Boeing Says Plans for Stretched 787-10 Slow on Batteries

Boeing Co. said the grounding of the 787 Dreamliner after battery faults has hampered plans to begin selling a stretched version, called the 787-10, that had originally been expected to start last year.

“Clearly having the fleet down has slowed things down a bit,” said Boeing Commercial Airplanes President Ray Conner, who didn’t specify how much the program had been affected. “We would have been in much better shape from having people cross the finish line here.”

There’s “hopefully enough interest to be able to bring that forward soon” for board approval to officially begin selling the 787-10 as well as the 777-X, which will be an upgraded version of that wide-body model, Conner said today at a JPMorgan Chase & Co. conference in New York.

The 787-10 would be the largest variant of the Dreamliner, which has been grounded worldwide since January as regulators investigate battery faults following a fire aboard one airplane and an emergency landing by another. The 787, Boeing’s most technologically advanced airliner, has a backlog of about 840 orders with a catalog value of at least $186 billion.

The U.S. Federal Aviation Administration, which is reviewing Chicago-based Boeing’s proposed fixes to get the jetliner back in the air, declined to speculate last week about when the grounding might be lifted. Investigators still haven’t determined what caused the batteries to overheat.

Boeing is offering a redesign to add space and insulation between the battery cells and include a vent and hardened case to contain any fires, people familiar with the plan said last month.

‘Really Fast’

If the FAA approves the plan Boeing presented Feb. 22, “this will move really fast in terms of being able to get the airplanes back into the air,” Conner said. “We feel really good about the fix.”

An approved fix will have to be tested and certified, he said. Then the fleet of 49 jets delivered so far will get the upgrade kits, and finally the work will move to planes being produced, according to the executive.

A group of 200 of Boeing’s best engineers, including from its satellite and defense divisions, has accumulated about 200,000 hours of analysis and tests since the January incidents, Conner said. Boeing also put together an “impressive outside team” from other companies to make sure the planemaker’s search for potential causes is on the right track, he said.

“We’ve covered the waterfront, so to speak, in terms of all the potentials that are out there,” he said.

‘Very Comfortable’

Boeing still sees no reason to switch from the 787’s lithium-ion batteries to a different type, Conner said. “We feel very comfortable with the technology as it stands.”

Boeing fell less than 1 percent to $77.09 at the close today in New York. The shares have dropped 0.8 percent since Jan. 4, the last trading day before the 787 fire.

The company is continuing to increase production of the model, rising to seven a month “soon” and 10 by year-end, from five now, even though deliveries have been halted, Conner said.

“We see no reason not to do that, at least at this particular point in time,” he said. “That could change if something were to go sideways with the FAA.”

For now, Boeing’s January forecast of delivering more than 60 787s this year remains in place, Conner said.

“We should still be able to pull that off given the time frames we’re looking at,” he said.

Before it's here, it's on the Bloomberg Terminal.