Remember Boeing's (BA) 787 Dreamliner -- the $166 million, 250- to 330-seat passenger aircraft with 865 orders and an estimated $150.6 billion backlog? Unfortunately, Boeing just announced it was delaying delivery to Japan's All Nippon Airways from December 2010 to sometime in the first quarter of 2011.

This is the seventh delay in a program that is already three years overdue. The previous deadline for ANA delivery was November 2009.

Back in July, Bloomberg reported that Boeing was likely to miss the December deadline, "as flight-test delays accumulate." But Boeing CEO Jim McNerney denied that there would be a seventh delay, even though 787 program head Scott Fancher said the flight would be delayed because of improperly installed tail parts made in Italy by Alenia Aeronautica SpA, according to the Wall Street Journal.

On Friday, the announced delay was attributed to Rolls-Royce, maker of the engines. Unfortunately, those $17 million Trent 1000 engines shredded during testing. The Journal reports that on Aug. 2, while the engine was being tested at a Rolls facility, it "suffered a major 'uncontained' failure, which did significant damage to the engine and the casing that houses it."

As I described in my book, You Can't Order Change, Boeing built the 787 in a fundamentally new way, without adequately anticipating problems with the new approach. Boeing decided to outsource 60% of the design and manufacture of the aircraft, and it made it out of a composite material that hadn't previously been used for large aircraft. In the past, Boeing had outsourced only aspects of manufacturing, not design, and it had used aluminum instead of composites.

While this new approach saved Boeing in up-front investment -- since its partners shoulder the cost of design until Boeing customers take delivery -- it put the burden of satisfying tight delivery deadlines on suppliers who have not previously proven themselves to be reliable. When push came to shove, many of those suppliers failed.

Furthermore, since the composite materials used in the 787 had not been used in an aircraft of that size, engineers were unable to develop software models to predict how the plane would handle the stresses of flying. This led to some unpleasant surprises, such as the discovery of cracks where the wings attach to the fuselage.

Boeing claims the new delay won't cost anything. But it seems to me that the company's credibility is shredded, just as surely as those Rolls-Royce engines.

Increase your money and finance knowledge from home

Economics 101

Intro to economics. But fun.

View Course »

Building Credit from Scratch

Start building credit...now.

View Course »

Add a Comment

*0 / 3000 Character Maximum

34 Comments

Filter by:
shyguy151

When they built the 777 they did it all inhouse with very little delays and very minor issues. The worst being a tail shimmy that was easily corrected. They used CAD engineering and did not evenhave to do a mock up. The problem is the piecing together of all the components between diffirent countries and a complete lack of responsibility on the management to do this inhouse. They are following the Airbus business model.

November 10 2010 at 10:24 AM Report abuse +1 rate up rate down Reply
billstrait2

soul sorry about this i think if you send this company CHINA with all of jobs there see if build these planes on time...... this company had bad management. bring back MC DONNEL DOUGLAS THEN YOU WOULD BE ON TIME......... because i should know i did work for then 25 years

August 29 2010 at 9:46 PM Report abuse rate up rate down Reply
woodmite8

THIS ISN'T A BOEING PLANE ITS A FRANKENSTIEN MADE FROM 10000 PARTS FROM 10000 COMPANIES WITH 10000 QUALITY CONTROL ISSUES. WHEN THE PLANE CRASHES THEY GET TO SPREAD AROUND THE BLAME TO SO MANY COMPANYS THE LAWYERS WILL MAKE RETIREMENT PLANS. MAYBE I AM OLD SCHOOL BUT I TRUST THE PLANE BUILT MOSTLY BY ONE COMPANY WITH A UNIFIED IDEA OF QUALITY AND TOTAL DESIGN CONTROL THE DREAMLINER SOUNDS LIKE A NIGHTMARE

August 29 2010 at 7:09 PM Report abuse rate up rate down Reply
1 reply to woodmite8's comment
ddavidrev1

It's a dream deferred, and hasn't Langston Hughes asked whether a dream deferred just explode? :)

August 29 2010 at 8:47 PM Report abuse rate up rate down Reply
frankcerank

If it aint Boeing I aint going

August 29 2010 at 4:56 PM Report abuse +1 rate up rate down Reply
spongeworthy06

So what if its delayed. Be thankfull they are taking the time to get it right. Lets hope Obama, the lawyer in cheif doesnt get involved and rush this thing to market on behalf of the trial lawyers. Lawyers just loooove a good plane crash, especially one with lots of people on board.

August 29 2010 at 2:30 PM Report abuse +2 rate up rate down Reply
jcopecaldwell

I'm not sure this aircraft will be safe. will the wings fall off. will an engine shred, flinging shards of hot metal into the passenger cabin? Will I be on board when one of these things happens? NOT!

August 29 2010 at 9:10 AM Report abuse -2 rate up rate down Reply
joeinbost

Boeing should just cut their loses and not even build it, unlike the Military contracts they can not continue to screw up. God help us if one goes down Attornies will look like Vampires

August 29 2010 at 12:39 AM Report abuse -2 rate up rate down Reply
1 reply to joeinbost's comment
dave and mary

The world changes and gets better because people dream and have visions. This airplane will be far more efficient than anything out there. But it's just taking longer than planned. Thomas Edison worked for years to make a light bulb. You probably blogged him too and said it won't work. Dream dude.

August 30 2010 at 8:20 AM Report abuse rate up rate down Reply
Lonesome John

I worked for Douglas for years until McDonnel bought them out. I worked for Rocketdyne for years until Rockwell bought them out. Then Boeing bought both McDonnel Douglas and Rocketdyne. Let me tell you Boeing picked up a lot of talent and great engineering know-how. I trust Boeing big time. But I do not agree with shipping so much of the work oversees. Perhaps Boeing will realize what a mistake this was and reconsider in the future.

August 28 2010 at 9:01 PM Report abuse +4 rate up rate down Reply
davidlw15

Boeing has made the finest line of commercial jet airliners since the late 1950s when it came out with the Boeing 707, now a fifty year-old jet with some still in service. Boeing is a fantastically successful company and a true example of American ingenuity and representation of Capitalism having made billions of dollars and employing hundreds of thousands of people. We should all applaud The Boeing Company!

August 28 2010 at 8:25 PM Report abuse +3 rate up rate down Reply
baruzamaruza

A very complex but simple solution to fix this and other manufacture problems. Allow competition to continue but let`s go back to doing things the way they used to be done and cut the third world labor market out of the picture all together. Let those nation develop their own resource and labor market for what ever it is that they do best and let`s get moving forward. In the end analysis, re-working out of tolerance aircraft components on a composite structure is not a viable second choice, it all winds up in the same scrap barrel, spending a thousand dollars to save one dollar tows companies under because of well planned out greed , it just never works out . This whole new world order or global manufacturing issue or what ever people want to term it is nothing more than trying to mate a giraffe with a frog, there is just to much conflict in nationalities and culture for strong healthy growth and progress. It`s not competition it is conflict in everything that is done and the long term usage of aircraft will show those stats in just a short term of usage. One thing i will give a positive to is that Boeing Airplane Co. is an exceedingly careful Company at what ever it is they do and sell.

August 27 2010 at 9:14 PM Report abuse +3 rate up rate down Reply