Odds and Ends: 787 likely grounded to May; More Batteries; Boeing’s 10K

787 Battery short-term fix: The Seattle Times has this story which recounts Boeing’s effort to design a short-term fix to get the 787 fleet flying again. The scenario outlined in the article suggests the 787 will be grounded at least until May. The story also paints a picture that if the grounding lasts nine months, production would have to slow and financial impacts will start to hurt Boeing.

More on Batteries:

The A350: Reuters has this story on Airbus’ switch from lithium-ion to current technology batteries.

The New York Times has this story about the different directions Airbus and Boeing are taking.

The Puget Sound Business Journal has a good story about the evolving technology of lithium ion batteries and even though the 787 is currently the world’s most advanced airplane, battery technology has advanced beyond the 787. PSBJ787Batteries

On Other Stuff

Boeing issued its annual 10K report on February 11. We were already engaged in the PNAA conference Feb. 12-14 and didn’t have a chance to read it until after the conference. The following excepts are from the 10K.

747 Program: The accounting quantity for the 747 program increased by 25 units in 2012, reflecting the normal process of estimating planned production under existing and anticipated contracts. We continue to incorporate changes identified during flight testing into previously completed airplanes. First delivery of the 747-8 Intercontinental occurred in February 2012.

The production rate increased from 1.5 to 2 airplanes per month in May 2012. Ongoing weakness in the air cargo market and lower-than-expected demand for large commercial passenger aircraft have resulted in pricing pressures and fewer orders than anticipated in 2012. We have a number of unsold Freighter and Intercontinental production positions beyond 2013. If we are unable to obtain orders for multiple Freighter aircraft in 2013 consistent with our near-term production plans, we may be required to take actions including reducing the number of airplanes produced and/or building airplanes for which we have not received firm orders. We also remain focused on reducing out-of-sequence work, improving supply chain efficiency and implementing cost-reduction efforts. If market and production risks cannot be mitigated, the program could face an additional reach-forward loss that may be material.

[787 Information]

[787 test airplanes]: During the fourth quarter of 2012 we finalized an order for one of the three remaining flight test aircraft. We continue to believe that the other two 787 flight-test aircraft are commercially saleable and we continue to include costs related to those airplanes in program inventory at December 31, 2012. If we determine that either of the remaining aircraft cannot be sold, we may incur additional charges.

[787 grounding]: We are unable to reasonably estimate a loss or a range of loss at this time because such estimates are dependent on the ultimate finding as to cause and the timing and conditions surrounding a resolution and return to flight. Any such resolution could have a material effect on our financial position, results of operations or cash flows.