Boeing may increase 787 production

Production seen on track for fuel-efficient jetliner

NEW YORK - Boeing Co. may increase production rates for its new 787 model as airlines continue to place orders for the sought-after jet, a company executive said Monday.

Boeing currently has 490 orders for the 787 Dreamliner passenger plane, which has a list price of about $150 million, and the order book is expected to exceed 500 "in the not-too-distant future," Mike Bair, general manager of the 787 program, said on a conference call.

The mid-sized 787, which relies heavily on carbon composite materials to lower its weight and operating costs, is on track to make its first test flight in late August and first delivery in May 2008, Bair said.

Boeing said the 787 is currently sold out until 2013, and robust demand for the aircraft likely means that production rates will rise.

"We'll probably end up increasing the rates, driven by the intense market interest," Bair said. The company expects to build 112 airplanes in the first two years of production.

But Boeing won't increase 787 production before it carefully ramps up capacity at its assembly plant near Seattle over the next two years, and much depends on the willingness of suppliers to increase their own output, Bair said.

Boeing has outsourced the production of the fuselage, wingbox, and other key structural elements to partners, especially in Japan.

Fueled by demand for the 787, Boeing topped EADS-unit Airbus in new plane orders in 2006 -- the first time Boeing has bested its rival since 2000.

Boeing said the 787's development is on track in terms of timing, weight, and costs, but it was not going to rush the process.

"The airplane is ready to fly when it's ready to fly," Bair said.

http://www.msnbc.msn.com/id/17689714/