Bloomberg News

Boeing to Ship Four South Carolina-Built 787s to Air India

April 27, 2012

Boeing Co. (BA:US) will ship all four 787 composite-plastic Dreamliners assembled this year in its new South Carolina plant to Air India Ltd., the carrier that demanded $1 billion in compensation after production delays.

The first of the jets rolled out yesterday from a 1.24 million-square-foot (115,000-square meter) hangar near Charleston, South Carolina. It will start flying in three to four weeks, and Air India will take delivery at midyear, said Jack Jones, Boeing South Carolina vice president.

“I know we’re a little late delivering this airplane, but when they get it, they’re going to say it was worth it,” Jim Albaugh, head of Boeing’s commercial airplane division, told employees and South Carolina politicians including Governor Nikki Haley and U.S. Senator Lindsey Graham.

After ending more than three years of delays in delivering the Dreamliner in September, Boeing is seeking to accelerate production of the twin-aisle jets to 10 a month by the end of 2013. Japan Airlines Co. and All Nippon Airways Co. have received 11 787s, said Marc Birtel, a spokesman. The planes list for $193.5 million.

The South Carolina facility, which cost $750 million and opened last year, will build 3.5 planes a month by the end of 2013 or early 2014, Jones told reporters.

Retaliation Complaint

The plant is Boeing’s first new commercial-jet factory outside Washington’s Puget Sound region, where the company was founded. Boeing’s decision to build in the state, which forbids requiring union membership as a condition of employment, prompted an accusation from the Machinists union of illegal retaliation for strikes.

The National Labor Relations Board subsequently filed a complaint against Boeing, then withdrew it after Boeing and the union reached a new contract promising that the upgraded narrow- body 737, the MAX, would be built in the Seattle area.

Albaugh declined to comment about any compensation for Air India. Last month, he disputed the Indian government’s statement that the planemaker agreed to pay $500 million in compensation because of delays to the jet, originally scheduled for first delivery in May 2008.

Air India demanded $1 billion in February, after saying in August 2010 that it would seek $840 million. Airlines sign up for delivery slots when they place orders, and Boeing faces penalties for late planes such as the 787.

K. Swaminathan, a spokesman for Air India in Mumbai, declined to comment today before a formal announcement regarding taking delivery of the new planes.

Production Increase

Assembly of the first 787-9 variant is scheduled to begin in South Carolina in the fourth quarter with work on the aft and mid-body, Patrick Shanahan, a senior vice president and general manager for airplane programs, said in an interview. The 787-9 is a longer version of the current 787-8 and can seat 40 more people at maximum capacity, according to Boeing’s website.

The 787-8 can carry 210 to 250 passengers, depending on the cabin configuration, and is intended allow airlines to serve long-haul routes with a fuel-efficient twin-engine plane instead of a four-engine jumbo jet like the 747.

Deliveries of five Dreamliners in the quarter through March helped push Boeing’s commercial-jet shipments ahead of rival Airbus SAS’s 131 as the Chicago-based planemaker works to retake the global commercial-sales title it lost in 2003.

Boeing is boosting production by more than 60 percent in the four years through 2014 to pare a record order backlog. The company reiterated its plan this week to deliver 70 to 85 of its 787s and 747s this year, with the composite-plastic Dreamliner accounting for “approximately half” of the total.

To contact the reporter on this story: Tim Catts in New York at tcatts1@bloomberg.net

To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net


Burger King's Young Buns
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

Companies Mentioned

  • BA
    (Boeing Co/The)
    • $121.82 USD
    • -0.47
    • -0.39%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus