B787 problems cause another wrinkle for Boeing, Embraer trades down, Airbus gets A350 funds
Embraer and Boeing both suffered on Friday, falling 4.2% and 3.8% respectively. Boeing has been hit with more bad news about the B787, confirming on Friday that it had ordered subcontractor, Alenia Aeronautica, to halt production of B787 fuselage sections on 23-Jun-2009 (coincidently the day it announced the delay of the B787 test flight).
The halt is due to "microscopic wrinkles" detected in the carbon composite fuselage structure. The problem is not expected to cause any additional delays for the programme and Boeing has already ordered an additional layer of composite be used as a patch to solve the wrinkle problem on the first 23 production aircraft.
A new B787 test flight/delivery schedule is due before the end of 3Q2009, and is expected to be announced within the next few weeks, although Boeing is keeping quiet on when the announcement will be made. Suppliers have speculated that current side-of-body wing stress problems could push the programme back by another six months.
Meanwhile, Airbus’ A350 XWB programme received another shot in the arm, although perhaps not one that was quite as big as the manufacturer hoped. The UK Government announced it will commit GBP340 million (EUR400 million) in launch financing to help fund the aircraft’s estimated EUR11-12 billion development costs. Airbus had reportedly been hoping to extract anywhere from EUR600-850 million from the UK in support for the aircraft, but the UK Treasury has proved a somewhat reluctant partner.
Airbus has already secured around EUR2.5 billion in commitments from France and Germany for the programme, with Germany reportedly negotiating for a larger work-share for the aircraft. Spain is also expected to put up EUR300 million to support the development of the aircraft. Airbus had reportedly been hoping to secure EUR3.5 billion in launch aid from the four European states.
Embraer traded down in line with a generally weaker Brazilian stock index, continuing a four-day slump for the Brazilian aircraft manufacturer that has seen its share price lose 9%.
Selected Aviation suppliers’ daily share price movements (% change): 14-Aug-09