Boeing takes $4.5bn hit as supply chain issues delay Dreamliners

Boeing has taken a $4.5bn (£3.3bn) hit after supply chain chaos sparked delays to deliveries of its Dreamliner jet.

The US manufacturer has struggled to take advantage of a post-lockdown recovery in airline sales because of a string of manufacturing problems, including fuselage panels that did not fit properly and other faulty parts.

The penalties Boeing was forced to pay to customers as a result pushed it to a third consecutive annual loss, of $4.3bn, although this was better than the $11.9bn which the company lost a year earlier.

The chief executive, Dave Calhoun, told CNBC: “None of us like charges. It’s a big one and it reflects our reality with the delays, the rework process we’ve been involved with and the time it’ll take to work the way through the process.”

The 787 Dreamliner, popular with passengers because of its quiet operation and with airlines because of its fuel economy, has been dogged by interruptions since the early days of its development. 

The programme has been stalled since last summer, Bloomberg reported, with about 100 planes part-finished in factories.

In 2013, the fleet was grounded because of a problem with overheating batteries which presented a fire risk.

The accounting charges take the cost of putting the Dreamliner back on track to $5.5bn. Boeing is in negotiations with the US Federal Aviation Administration (FAA) over what it needs to do to resume production.

Outside of the 787, Boeing managed to return to delivering cash for the first time since 2019 as it recovered from the $30bn cost of grounding smaller 737 Max jets following two fatal air crashes.

Analyst Rob Stallard of Vertical Research Partners said: “Just as we saw with the 737 Max, Boeing is now racking up massive charges on the 787 with no firm end in sight, and its fate in the hands of the FAA. 

“While no clear 787 guidance has been given, even the perennially optimistic Boeing is expecting another $2bn of production (ie cash) costs on the program, while we suspect that the $3.5bn charge could have cash implications down the line.”

Boeing was able to cut its debts by $4.3bn to $58bn. Shares dipped to about $199.

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