The $30 billion bet that nearly broke Boeing: the story of the 787 Dreamliner

In the early 2000s, Boeing was losing. Airbus had the momentum: the A330 was selling everywhere, and in 2003 Airbus delivered more airliners than Boeing for the first time ever. Boeing's big idea at the time was the Sonic Cruiser, a near-supersonic jet that would save passengers about an hour on a long flight. The airlines, staring at their fuel bills after 9/11, asked for an aircraft that was cheaper to run instead.

So Boeing dropped the Sonic Cruiser and started on something much less glamorous: a mid-size widebody that would burn about 20% less fuel than the 767. Half of it, by weight, would be carbon fiber, and the fuselage would be built as huge one-piece barrels. Airbus later went the other way on its A350, building its fuselage from carbon panels instead.

All Nippon Airways launched the program in April 2004 with an order for fifty aircraft. By then it already had a name, picked in a public vote: the Dreamliner.

The bigger risk was in the business plan. Boeing decided to hand roughly 70% of the aircraft to outside partners. The wings would come from Japan, and fuselage sections from Italy, South Carolina and Kansas. The partners would also pay for their own development work, so Boeing would carry less of the cost. Finished sections would be flown to Everett in a modified 747, the Dreamlifter, and Boeing planned to put each aircraft together in three days.

Wall Street liked it, because it meant less capital tied up and bigger margins. One of Boeing's own senior engineers had warned, in a 2001 paper, that outsourcing on this scale could end up costing far more than it saved.

On July 8, 2007, Boeing rolled out the first 787 in front of about fifteen thousand people. The date read 07/08/07, and it made great television. Much of that aircraft was empty inside: many of its systems weren't installed yet, and parts of the structure were held together with temporary fasteners.

First flight was supposed to follow a couple of months later. It kept slipping. Sections arrived from the partners unfinished, with paperwork missing, and sometimes with parts that didn't line up. The partners had passed work to their own subcontractors, who had passed it on again, and Boeing could no longer see its whole supply chain, let alone manage it.

The 787 finally flew on December 15, 2009, more than two years late. Along the way, the company that had outsourced to save money spent around a billion dollars buying a struggling partner's plant in South Carolina to keep the program moving. All Nippon Airways flew the first passengers in October 2011, three and a half years behind schedule.

About fourteen months later, the 787 was in the kind of headlines no airline wants. In January 2013, a Japan Airlines 787 was parked at the gate in Boston when its aft battery caught fire. Nine days later in Japan, an All Nippon Airways 787 made an emergency landing after smoke came from its main battery, and the passengers evacuated down the slides.

The 787 relied on large lithium-ion batteries more than any airliner before it. On January 16, 2013, the FAA grounded the 787, and regulators around the world followed. No American airliner type had been grounded like that since the DC-10 in 1979.

Investigators traced the fires to a short circuit inside one cell that overheated the cells around it, a chain reaction called thermal runaway. What caused that first short was never fully pinned down, so Boeing's fix assumed a battery could still fail: each one went into a steel enclosure with a vent line that carries any smoke or fire outside the aircraft. The fleet was flying again in under four months, and the battery problem hasn't come back. Nobody died in either incident.

Boeing's original development budget was around $5 billion. By most estimates, development alone ended up well past $30 billion. On top of that came the cost of building the early aircraft slowly and inefficiently. Boeing parked those costs on its balance sheet, to be paid off over future deliveries, and at its peak that pile was also more than $30 billion. Plenty of analysts doubt the program will ever earn all of it back.

The 787 changed Airbus's plans too. Airbus's first answer was a modest update of the A330, and airlines criticized it so heavily that Airbus went back and designed a new aircraft, the A350. That story is on this site as well.

Boeing also opened a second 787 assembly line in North Charleston, South Carolina, and by 2021 every 787 was being built there.

In 2019 and 2020, inspections started finding tiny gaps where sections of the fuselage join, with shims out of spec and surfaces that weren't quite flat. Some of the gaps were about as thick as a sheet of paper, and they still fell outside Boeing's own standards. After the 737 MAX crashes, Boeing was under far too much scrutiny to let that slide.

Deliveries stopped. For most of two years, apart from one short restart, finished 787s piled up in storage while every aircraft was inspected and reworked, joint by joint. The FAA approved a restart of deliveries in August 2022. In April 2024, a Boeing quality engineer told a Senate hearing he believed the gaps could shorten the jet's fatigue life; Boeing disputes that and points to its own fatigue testing. The pause added about twenty months, and billions of dollars, for an aircraft that was already in service.

Through all of that, the aircraft itself kept winning over airlines. Around 1,300 have been delivered, and nearly 2,500 ordered. The design was built on a theory: that a mid-size jet with long range would let airlines skip the big hubs and fly directly between smaller cities. Boeing counts more than 300 new nonstop routes opened with the 787, and it's a big part of why you can now fly from a mid-size city to another continent without changing planes.

Passengers got the biggest windows on any airliner, a lower cabin altitude that leaves you less worn out after a long flight, and a quieter cabin. And in 2025, fourteen years after it entered service, the 787 had its best sales year since 2007.

On June 12, 2025, Air India flight 171, a 787-8, took off from Ahmedabad for London. In fourteen years and well over a thousand airframes, the 787 had never had a fatal accident.

The aircraft was airborne for about thirty seconds. 241 of the 242 people on board died, along with nineteen people on the ground: 260 lives. One passenger, in seat 11A, survived.

The preliminary report from India's Aircraft Accident Investigation Bureau says both engine fuel-control switches moved to cutoff seconds after liftoff, and the engines lost thrust. On the cockpit voice recorder, one pilot asks the other why he cut off the fuel; the other pilot says he didn't. India's government has since told parliament that inspections found no fault in the switch locking mechanism.

Why the switches moved is the question the final report has to answer, and this page won't guess at it. As of early November 2026, the final report had not been published; according to Indian press coverage of the Supreme Court proceedings, a draft was due to the court in a sealed cover in October 2026, and public release follows the review process required by international rules.

The aircraft did what Boeing designed it to do. It proved that an airliner made mostly of carbon fiber works, and it changed how airlines plan long-haul routes. Building it cost Boeing a decade of delays and more than $30 billion, and the damage to its reputation from the years that followed still hasn't fully healed.

There are 787s in the air right now. You can watch every one of them on the live tracker, compare the two long-haul rivals in A350-900 vs 787-9, or read the 787-9 guide for its cabins and seat maps.