Boeing says its 787 aircraft will be ready for its first test flight by the end of this year and its initial delivery in the last three months of 2010, sending its shares higher as it gives some clarity to a program that has been delayed five times already.
Boeing originally scheduled the 787's first test flight for the fall of 2007. But production problems have forced the company to postpone trial flights of the next-generation passenger jet. The first delivery to Japan's All Nippon Airways Co. is now more than two years behind its original schedule.
After so many false starts, airline customers and some Wall Street analysts have become more skeptical of Boeing's timetable for the 787, built with lightweight carbon composite parts for fuel efficiency.
Chicago-based Boeing came under sharp questioning in a conference call Thursday after the announcement. One analyst, Howard Rubel of Jefferies & Co., asked why the company's latest schedule is "any better" than ones issued previously.
The establishment of the new test date appeared to reassure some investors, however, as shares of Boeing rose $4, or 8.4 percent, to $51.82 in trading Thursday.
Boeing said it will book a pretax charge of $2.5 billion, or $2.21 per share, in the third quarter. That includes a write-off for the first three test planes. Boeing had planned to refurbish and sell those planes, which have been extensively modified, but customers didn't want them.
Overall, the plane's delays are expected to cost Boeing billions of dollars in expenses tied to its halting development and penalties for breaking contract obligations to airlines.
With the 787, the company has adopted a new approach to building airplanes, relying on overseas suppliers to build huge sections of the plane that are later assembled at the company's commercial aircraft plant near Seattle.
That has stretched Boeing's supply chain around the globe and made it more difficult for the company to quickly address problems. Parts shortages, flawed materials and plane sections that didn't fit together properly have hampered production. The latest delay came in June, when the company said it needed to reinforce areas close to where the wings join the fuselage.
Still, the jet remains Boeing's best-selling new plane and a priority as it struggles with sharply lower orders caused by weak demand for air travel. Boeing currently has 850 orders for the 787. Seventy-three orders have been canceled so far this year. Boeing had about 213 orders for its 777 at the same stage in that airplane's development.
The company and some analysts say the 787 -- Boeing's first all-new jetliner since the 777, which airlines began flying in 1995 -- eventually will prove a financial and technological success.
"I am confident the team can address the remaining development challenges," Pat Shanahan, general manager of airplane programs for Boeing's commercial division, said during Thursday's conference call.
But not everyone is convinced. Troy Lahr, an analyst at Stifel Nicolaus & Co., said the new schedule is "achievable," but that the program has lost credibility.
"We're not holding our breath," he said.