Boeing execs give update on North Charleston 787 plant

The first South Carolina-built 787 returned from Texas in June with its new red, white and gold Air India paint scheme. The plane has yet to be delivered to the South Asian national carrier.

Boeing executives gave the North Charleston 787 Dreamliner plant a mixed grade during the aerospace giant’s second-quarter conference call today.

They noted the local plant has been certified by the Federal Aviation Administration and completed final assembly of its first 787. Boeing finance chief Greg Smith spoke of significant improvements at the local plane-making complex.

But CEO Jim McNerney acknowledged the aft-body factory near Charleston International Airport is “a hotspot for us, and we’re addressing it.” Boeing plans to increase its 787 program production rate from 3.5 planes per month to five per month by the end of this year and up to 10 per month by the end of next year.

“I don’t think it’s a showstopper in terms of getting to rate, but it is something we’re focused on,” McNerney said.

The former Vought Aircraft Industries factory has long been a cause for concern.

It supplies major aft-fuselage pieces for every 787, which are assembled in Everett, Wash. and North Charleston, but the operation’s performance has been uneven. Boeing bought the factory in 2009 as part of a larger effort to gain control of its global supply chain for the Dreamliner.

But the unit is still a work in progress. Earlier this year, incorrect shimming traced to building 88-19 required fixes and delayed deliveries.

McNerney also noted that three Dreamliners sit ready for delivery to Air India on the North Charleston flight line. But in what McNerney called “machinations,” the Indian government, which owns that airline, has yet to grant final approval to the deal reached between Boeing and Air India over compensation for the years-late deliveries.

The executives’ remarks came a few hours after Boeing released its financial results from April through June, which were generally strong and well-received by analysts.

Boeing reported second-quarter net income of $967 million, or $1.27 per share, on more than $20 billion in quarterly revenues.

The majority of those revenues came from the Chicago-based aerospace giant’s commercial airplanes unit, which includes the North Charleston 787 Dreamliner plant. Boeing Commercial Airplanes brought in more than $11.8 billion in the second quarter, up more than a third from the April-through-June period of 2011.

Boeing defense unit saw an uptick in revenues as well although net income was down. Boeing also incurred a higher pension expense.

All told, however, Boeing’s quarterly results were good enough for the company to increase its earnings-per-share guidance for 2012 to between $4.40 and $4.60.

Boeing Commercial Airplanes’ backlog stands at roughly 4,000 planes valued at more than $300 billion. That includes the planes that have been parked on the North Charleston flight line for most of July. They had been scheduled for delivery by the end of June.

There was good news on that front Wednesday as well. According to published reports, the Indian aviation minister announced that a ministerial panel had approved a compensation package for the years-late deliveries of Air India’s 787s.

According to the reports, the Indian cabinet must now approve the compensation and that could happen as early as Thursday.

For more details, check back at postandcourier.com and in Thursday’s editions of The Post and Courier.