A report that Boeing has cleared a hurdle with US regulators that means it could soon resume deliveries of the 787 Dreamliner is a “major milestone” for the manufacturer which would unlock $17 billion of revenue, researchers at financial services company Morgan Stanley said.

A report by the US banking institution said approval to resume deliveries would be a boost for Boeing, but that the planemaker first had to make the required fixes.

The bank said there was a “sense of relief from investors and suppliers … considering how long the grounding has been, there was scepticism that the approval would happen so soon”.

‘Another lever for free cash flow generation’

“On Friday evening, Boeing received preliminary US regulatory clearance to restart deliveries of its 787 Dreamliner aircraft as the Federal Aviation Administration approved Boeing’s plans to inspect and repair tiny manufacturing flaws in the Dreamliner’s carbon-composite frame,” Morgan Stanley said.

“This is a major milestone for the business and unlocks another lever for free cash flow generation as 787 inventory stands at ~120 aircraft, which we estimate provides $17bn of revenue.

“We view this as a positive catalyst for the stock, but acknowledge Boeing must still make the required fixes and FAA inspectors must approve each aircraft prior to delivery.

“Deliveries of the 787 have been halted since May 2021, while Boeing slowed production to a minimal number of aircraft a month. We estimate Boeing will deliver 20 787 aircraft in 2022, stepping up to 66 aircraft in 2023 and 110 aircraft in 2024.”

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