What’s Boeing to do as 787 takes off?If the company ramps up capacity to meet current demand, it might be left hurting if orders drop off later.

TACOMA, Wash. – The unprecedented popularity of Boeing’s newest airliner, the 787 Dreamliner, is creating a dilemma for company executives:
Should Boeing increase early production rates to satisfy the hunger for the new aircraft at therisk of investing in production capacity that could go unused when demand returns to more normal levels?
The revolutionary composite-bodied airliner is scheduled to enter commercial service in 2008. High fuel prices and pressure to lower operating costs have made the 787 a hot item among the world’s airlines.
Boeing has booked firm orders for 254 of the new jets and has secured commitments from airlines for more than 100 more.
And Mike Bair, head of the 787 program, said this week the company could snag even more orders if it could guarantee airlines early deliveries.
The company has tweaked its early production schedule to deliver about 112 787s a year in 2008 and 2009.
To meet that goal, the company will begin producing 787s at a slower rate in 2007 and parking those early planes until the aircraft passes its certification tests in 2008.
Getting ambitious with its production schedule could yield even more orders, but at considerable risk to the company and its suppliers.
New methods
Committing to a fast-paced production schedule with such a revolutionary aircraft could backfire if Boeing or its suppliers encounter unexpected glitches in producing the plane.
The aircraft is the first large airliner to be produced largely of composites rather than metal. Boeing also plans to use a new production scheme that calls for suppliers to produce large pieces of the plane that can be bolted together in three days at Boeing’s final assembly site in Everett, Wash.
New delivery
Large modules will be transported to Everett aboard enlarged 747 freighters. The airborne delivery system — which will gather parts from suppliers’ factories in Europe, Asia and the United States — is new to Boeing. Spirit AeroSystems in Wichita will be one of those suppliers.
New investment
Investing in tooling, creating facilities and training workers for a higher production rate may not be economical if the company has to throttle back production once the initial high demand was satisfied.
In the late 1990s, Boeing attempted a relatively abrupt acceleration

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