Boeing faces decade-long challenge in recouping 787 costs

How long will it take the Boeing Co. to work off the costs of developing the new 787? In September, Boeing handed over the first Dreamliner, more than three years behind schedule. And last month, company executives revealed the magic number: 1,100 jets. The company estimates it will take more than 10 years of production to reach this mark.

In today’s print edition, we created a graphic representation of those 1,100 airplanes and where they fall on the production calendar to help you visualize the challenge ahead for workers in Everett and South Carolina. It’s posted to the right as a PDF for download.

What follows is the description from that chart.

Accumulating costs

The program’s deferred costs, pegged at $9.7 billion at the end of September, will continue to grow until Boeing finishes developing the next version of the Dreamliner, the 787-9.

Recovering that cost of developing and producing the airplane efficiently depends on how quickly Boeing can increase the production rate to 10 787s per month by the end of 2013 at the factories at Paine Field in Everett and in Charleston, S.C.

Learning curve

Boeing workers and suppliers must quickly become more proficient at assembling the 787. This is a common phenomenon in manufacturing — the more you do something, the better you get at it. In the case of the most complicated mass-produced product in the world, Boeing estimates, it won’t be until sometime in 2015 when the revenue from each plane actually exceeds the cost of building it.

Order book

Boeing has 821 orders for the 787. That gets the company most of the way to recouping the program’s costs, but not all the way. It’s assumed the company will have no trouble selling more airplanes for delivery in 2019 and beyond.

Break even

Boeing spreads the total cost of an airplane program over a long period of selling and building airplanes — in the case of the 787, about 10 years and 1,100 deliveries. Chief Financial Officer James Bell says that’s roughly equivalent to the period of recouping the costs of the 777. But Boeing didn’t need to deliver nearly as many 777s over those 10 years to cover costs as it will 787s. Boeing delivered fewer than 500 777s in the first 10 years of production.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Local News

LifeWise local co-directors Darcie Hammer and Sarah Sweeny talk about what a typical classroom routine looks like on Monday, April 14, 2025 in Everett, Washington. (Olivia Vanni / The Herald)
Everett off-campus Bible program draws mixed reaction from parents

The weekly optional program, LifeWise Academy, takes children out of public school during the day for religious lessons.

Protesters line Broadway in Everett for Main Street USA rally

Thousands turn out to protest President Trump on Saturday in Everett, joining hundreds of other towns and cities.

An EcoRemedy employee checks a control panel of their equipment at the Edmonds Wastewater Treatment Plant on Thursday, April 17, 2025 in Edmonds, Washington. (Olivia Vanni / The Herald)
Edmonds launches technology to destroy PFAS

Edmonds is the first city in the country to implement… Continue reading

Over a dozen parents and some Snohomish School District students gather outside of the district office to protest and discuss safety concerns after an incident with a student at Machias Elementary School on Friday, April 18, 2025 in Snohomish, Washington. (Olivia Vanni / The Herald)
Parents protest handling of alleged weapon incident at Machias Elementary

Families say district failed to communicate clearly; some have kept kids home for weeks.

Irene Pfister, left, holds a sign reading “Justice for Jonathan” next to another protester with a sign that says “Major Crimes Needs to Investigate,” during a call to action Saturday, April 12, 2025, in Arlington. (Aspen Anderson / The Herald)
Arlington community rallies, a family waits for news on missing man

Family and neighbors say more can be done in the search for Jonathan Hoang. The sheriff’s office says all leads are being pursued.

Mary Ann Karber, 101, spins the wheel during Wheel of Forunte at Washington Oakes on Tuesday, April 1, 2025 in Everett, Washington. (Olivia Vanni / The Herald)
Lunch and Wheel of Fortune with some Everett swinging seniors

She’s 101 and he’s 76. At Washington Oakes, fun and friendship are on the menu.

Henry M. Jackson High School’s FIRST Robotics Competition championship robotics Team 2910 Jack in the Bot on Thursday, April 24, 2025 in Mill Creek, Washington. (Olivia Vanni / The Herald)
Mill Creek robotics team celebrates world championship win

The team — known as “Jack in the Bot” — came in first place above about 600 others at a Texas world championship event last week.

The Washington state Capitol on April 18, 2025. (Photo by Jacquelyn Jimenez Romero/Washington State Standard)
Parental rights overhaul gains final approval in WA Legislature

The bill was among the most controversial of this year’s session.

Snohomish firefighters appeal vaccine suspensions to Ninth Circuit

Despite lower court’s decision, eight men maintain their department did not properly accommodate their religious beliefs during COVID.

A rental sign seen in Everett. Saturday, May 23, 2020 (Sue Misao / Herald file)
Compromise reached on Washington bill to cap rent increases

Under a version released Thursday, rent hikes would be limited to 7% plus inflation, or 10%, whichever is lower.

A Mitsubishi Electric heat pump is installed on the wall of a home on Sep. 7, 2023, near Langley, Washington. (Ryan Berry / The Herald)
Kicking Gas urges households to get in line for subsidies while funds last

The climate justice group has enough funding to aid 80 households with making the transition to heat pumps and electric ranges

Everett Fire Department’s color guard Jozef Mendoza, left, and Grady Persons, right, parade the colors at the end of the ceremony on Worker’s Memorial Day on Wednesday, April 23, 2025 in Everett, Washington. (Olivia Vanni / The Herald)
Snohomish County officials honor Worker’s Memorial Day

Work-related injuries kill thousands of people nationwide every year.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.