Friday, January 31, 2014

2014 Goals And Objectives Boeing To Do List (End of Year Update)

The month of 2014 has punched the clock for clearing the deck from 2013. 648 aircraft were delivered and Boeing talks of going north of 700 delivered aircraft during this current year. They have not provided the first Months numbers for 2014 but will do so next week. A bench mark is delivering any 787 at all in January. They have delivered 4 and several more customer deliveries will be booked for January. February is lining up as a robust 787 delivery month. Without having any deliveries in 2013 for the 787 during the first three months. Boeing may gain a forty 787 advantaged from January through April over 2013.   Boeing proclaims it will exceed 115 787 deliveries in 2014. Possible, but we get to watch just the same.

The 737 is almost a lock on delivering 42 737 a month. Counting a lead time of increased productivity it will do well in sending out to customers close to 500 737's.
Whatever slack from that number for the 737, will be back filled with a high number of 777 going forward. In Boeing's greatest aspiration, is to produce 100 777's.

The 747 Frieghter and passenger is slumping in 2014 and has only a couple more years contributing to the revenue line on the balance sheet. The 747 production may come in at 18.

As feeble as the 767 order book, Boeing is counting on the military contract to make up the slack in a couple of years with its order of 188 767 tankers, becoming ladies in waiting. Basically Boeing needs to Identify a 767 a special commercial application for its 767 during the next few years. It should produce a low cost 767 with enhancements for specialized charter operations.  Adding 787 commonalities on the flight deck. Enhanced wing performance and new engine technology could give the 767 a new niche. A cost of operation and low sales price may breathe new life into a niche equipment market, otherwise its a freighter and secondary market hauler of people in less than prime markets. However, the bottom line is that the 767 is limping along until the military stuff starts. I don't know how Boeing will count that military delivery in respect to commercial output.

End of 2014 there will be a dozen commercial 767 delivered. Below is the score card for Boeing:

Boeing Goals and To Do List: Updated June 9,2015
Winging it Forecast    2014 Boeing results 12 months later
737- 480                           485
767-   12                              6
747-   18                             19 
777- 100                             99
787- 115                           114

Totals: 700 units              723 Actual

It may come in somewhat higher, but I am a bit conservative with benchmarks like this 700 number.

Boeing is counting on the new 787 groove it has found, hoping it will do well, and the 737 is being mailed in as we speak. The 777 is also dialed in for production. Boeing must contend with customers unable to take delivery, because financing and market adjustments. This could impede that number during certain times of the year. The risk of a 787 pause is high if another battery smokes. The 737 could run out of parts unless that is already in the bag for 2014. Anyway the sales progression is totally disassociated from delivery production in 2014. The backlog is too big. Sales must find ways of selling languishing models like the 747 and 767. Boeing stock would surge from unexpected sales for the two models, as it would pleasantly keep production sharp. Eventually, the models will have to retire. Even the A380 will retire before it is profitable.

This outlook is a thumb nail sketch of Boeing's cash register for 2014. Enjoy the WAG and use it for talking points, if you are a sixty second manager or managing by walking by expert.


Wednesday, January 29, 2014

What's Up With Those Rascally Machinist At Boeing?

Well labor has made a point behind closed doors and its not the closed doors in Everett, Wa. It is those doors in Charleston, SC. The non union workforce is toiling mightily with 787 production. Whether it's a problem of floor leadership, lack of experience or an under utilized work resource, the IAM in Everett is thanking Charleston at this time for developing a respect from Boeing, for those rascally IAM machinist.  I once was being  trained as a machinist in the Seattle area in a Walter Mitty type fashion at the Evergreen CC. My goal was to become a Boeing Machinist. I enjoyed the training and the work. The education was directly tied to making parts and solving problems in the metals arena. Even with the plastic plane you need great machinist.

My life's calling took me to another stage into an Management type of venue, for medical care then onto Governmental auditing and management.  Both somehow made a relationship with building stuff and solving problems. So I quit Evergreen CC and got my degree in accounting and finance at a great University.

Boeing sees harmony, Machinists disagree in aftermath of contract vote 

Back to machinist, making great stuff, is the best thing a person can do for anyone, so machinist, I solute you! Now, because of Charleston, SC experience, the IAM union has made points with Boeing. McNerney has approach the NW with a reconsideration towards the IAM folks. Smart business for both, the IAM and Boeing. Don't lose your best company IAM, Boeing don't lose your best doers, the IAM.

They desperately need each other to build the 777X. This is not real estate clambering for location, location and more location. Its war with the competitors. Boeing needs its best for the best, No more Ideas of cost trimming on the backs of an untrained or trained workforce. Boeing can't gamble with boardroom snarkiness.

Opinion, is what I do, because that is what you get from a lifetime of running from actual volcanoes exploding, revolutionaries, and political intrigue. Mexico is another story as well as my Mount Saint Helens camp out on May, 18 1980, And so goes the more flaws doings things with the federal government, during my time with the US Department of the Interior. Mexico was safer than Interior, I knew who the bad guys were even though shots are fired often in Mexico. I have seen a fair piece of the "behind shut doors stuff".  The IAM is in a good position to deliver its promise. Boeing is in a good place to keep its hand clasped with that partnership. I am really glad the IAM did not jump off the "Cliff" and I am glad Boeing is smart enough to put pride aside and build airplanes in Everett again with the 777X project. Having said all these remarks, places making future Boeing observations into context. Boeing pretends to work for the stock holders and pretends to accommodate labor. They, in the middle, must satisfy both masters at the same time while building aircraft. Of course the third pillar will always be Government, a place where I once experienced it with great trepidation. Being a Boeing exec is like being an NFL superstar, your only get paid when you play. If your knees don't buckle and need surgery you play on.

The machinist in Everett are discovering its true value in the market place. Its value is better realized as Airbus builds and sells more airplanes.

Tuesday, January 28, 2014

Boeing's FAA Audit, Its A Plan B

Since I was a Governmental Auditor and Audit Supervisor for a near 20 years, and they always say write about what you know. I will do just that, write about this impending Boeing/FAA audit at Charleston. Please note that Boeing has a plethora of problems ongoing at Charleston. It is "rumored that mid stage of the assembly process is a disaster. It is also rumored that assembly staff are not able to get its arms around the 787 in a sufficient manner. Even though they can eventually produce a 787 at the end of the day or year, they have much to account for in that assembly process.  The FAA is going in as if it were shooting fish in the barrel and then reporting they killed its limit.


Performance Audit Chapter 1:

Here is my take on this seven day audit? Seven days, are you kidding me, or what? 80 Auditors all dressed in, well, auditor garb.  Seven days to collect the facts from testing processes and systems and documentation that Boeing produces 787's. Seven days to interact with executives, 300 or more extras hired to assist the auditors from Boeing personnel. Egad, this sounds like a performance audit that targets a few areas under suspicion for problematic reporting, and aviation compliance. The FAA knows what it wants, and they have brought in the swat team of auditors and are kicking the doors down in Charleston, SC. 

Boeing please spin it as you will, but the FAA knows the answer before they ask the questions. The audit tests they are conducting are just validation of what they believe are happening on the factory floor. Even though Boeing is producing presumably safe 787's, they want to mop up the floor of those Boeing Keystone Cops blowing the whistles on the floor.  Because great assembly units are colliding in the factory and misplaced tools are ending up in the wrong sections of the factory, the FAA wants to know how a respected organization as Boeing, organizes the factory in this slapstick comedy of errors, before a 787 test flies around Charleston, SC.

The FAA senses, or more importantly fears that Boeing has trouble in Charleston where Boeing is getting this thing put together in a concise fashion. This audit is to prove and validate the building process and the voracity of Boeing's documents. With 80 auditors, seven days and 300 new Boeing audit specific employees, I sense trouble in the findings and recommendations.  Boeing has looked up the words "we concur" in the Boeing business thesaurus and do not like that suggested meaning.  It’s tantamount to falling on the sward and saying "we bad", sorry.

Audit test come in a variety of forms all seeking if a condition may be true or false. The audit team already have test constructed from pre audit information that suggest a problematic and common occurrence. Failures are hoped to be found and reported in findings validated per pre audit plan. Example:... it takes double the time to place a 787 on the flight line than what it does in Everett. That means something smells in Denmark and the audit team will find that answer somewhere in the competency level of the work process. A "we concur" answer comes on the audit response, means somebody gets fired at Boeing. Who, it is depends how long the audit footnotes are.

Findings:

If it’s a twenty word finding, against Boeing no one gets fired but remedial action is taken. If it’s a one page finding with an addendum, charts, and grafts or additional examples supporting the finding somebody gets fired.  Maybe a vice president change is coming in Charleston. A sacrifice, if you will to the FAA God’s.

Recommendations:

Or better stated as reprimands from the FAA, are the necessary statements leading to the "we concur" (where in Boeing's case it had not supplied to date).  The FAA recommends: "that Boeing get its act together in Charleston and fire the keystone cops as starters". Ahum, "We Concur".


Audit Response written by the Boeing legal team:

A ceremonial falling on the sward event kept in private. "After review of FAA Findings and Recommendations, Boeing has completed items 1-12 and installed a systematic process preventing error events from never happening again. These safeguards, guarantee that all instances cited by the audit findings, summarized in its recommendation will adhere to a strict compliance of the audit recommendation, and have already installed recommendations in the production environment addressing every finding."

Say what, never mind, it just works trust me?

The FAA will respond by: 'We will follow-up with another audit on a periodic basis insuring Boeing means what is says and says what it means audit format." Otherwise, known as a compliance audit.

Audits always pass in time, I know, I'm retired.

Sunday, January 26, 2014

Boeing Goals 10 787 A Month Coming Out Of The Factory I Say The Real Number is 8

What is proposed is taking a broader analysis for the ten that goes out the door just to sit on the flight line until delivered. Delivery is where the cash is transacted. Delivery means all work and testing are done.  In order to get a true number of 10 a month it would be better to toe the line at the delivery point rather than how long it took to assemble in the factory. Boeing should develop a 90 day moving average number which captures the true productivity until the actual delivery date, rather than cutting short of that number by counting what comes out the factory door at the end of the month. That number does not include all the shenanigans issues when sitting out doors  How does this moving average number work? It works by thinking about real events that actually impede or advance the progress towards the day Boeing would receive money or deliver the aircraft. Boeing's true target is delivering ten 787's every month to customers. To get there they analyze progress using a 90 day moving average of actual deliveries.

In order to explain this concept it is better to understand the back log. There are three basic categories that need inclusion in the inventory analysis. I don't care if 10 airplanes a month are moved out the door more or less. Nobody has been paid yet.

Consideration 1:

Boeing had 40 or more aircraft sit outside for several years from the three - five a month rate. All had or  has to go through the EMC (change incorporation center) before delivery. Therefore, those aircraft built at five month had acquired an immense sit time with no payment with more money poured into the hull of each aircraft over time. Appropriately, these should not be counted as a true monthly production number during that time.

Consideration 2:

Aircraft coming out the big aircraft doors sit on the ground during systems checks, upgrades and receiving corrections before test flown. They may sit on the flight line for up to 60 days before being worthy of delivery.

Consideration 3:

Customers are not ready for delivery, even if aircraft are certified for delivery. A customer may have money issues, training issues remaining unresolved, or just not ready to task the 787, so the airplane just sits for up to 30 days after test flights have been completed.

Boeing can build 10 a month and fill its parking lots with aircraft, but the job is not complete until it delivers. Therefore, the 90 day moving average takes all three major categories into consideration as part of meeting a 10 per month production goal.

Here is how a more accurate reflection is constructed. Count the raw deliveries each month. Average on a 3 month moving number, using the current month delivery number  and adding two prior months, providing an  average count based on deliveries not the actual productions coming out the door. Those out the door aircraft are not finished yet until delivered. This method asborbs all the anomalies of production and delivery.

If January had 8 delivered, it included all the above conditions even though production moved 12 out the factory door. In February, some of those january 12 are delivered after passing testing, and a few of those twelve remain in February inventory, because those "ready" made it through all the post assembly stop points, and finally, where customers who are ready to take it on for delivery, 9 787's sitting in a completion stage, were delivered because the customers were ready. So count February as 9.

Finally, March comes.  10 units go through the factory door and 12 are delivered from the standing inventory.  Add 8 + 9 +  12= 29 is divided by 3 (months 90 days) resulting 9.67 unit completion from a moving average for March. This accounts for all the bumps and jumps during that 90 day period. Making a moving average for April is simple. If April delivers 11 787 then the production moving average would include February for 9, March for 12 and April for 11.  The moving average for April is formulated as such  (9+12+11= 32)/3 for a moving average  production level for April of 10.6. Taking in the 3 considerations into account and averaging over a period of time smooths out the lumpy monthly performances in production and testing. It then matches that true output with customers delivery schedule by assigning a financial value on that output which is a handy number for stock-holders.

Later I will provide actual numbers for 2014 and demonstrate how this moving average calculation removes the clutter and confusion from those watching the production floor to the financial floor of the stock market over a year.

Thursday, January 23, 2014

Is The 787 Die Set?

Boeing is making a move by bringing hundreds more workers into its Charleston factory. The local press reports, "it maybe a result of removing all impediments from the manufacturing process and catch up productivity in advance of the 787-9 factory debut". A partially true observation.

Post and Currier Link

The Post and Courier reports the following:

"Boeing Co. is adding more contractors at its North Charleston 787 assembly plant, acknowledging unspecified "challenges" as it prepares to make a new, longer version of the Dreamliner.
The aerospace giant issued a statement Wednesday after The Wall Street Journal reported that the plant could hire as many as 1,000 temporary workers in South Carolina to speed up the completion of the mid-body fuselage sections that are outfitted at the local factory.
Boeing's statement did not address any production issues and didn't elaborate about how many contractors it might hire.
"The 787 production system is ramping up to historically high rates for a wide-body program and introducing a second family member, the 787-9," the company said. "It's not unexpected that this would cause a temporary surge in work."
A view can also be taken, that its not a production solution to add up to a thousand new workers, however the die has been finally set for the 787 program, and all hands on are called on deck. Boeing has a supplier parts validation problem, glitching the the 787. Fuel valves that fail and software under preforming are part of the culprits affecting the Dreamliner. Not a failure of the factory floor!

The production die is set, so bring on the troops in Charleston, and get them into production with training on its now frozen assembly method. The days of trial and error or tweaking on the floor is done. The re-engineering phase is also frozen. It time that the supplier effort achieves a standard of non failure in its parts. The new hires in Charleston emphazises Boeing change management is complete. No more broken parts or substandard applications. Boeing will be attacking those glitches to the source, found in its suspect supply chain. They need bunches of production troops for upping production significantly in Charleston and Everret to 10 a month.

The Boeing two pronged attack is focused on production levels, and the rapid response to all in-service failures. Fuel leaks, program errors and any other mishap is the other prong for the manufacturing attack. Reliability teams are in in attack mode. The production muster will address one phase, and the strict adherence of its suppliers will address the other, reliability. Norwegian Air, Japan Airlines and Air India has had its time in the barrel of the gun and this too will come to a close soon as problems put to bed. Always improving is not a statement not for always reinventing the 787 design. 

The up scaling of workforce in Charleston is a signal shot that the 787 is ready with its teething issues and growing pains. It is the lock and load command it has been waiting for these last three years. The battery problem is an isolated problem which will continue to haunt Boeing in the shadows as a creepy problem. Boeing has that monster in a containment box. The battery issue has been sent to the lab until further notice. The 787 flies safely with or without a battery. When the 787 is on the ground, its under its upmost battery workload. Making the battery  vulnerable. In the air, flying with its battery lock box is like life vests on a cruise ship. No battery no problem, because its in its cage and can fly without it.

Production enhancement is addressed by the latest hiring announcement, as well as the implication, that its time to bring in additional workers. Because Boeing is ready and has set its set production die, therefore it needs people for when all three 787 types are in the production play, making 10 a month.

Wednesday, January 22, 2014

40 Here 50 There, Pretty Soon Its A Full January Order Book for Boeings 737/Max/NG`s

Boeing just confirmed 40 from a "GECAS" order, then another 50 more are coming from Etihad (spin-off financing) for an airline, Jet Airways of India.

"India’s Jet Airways could be set to place an order for 50 Boeing 737s raising speculation that Etihad might be behind the deals."


Etihad Press Reference for 50 737 to Jet Airways in India

The Jet Airways deal is not complete from the sponsorship of Etihad, for 50 737, which would buttress the SE Asia market for an India Airline. I recognize this is a lot of stuff for the comprehension of the 737-NEO market battle, but it comes just after 2013 closes, and immediatly appears in the first weeks of 2014. Boeing is hot on the trail and closing the NEO gap over the 737. The customers are liking what is demonstrated by the Max and are using the NG as a Bridge to that future. The NG will continue to out preform the current A320 in service and Boeing will deliver the Max with greater performance than the Neo in the near future. Boeing is shadow boxing Airbus with the 737 and beginning to win orders in the later rounds.

Gecas has 40 737 for $4 billion Link

The 40 for Gecas is for 20 NG-8 and 20 Max-8

Boeing, GECAS announce order for 40 737s

CONTRACT MANUFACTURINGINDUSTRY NEWSJET ENGINES
GE's commercial aircraft leasing and financing unit confirmed as purchaser.

Boeing and GE Capital Aviation Services (GECAS), the commercial aircraft leasing and financing arm of General Electric, confirmed an order valued at $3.9 billion at list prices consists of 20 737 MAX 8s and 20 Next-Generation 737-800s. The order, booked in 2013, was previously attributed to an unidentified customer on Boeing’s Orders and Deliveries website.
"We ordered more 737 MAX 8s and Next-Generation 737-800s because demand continues to grow as our airline customers require more fuel-efficient aircraft to compete in the marketplace," said Norman C.T. Liu, president and chief executive officer, GECAS. "This order further strengthens the large GECAS order book."
The follow-on order increases the GECAS order book for the 737 MAX to 95 airplanes and the Next-Generation 737 to 387 airplanes, the most for both models by any company in the leasing industry.
"GECAS is an industry leader and this follow-on order reinforces the value of the Next-Generation 737 and 737 MAX in the leasing market," said John Wojick, senior vice president of Global Sales, Boeing Commercial Airplanes. "The 737 MAX will provide GECAS's airline customers with the best-in-class operating efficiencies and passenger amenities."

This should clear up the Boeing order book for end of January for 2014. A total of 90 more 737's are in play,  adding to the already 10 737's booked in January from Boeing's orders and delivery website. A tidy 100 in January is what I'm talking about!

Saturday, January 18, 2014

The 787 Battery Problem Just Got Smaller

What we now know, is that the fire containment and and ventilation processes protect the 787. We also know that a battery melt down still remains a problem. So what Boeing learned since this last incident with Japan Airlines.  Several things, the battery melted down with voltage controls in place. If the voltage controls worked as expected then it points to the battery core and construction itself. The battery was fully protected from every possible battery failure problem known at the time, except itself.  Boeing is now looking at battery x-rays for the determination of inherent flaws.  Boeing's robust treatment of battery habitat has narrowed the battery flaw to internals that pass by into Japan Airline 787 operations and onto the maintenance segment.

That can be said about the battery from an outside looking perspective.  The battery has a problem and it starts within the battery under limited influence from the airplane itself. Voltage regulation keeps the battery's electrical inputs constant and protected from electrical surges and anomalies, thus not damaging the battery core. Electrical out flows are regulated and do not require a tasking battery surge for keeping up with instantaneous equipment start-ups. The battery is protected after the fact of battery damage and thermal runaway.  Additional damage is stopped under operation once its starts smoking. The problem is isolated and contained.

So if all the battery protection works and contains thermal runaway it leaves a very big target on those factory x-rays on the battery before it leaves  for Boeing.  An airline gets a crack in its windshield. It gets replaced. An easy solution preventing windsield implosion during flight.  A battery has a crack at the molecular level no one cares until the battery containment system is called upon. Boeing will now have an easier time of identifying what is the causal problem of the battery.

Find a battery on the loading dock side of the battery factory with those cracks in its storage substrate, and test the battery until it breaks. Then you may find the causal problem for JAL's resting aircraft.  Multiple short flight cycles may stress the battery performance with multiple landings and take-offs each day, then followed by a long route. These are questions that may make JAL operations unique.  What happens to the battery exposure during a variety of operations and then rest? Are those battery "cracks" exposed and made over wrought with continuos service and then a runaway breakouts while at rest?

What is queried here there are now more questions, and less answers than before. Boeing, can possibly save the day on this venture, by getting its arms around the cause not the treatment. The treatment does not stop a battery  runaway from starting, it just stops it like a Herpes virus. A bad virus still starts up in the containment area. Boeing needs a cure for that battery design and its assumptions. I hope that x-rays finds the culprit even at the molecular level. It makes the problem a lot smaller.

Thursday, January 16, 2014

It's Time For The Litium Ion to Take Its Place On The Shelve

Boeing can no longer dilly dally on the Lithium Ion Battery (LIB) in the 787. As much promise  as the LIB gave the 787 over older battery design its impairment of melt down is bringing the whole 787 down on the ground. The advantage and more robust and lighter weight battery is out weight by the protective implementation of the safety measures Boeing has taken in making it safe but has not stopped the failure.

That failure alone is killing the dream and Boeing will have to swallow its pride and go to a heavier option that is available. The whole model is at risk from a temperamental problems that Boeing cannot not resolve even though precautions taken keep it safe in its containment box. A heavier battery system that will not behave like the LIB is needed . I believe Boeing is quickly reaching a transfer to that system and is writing a plan to retro fit its customers aircraft after testing of the new non LIB system.  A defeat for Boeing but not loosing the airplane war is more important, Until Boeing or its battery subcontractor can isolate the LIB flaw they should not propagate the installation until a solution is found. It is not know what causes the problem which is more important to Boeing to know while selling more 787. The risk is not retired. Until Boeing retires the the causal risk then it go to plan B.

A weight gain by a plan B battery system can be made up in added empty weight by that heavier system, by trimming more unnecessary weight out of the aircraft as it can.

Boeing has been working the plan B for some time and has nursed the LIB problem along for over a year.  It would interesting to note if plan B has already tested  on LN005 or 006 by now. That would be a major clue if those aircraft have flown with another type of battery pack.

If Boeing takes on new weight for a new solution, some of that weight could be countered by canceled, by eliminating the containment case no longer needed on an alternative battery. As far as the robust energy provided by the LIB, a plan B battery will need innovative power management for its replacement in order to keep up with the LIB promised performance. A set back, yes but not a game changer. Boeing really needs to address unfinished business by determining what causes the failure of the LIB battery under operation. They should also make sure they could change out the Battery Kit in a 787 with some straight forward inter changeability for the LIB and the plan B Battery both back and forth as a solution could be found within the LIB  and airlines could go back to the LIB  once root cause is found.  A big task, yes. But no more so than hundreds of other new technologies innovated on the Dream liner. A change out is needed for coming forward and backward as the 787 switches to various base systems from the batteries.

I am sure Boeing has reviewed every regretable plan to deal with this irepressable LIB and now needs to put that problem to bed until it is resolved. Boeing can no longer suffer further hang-ups with this feature. I don't know how a plan B battery would affect the all electric 787 systems.

Monday, January 13, 2014

The Commonality Is Called Kiwi Quality from Air new Zealand

Three Boeing Aircraft Classes, and One Airline Customer Goal. Its the Air New Zealand remodeling campaign. Customers, no matter how they book long legged runs will think they are always on optimum aircraft all looking and feeling the same. The 777-200 are going under refurbishment soon, where each -200 will receive the royal glove treatment. From nose to tail they will take out the old, 2005 and newer 777-200 interiors, and completely upscale that interior that will match, equal or exceed in some interior areas of its stable mates.. The mates include the yet to arrive until later in 2014,  787-9 and 777-300ER.  The seats on all aircraft and the room in each passenger space will have an Air New Zealand  trademark seating environment with all the amenities of the newest fleet member benchmark interior found on the 787--9. By next year if you get on a 777-200 then you will pleased to know you are experiencing a quality standard set by the latest seating innovation throughout the airline.

No matter  what, you could have one of these for the family:



Australian Business Traveller


Or one these economy seats for yourself:



But this will be the 777-200 new seating compliment that matches its stablemates; 
You know, the 787-9 and 777-300 ER. Now you know how crazy the Kiwis are getting in a good kindof way, then you have a seamless experience flying down under into the Orient. 

The only distinction that will be made is the sound of the engines or lack thereof the sound of engines. If the passenger takes off without knowing what aircraft type they are on, then Air New Zealand will have succeeded in lulling the passenger into complacency of quality no matter the model.

Sunday, January 12, 2014

Airbus Ponders Counter Punch With A330

Once again this is about Boeing with an Airbus angle on the line. Airbus has been placed on notice as the 787 matriculates out of Glitch University. The A330 was a bull- pen choice as Boeing fiddled away the years while dialing-in the new technology. The A330 filled that Boeing time gap supplying impatient customers who needed a mid sized two engine wide body with performance. The 787 has moved to the head of the class with Airline afficionados, as the A330 returns back to the bull-pen waiting a second call to pitch in relief in the big leagues. The 787 hopes to retire the A330.

Airbus is now looking at doing a A330 make-over with new engines and performance packages that would get the A330 competitive. They would not be able to announce a commitment for that consideration for another year.  By then the 787 will have 200+ flying 787's and maybe another hundred booked in sales. If a New A330 can approach the 787 envelop of operation, it may work for second level customers in a strategy for a cheaper knockoffs of the 787. However, the longevity of a remake option may have a short shelf life, and not giving a return on the investment idea through upgrading the A330 engine options. That concept would cost billions of Euros.  This is another Airbus decision that could be construed as a another  "Boeing made you blink"  (A350 project).  I would not advise Airbus or its partners, but it would be interesting if they brought forward a new and different set of wings with that decision, then they would get some serious interest from its customers. The Boeing 777X wings, 787 and 747 wings are exemplary of  world class wings. Airbus does not carry that wing swagger at this time.

Airbus should also bring forward some Euro innovation that can be installed while making the A330 a truely different airplane. They would want to incorporate a new technology suite that makes the old A330 obsolete in its operational arena.  Airlines now have a benchmark with the 787. All airlines that operate the 787 and its competitors who do not operate the 787 view that aircraft for what it can do, and new 787 orders will spawn from that reality. A new A330 has to be more than a customer loyalty purchase, just because an airline has other Airbus equipment in its fleet. A year of quiet operation for the 787 is going to be a very quiet sales year for the A330.

So what is Airbus up to as it plays its scattered model battle plan with Boeing, clear from its top end two engine wide body to the bottom end, the A330. The only two announcements available for Airbus is an extra extra wide body with more upolstry A350-1100 (EEWB)  and a New Operational Passenger Experience called NOPE A330

Friday, January 10, 2014

Its All About The 787 Boeing Customers From This Point Forward

The center of attention for the last  five years has been the 787-8 and now the -9. Boeing has suffered sales draughts at times, and then fire. The On-The-Fly development regimen is rapidly coming to close. Even though there will always be some continuous development needs as its customers robustly attack the passenger market place. Those numerous infractions on the aircraft will wash out in 2014. Reliability will once more become a term used for the 787. Part of Boeing's thinking was a quantum leap over its competitor, Airbus. They knew the various risks in 2005, but couldn't quantify those risks until it entered customer service. After two years of shaking out those glitches, here is what customers now count on when buying a 787.
  • Boeing will have the 787's back
  • Customers can count on the 787 to make greater profits and pull airlines out of financial Kaos.
The 787's are changing the airlines market footprint, greatly as the 787 is ready to take the market by storm by the end of 2014...
  • It will have 200 787's flying to expectations
  • The Airbus offering is a half measure of the 787

These are just a few talking point for consideration. Number one point is Boeing's bent on making sure customers have no adverse opinion for buying a 787. They will have the 787's back with an advanced team of engineers and mechanics that can solve any problem encountered. The 787, by end of 2014, will make reporting about Boeing problems a pinch tougher as those problems are quietly buried. If the publishers want to publish a book about the 787 glitches then they should because the writing material on that subject will dry up by 2015. Boeing has the 787's back and it is not going away. When both the aviation giants tale of the tape is read in 2016, the 787 remains the heavy hitter in the market place. Airbus will have to go back to the innovation board to beat the 787.

The profit addiction is effecting aviation board rooms. It just not the fuel savings that a 787 brings to a bottom line, its also the passenger customer appeal, the ability to extend routes, and the cheaper air fares. "Unfair", proclaims Airbus!  Oh well, the 787 is here to stay, deal with it. Just look at Ethiopian Airlines bottom line since adding the 787. Look at Air India dismal financial position from 2009 until now. Air India is now playing the 787 chips its has on the table, when they didn't have any of those chips to play with earlier. Air India flew to Frankfurt in 2010 and lost money every time they loaded its fares on to Germany. Now they need those 787's all the time.  In fact, Air India sold its 787s, just to take with same 787s back the next day as  leased aircraft. That is the chip they couldn't play during 2010 when they were financially broke. They will play these same 787 chips several more times to reach eventual profitably.

Foot print, as in Sasquatch. Air Canada can't wait. They will be receiving its first 787 by mid 2014. They will undercut foreign intruders from far and aboard,  when attempts from foriegn airlines  are made for coming efficiently or leaving effectively from Toronto. However, the 787 foot print will stomp the Canadian competition, safely leaving Canada and its World air space for; "Oh those Canadians" and other Canadian friends. This should be a model for other national carriers. They should follow on in like manner in order to salvage any national carrier's from alien predators. Norwegian Air, even though with its glitchy start is realizing 787 potential in spurts. Once all those pesky problems are treated, where Boeing has the 787's back, the glitches will terminate. Then Norwegian moves to the head of the class with its 787s. What the other customers aren't spouting off about, shows they like less attention towards its own strategy with the 787, and more attention about its own performance as an airline. Only when they buy another pot load of 787s will they speak up and make an obligatory statement; "Even though the 787 was grounded or having teething woes, this airplane has proven critical to our over -all success, therefore with great pleasure we will announce follow-on purchases of the 787 family line of aircraft."  That sentiment has already been stated as new 787-10s were ordered by various airlines

The end of 2014 will have satisfied those sitting on the sidelines, that the 787 is done with all its significant trials and will venture out and order a plethora of 787s. I would expect the new 787 customer category to grow as airlines order in band wagon like precision towards the end of the year. Boeing will grow its order book once again greater than its 787 production number of 100 units in 2014. Boeing needs to keep ratio sales to builds of over 1+. I would use a five year moving average ratio/ (calculation) over its second phase life of the program.

Boeing tells its sales team to keep the sales to delivery ratio above one.

Boeing  787 Five Year Moving Average Sales To Production Ratio

         2009   2010 2011 2012 2013
Sales -59     -  4     13      -12   182
Delivery                 3        50     65

Ratio calculation:
5 yr sales.        120
5 yr Delivery  118
Five Year Ratio 1.017

(anything above 1+ maintains a inventory buffer. The un-built inventory is virtually the same as it was in 2009 after it has 118 delivered units.)                        

This moving average summary for 2014 should stay at par with little change to the ratio. A good time for its continuous improvement  scheme.

  • Phase I was start-up period 1, since late 2011-2013, The Glitch AGE
  • Phase II is maturation with its customers 2014-2017, The Customer Age
  • Phase III, 2017... the Game Changer Age, claims a turn to reality through its customer's bragging points.
2014 will be written up as Boeing finally delivers its Dream.

That's how important 2014 will be for Boeing to have this bird meet customers expectation when signing an MOU for 787s. It is important for both Boeing and customer to share the customer's own dream of changing bottom lines for failing airlines, increasing the strategic foot print of an  airline who strives, for world relevance and defends its home turf. Finally, shore up mega airlines fight at the top with a multiple offerings from the duopoly of the giant framers that mega airlines seek.

As stated at the beginning of my writing participation back in 2012, I am taking on writing about just Boeing mostly, and other interesting aviation items. This exercise has been helpful for my critical thinking acumen and my enthusiasm for aviation. I chose the Boeing side of things and reserve the right to offer criticism towards Boeing as therapeutic treatment for my Boeing frustration. Airbus was never a favorite of mine, just because we live in a free country and I can write about my opinion on wings and things, hence the title, "Winging It", this has become an open digression on the Boeing company. I thank all who have ventured with me to read my inputs and I hopefully  can slender down my own glitches in writing. Only if you ever knew how far I've come to this point you would understand the effort in sharing these out  takes from aviation's Renaissance. I hope that 2014 will find  you smiling at my attempts to shine light on those things that also make me smile, think and write. After all it isn't about the money for me since its all deviously free. It all about those who share an interest in aviation and can't or won't chose sides. I've chosen mine and I'll probably go down with the ship when the order goes out from Boeing, to man the life boats.

Thursday, January 9, 2014

The 787 Is Baking In Alice Springs, Australia

The 787-9  is in over exposed mode during its stay at Alice Springs, Australia. Not only is the local airport important for ground heat testing. The frame needs to bake out above  38 degrees Celsius (100 F for Americans) just sitting there doing what the engineers want to see in its environmental systems.  This weekend on Saturday afternoon, Australian time and Friday late US west coast, Alice Springs will reach 40 celsious and make a complete outback test and fly an operational junket throughout the Australian outback where temperatures could reach 43 c or more degrees. In some areas of the outback that would about 110 to 115. A complete hot resting bake off, then start up systems in heat, and normalize the airplane environment which that test could be acheived on within the day. Plus a spin around the country side flying in heat to see what happens.

If you want to have an entertaining photo shoot of the Alice Springs 787-9 testing, then go to:

The Australian Business Traveller



The 787-9 is provisioned with testing equipment and 90 seats for all testing personnel. As an example Rolls Royce engineers flew on board with engine performance equipment on the long flight from Seattle to Auckland.  They went to Alice Springs this week to witness and document all climatic impacts on the RR engines.

It was noted in this article, that Boeing has relayed to its Business Journal that this was the final big series of test for the 787-9 when conducting these heat test in Australia. All testing for the 787-9 should be closed in on by April of 2014. When this 787-9 flies back to Everett Washington, it will conduct small issue testing with the other two 787-9 aircraft until it prepares delivery aircraft for Air New Zealand units through the US summer for fall delivery. In a short 10 months the Kiwi will have its first delivered aircraft flying customers. Exact customer delivery date has not been set until all testing is complete.

On board a right turn takes you to the racks of equipment



On board a left turn takes you to tight standard economy seats. Engineers don't have seat benefits on long haul work assignments.



Now back to those Rolls Royce Engineers. Here is their lair.



Photos supplied by Australian Business Traveller.

Sunday, January 5, 2014

Boeing's 2014 Strategic Must Haves and Should Be

The Strategic Audit is complete and 2014 will be a year of findings and recommendations for Boeing Airplane effort. This is a performance audit so don't expect financial errors or brilliant manipulations in the financial market reported on from 2013. It is an audit of strategic milestones and new bench marks predicting a 2014 out come and its relative position to its competitor, Airbus. So reading this report will enable a point of view on Boeing's 2014 potential achievements in order the it continues its repositioning in the market place by the end of 2014.

First is a quick review of 2013 findings:

It was found that Boeing  has a star player, The 787:




  • The Battery Fires found Boeing production delayed but not out.
  • The multiple glitches reported found the 787 indoors too many times.
  • Norwegian Airlines requested remedial assistance from Boeing
  • Japan Air Lines Slapped Boeing in the face with an Airbus A350 Order
  • Air India started acting like a real airline with Boeing's many 787 problems
  • 182 new 787 orders is an Indication the 787 is a sound and valued business venture.
  • Boeing is resolute with its 787 out of belief rather than the other option of "do over"


The second star player is the 737 MAX and it was found:




  • The 737 had an enormous year orders, about 797 orders and counting.
  • Design progress is an indication Boeing has a target better than the NEO
  • It was found that a sufficient number of customers agree.
  • Ryan Air has its own strategic plan using the NG (175 ordered)
  • Dual Flight Feathers is the new Black.
  • The 737 Max is doable and on time, not fashionably late with this model.


The Final Stars are the 777-8  and 777-9



  • Boeing found on paper it can beat Airbus with a wider aspiration in a metal body.
  • It was found that the right launch customer is the best recommendation.
  • More 777 orders are ready for 2014
  • The 777 is going to be built on the "Best of Boeing" called "wings and things".
  • 280 orders and commitments are on paper

2014 Recommendation:

Boeing must keep its head and not do "Crazy Ivans" in the boardroom. They have a well thought out strategy, "don't fix it if ain't broke" is your 2014 mission statement.
...................................................................................................
Now for the 2014 peanut gallery, "2014 strategic out look".

The 787 program will see a diminishing glitch factor in the program by June 2014 it will have to implement its marketing swagger, once again, by announcing the 787 is the "New Black" for airlines seeing red during 2013 when it grounded the 787. The 787 will have nearly 200 787 in the air by end of 2014, before the A350 is delivered. The question is, will Airbus carry the fear that the A350 can't match the 787 on any level? The reliability question will be retired and the 787 will reach its true fulfillment of the most advanced and reliable aircraft ever built. The 787 is the new standard for passengers and that they will measure everything against the 787. By year's end,  more aircraft from Boeing take-off with more people flying on them, also by the end of 2014 it could be said that Part I of the Boeing 787 Marketing Strategy will be anchored into the company's big picture game plan. Another 100 787's will be booked with confidence in the aircraft, its just not a good concept with amazing promise, its a reality with a budding legacy. The A350 and A330 becomes old before everyone eyes as the 787 dominance emerges. The press has to go back to school and learn new words besides "three years late" or "glitch". Writing it over 500 hundred times doesn't make a article worthy of a pay check.

The Max is the airplane no one saw coming and will surpass expectation before it is   built. Boeing is great at doing what it does, continuous improvement cycle will make the Max better than the paper airplane it sold to its customers. Boeing tends to error on the side of conservative estimates. The Max in 2014 will show in test it will exceed the sales pitch by several percentage points. The engine and aircraft refinements will make the NEO just a customer preference with Airbus not the lead in the Market. Another technological advancement on the Max will be revealed before the end of 2014 that will excite single aisle crowd. Boeing is secretly targeting putting its best with the best, i.e. Renton with the MAX and Everett and the 777. Boeing is going to fix Charleston in 2014-15  and turn it into an "Everett" like success it needs.

The 777 in 2014 will see ground  breaking infrastructure in the NW region with a wing plant and other ancillary production points needed for the program. Its not just for the life of the 10 year union contract, it will enable Boeing to go to the next stage in manufacturing advanced aircraft for both the military and commercial aviation. Boeing has a defense industry plan and new technologies developed in the commercial, share a military application when completed. The 777 technology is a synergistic core for other applications throughout the corporation. As is the 737 has been applied to the military and 767 is is new tanker program. Therefore, placing the new 777 in the NW supports Boeing's "other" ventures such as drone technology is found in commercial applications. Especially the zero visibility landing and take-offs for commercial aircraft. The NW in the future will become the US Air Force key resource center.

In conclusion 2014 will be a reconciliation year for the 787 and a hay maker year for the 737 and an ah ha moment for the 777-8 and -9 as customers really examine the the proposal, boosting another 150 sales beyond the the first 280 sold and in the file drawer. It is concievable that the 737 will continue sales numbers in 2014 where Airbus will realize that both the A350  and NEO will be second choice aircraft after customers make comparisons on the bottom line.


Saturday, January 4, 2014

Alice Springs Australia 10 Day Weather Forecast 787-9 Test

Are you an AV Geek? I am, so here is the 10 day weather forecast at Alice Springs Australia for the heat condition tests during next week. Next weekend they should run the AC and do its easy bake testing. Click on DETAILS for each days up to date information.

MonJan 6

Sunny
91°
64°
Sunny

TueJan 7

Sunny
92°
61°
Sunny

WedJan 8

Sunny
93°
64°
Sunny

ThuJan 9

Sunny
96°
68°
Sunny

FriJan 10

Sunny
98°
74°
Sunny

SatJan 11

Mostly Sunny
99°
75°
Mostly Sunny

SunJan 12

Sunny
99°
76°
Sunny

MonJan 13

Mostly Sunny
97°
76°
Mostly Sunny

TueJan 14

Partly Cloudy
99°
76°
Partly Cloudy

IAM Joins The Real World And Votes Yes For The 777X

The 51 to 49% vote to continue building airplanes for  Boeing, validates IAM workers love for buying  cars, having mortgages and gaining an education for its children. They woke up Saturday morning and could tell there children go ahead and pick out a prom dress and plan your senior trip.  Another IAM proposes to get married and an older IAM cashes in retirement and buys gold.  The NW Washington communities can now get back to doing what they do best, making Puget Sound greener than what can be made green by raising property taxes in 2014. "These are a few of my favorite things" shouting out from the Olympic range of mountains as Boeing caused the Union to blink, then think and by a slim 2% edge, confirm that $25 dollars an hour is better than 26 weeks of unemployment at $375 a week, is the only choice.  IAM has corporate's number and will at some point in time come back, and make the point, "we took a bullet for the team", mantra will haunt the newer Executives who will go 10 years into the future; A VP or CEO can make some serious cash before leaving in the next five years. They then will make those cheesy statements," it would be better to spend more time with the family at home and cash those bonus checks at work before a revisit comes forward in 2023 with the IAM.

Of course many things will have happened by then that will nullify the IAM. Boeing would be smart establishing an infrastructure of engineering schools and machining arts at a non union manufacturing cabal in order to blunt more Union agitation down the road. One thing Boeing could do is just fail to address labor in the long run and go fish off shore.  However, if they want to put Airbus away as a second tier manufacturer they really need to stop procrastinating with its people. In Boeing South Carolina (BSC) they run 12 hour shifts, hire raw worker unfamiliar with aviation and turn over a large workforce of burned out workers. That dog won't hunt any longer. They have to take care of its work horses. They need real leadership for its workforce, with both the labor and front office coming together in a plan. Management by memo or walking by is the way of the dinosaur when you delegate HR to hire 5,000 bodies to build 787's in South Carolina. After two years, they are worn out and can't put two 787's a month out the door correctly. The newly trained experience "walks" when exhausted after multiple 12 hour shifts. Labor force continuity begins to fails Boeing, as workers (newbies) are replacing burn outs who can do it, but not anymore.  The leadership failure in SC screams volumes and the failed strategy is exposed. BSC needed to successfully to deal with the IAM through a well executed labor plan. Do I need to say the obvious. Okay, I will. "The failure is in the leadership down to the floor." Cramming the factory with crazy shifts is a plan for failure. It has been studied and restudied, that 8-9 hours shifts are optimal for quality and production performance. Overtime or long shifts "only" work in burst of time. A twelve hour shift does not optimise the worker, but it may optimize some efficiency by having fewer shift transitions each day.

When a flubbed product comes out the door that effiency savings from fewer shift transitions are wiped out with great time and money. Thus resulting in only two aircraft a month, if lucky! A triage center is set up on the flight line. With hundreds of your best and most experienced workers scrambling around over and under airplanes that were moved outside to get them flight worthy. The talent is no longer in the building, it's out side receiving a repair project/updates as if it were somewhere in world broken down. That scenario is true and comes back on the leadership. Production management sucks in BSC. I know because I read the newspaper. Boeing needs its best leadership in this crises on the floor. It needs its best and most experienced machinist and engineers shoring up the product on the floor. The flight line needs to operate with a mop up crew with all its systems validation done out side.

Poor Workmanship must be retired in the factory. Last month they had a factory accident that caused Boeing to resuffle the whole line. It made several models out of sequence and delayed December production at a crusial time. The accident occured and significantly damaged the production aircraft.

My Questions:
  • Were the best people on the floor when this happened?;
  • Where were the leaders at the moment of the accident, were they outside ?
  • How long had the accident shift been running, how many hours?
Answers to these questions and other similar question may reveal my point that Boeing has given the IAM ammunition. The A Team is needed in BSC.