dreamlifters, and flown to North Charleston or Everett, Wash., depending on the 787 model. Spirit facilities in Tulsa and Subang, Malaysia, manufacture parts of the 787’s wing.

The -10 is designed to haul 330 passengers in a frame spanning 224 feet. That’s 18 feet longer than the -9, which seats 290 people in a two-cabin layout.

The two models share about 95 percent of the same design-and-build processes. That means the new jet and its tooling will be familiar to mechanics in North Charleston.

As the first Boeing-designed jetliner built outside the Seattle area, the -10 is also a test of a strategy to diversify the planemaker’s manufacturing base. Boeing has steadily expanded since it acquired the campus from struggling 787 suppliers in 2009, and it has room to grow.

This story was originally published December 8, 2016 at 4:44 PM with the headline "Boeing’s newest 787 prepares to take off as Trump roils trade."