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Risks increase that Boeing will post cost overruns on 787 Dreamliner

Something to watch for on Boeing’s 787 Dreamliner program is whether Boeing will have to post forward losses on the program.

If Boeing were to declare a forward loss, it would mean that its costs for the 787 for a set number of aircraft would exceed the revenue for those aircraft. Boeing then would record a charge for the difference and record zero profits for those planes, said Barclays Capital analyst Joe Campbell in a new report.

Boeing’s $100 billion 787 Dreamliner orders make up 40 percent of the company’s order backlog.  It’s also about 25 percent of the Boeing’s revenue forecasts, the report said.

Once the company overcomes the new jetliner’s troubles and 120 of them are produced a year, “we believe the 787 has the potential to be the most profitable aircraft Boeing has ever had,” Campbell wrote.

But mounting costs from five program delays increase the risk that Boeing will conclude its necessary to declare a forward loss on the 787, the report said.