On Tuesday, Boeing Co. (NYSE: BA) announced a delay in the first manned flight of its CST-100 Starliner space capsule until mid-2018, although it left unchanged the target date of December 2018 for the Starliner’s first trip to the International Space Station (ISS).
The delay confirmed an early September report from the National Aeronautics and Space Administration (NASA) inspector general. NASA’s and Boeing’s original goal was to send the Starliner on its first mission to the ISS in 2015.
The first orbital flight for the spacecraft has been pushed out from December 2017 to June 2018, and the first flight with a crew has been delayed from February 2018 to August.
Boeing’s network and space division posted revenues of $1.81 billion in the second quarter, down 7% year over year, and revenues of $153 million, up 1%. It is Boeing’s smallest division measured by revenue.
The Wall Street Journal reported that Boeing could take a loss due to the delay when the company reports third-quarter results on October 26. A company spokesman declined to put a number on the amount, saying only that Boeing is “assessing the financial impacts of the schedule change as part of the quarterly earnings process.”
Boeing was awarded a $4.2 billion contract for the CST-100 in 2014. NASA also awarded a contract for a similar spacecraft valued at $2.6 billion to SpaceX, the company founded by Tesla Motors CEO Elon Musk.
A report in Aviation Week outlined three main causes for the delay:
- Supply chain development production delays.
- A production flaw in the spacecraft’s lower dome that forced Boeing to scrap the unit just last month.
- Delays in qualification tests of minor components.
Boeing’s spokesperson said:
The lower dome is the critical path because it has all the avionics and environmental and life-support systems, so we are focused on getting that to the power-on stage. Of the 200 components we have to get through qualification, 80 are already through or in the middle of qualification testing. We are coming up that ramp on component qualification and have had no issues to date, which gives us a lot of confidence.
Boeing’s shares dropped about 1.5% on Tuesday and traded down about 0.3% early Wednesday morning at $133.30, in a 52-week range of $102.10 to $150.59.
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