Boeing's Woes Mount on New Quality Problems
Boeing (NYSE: BA) hasn't been able to catch a break lately. The 737 MAX has been grounded since March 2019 due to well-known safety issues, the KC-46 military tanker has suffered major quality problems, and the COVID-19 pandemic has crushed jet demand. Unfortunately, Boeing still can't seem to get out of its own way. The company has recently acknowledged several production flaws affecting its 787 Dreamliner family that could prove costly, impeding its recovery.
The early history of the Dreamliner program was marked by massive development cost overruns, manufacturing problems, and production delays. Indeed, Boeing 787 production still hasn't broken even on a cumulative basis, let alone paid back its development cost. That said, in recent years, the 787 Dreamliner family has become a big cash cow for Boeing and an important contributor to the company's profitability.
The Dreamliner's surge to profitability in recent years came despite ongoing quality concerns, particularly related to poor safety practices at Boeing's assembly plant in Charleston, South Carolina (one of two factories that produce the 787 family at present). Many jets built there received faulty parts. Others had tools, metal shavings, or other debris inadvertently left inside the aircraft. Such so-called foreign object debris can represent a serious safety hazard.
Source Fool.com
