The good news is that the IAM strike is over and the union members are starting to return to work (all of them have to be back by November 10). The bad news is that two analysts take a negative view of the near-term future.
Bernstein Research has further downgraded its 787 delivery projections, according to ATW Online in this story.
Boeing held off predicting any potential impacts to the 787 line while the strike was underway, other than saying there is a day-for-day additional delay. Although this is the case, we believe the 787’s first flight will now be well into the first quarter. Boeing’s original timeline for a first flight was October 29; at the Farnborough Air Show, program chief Pat Shanahan predicted November. A 58-day delay takes the first flight to the end of December or end of January or later, depending on when in November Shanahan thought the first flight would be. If he was thinking the end of November, then the strike put the first flight at the end of January or February.
Ramping up the work schedule from the strike will likely further delay, suggesting perhaps even a March first flight. If any more technical issues surround the 787, this could slip the first flight to the second quarter.
ATW Online reports that Qantas expects an additional six month delay for its 787s. ANA now expects its first 787 delivery in 2010, says ATW.
Goldman Sachs returned Boeing to its “Conviction” Sell list, according to this report. Goldman remains concerned about economic conditions and the capital markets leading to deferrals that will depress Boeing’s delivery stream in the coming years.
China’s Big Three airlines report big losses and are seeking government money, according to this ATW Online report. JP Morgan cites ATW Online in reporting that China Eastern plans to defer airplanes, which will affect Airbus and Boeing.
News that China’s airlines are struggling and deferring airplanes is bad news. Airbus and Boeing each tell everyone who will listen that their backlogs are solid, in part because of the geographic diversity. China historically has been a rock-solid customer for both manufacturers, where deliveries were maintained through thick and thin. If China is hurting, the could well be the underpinning that belies the theories at Airbus and Boeing.
Update, 1:45 PM: American Technology Research doesn’t expect the first flight of the 787 until February or March. See this item from James Wallace at The Seattle Post-Intelliencer. This is in line with what we write for our Corporate Website update tomorrow. We also will report a 2Q09 first flight is not beyond the realm of possibility.