Wednesday, July 8, 2015

Airbus Takes Orders On as if Taking Water On Like A Torpedoed Tuna Boat

Boeing knew about 10 years ago it had to ramp up its production with all frames of its airplane types. Even though Boeing was on par with Airbus at the time for receiving new orders. The key to its retaining world's largest Aircraft builder, was directly inclusive of airline production. Boeing retooled all its production plants and published the feat of plant renewal for its customers. The backlog of unfinished aircraft after the 787 start-up, grew beyond a customers planning range. Boeing realized this was a very dangerous condition for its future sales.

Airbus  sales hubris possibly ignored Boeing's own realization of a backlog, worry, yet gloated on its A-350 and  NEO sales, as Airbus main talking points. However, did Airbus do enough on its production side for stemming Boeing's expansive capability when it recapturing the Title of "World's Largest Framer"? The answer is obviously "no", as Boeing mid-year 2015 has outstripped the Airbus air frame building and delivery pace. The Airbus web page is a mess to read, as it has chosen to feature number of orders and aircraft since the beginning off time through Airbus' delivery on June 30, 2015. A reader needs to dig a little deeper to ferret out accurate numbers for the first half of 2015. Airbus delivered 304 frames in the first six months without my differentiation in monetary value or or class of aircraft.

Boeing on the other-hand delivered 381 frames which exceeded Airbus by 77 units. The number also represents about 13 units a month more than what Airbus produces. Boeing is now focused on lean production techniques in all of its massive plants. In fact they will increase its production in a continuous progression, even while constructing its plant capability in Everett, by adding the new 777X wing plant. It is also closing the 787 surge line in Everett since 787 production has met optimal output within its normal production space for the 787. Boeing can do this using both Everett and Charleston. The former surge line will accommodate 777-300 production as the 777X production floor is establish in the same facility. Boeing is juggling its space, during its march on the world of airplane manufacturing.

The internal production strategy makes it possible. Reduce the backlog and match customer demand is the obvious observation. The over-arching production theme was addressed at the beginning of the 787 program back in 2005. Boeing then lacked an ability for addressing its order book back-log. Now they have completed its initial stage for reducing backlog, while taking more orders in at the same time. Even though it lags behind Airbus at this point for 2015 orders, multiple orders are hanging out ready conformation, during the second half of 2015. The customer controls the announcement. Case in point, is the recent Vietnam Airlines meetings this week in DC. There are multiple 787's in play, possibly 777X orders hanging on approval with Vietnam Government oversight. Boeing has just tendered an offer on various aircraft types. Such as the 787-8 and 787-10 totaling sixteen additional 787's for Vietnam Airlines.

Additionally, as mentioned, there are talks of the 777X with Vietnam Airlines, and its government.

This one example is also repeated throughout the world, as customers need to Identify its own financial resources and approvals first, before stepping up for ordering. This could take time not in years, but in months. There is a lot more to come in 2015 as the time element moves forward. However, this matches Boeing's productivity model. It is making room for new orders faster than Airbus can build against its own backlog. An extremely huge talking point for airline customers. Boeing is seizing the backlog moment and shrinking it into a customers relevant range of need for ordering and planning. While Airbus has expanded its own backlog without achieving any significant production capability whether or not orders swell.

Boeing has achieved customer positioning for timely delivery, where Airbus has outpaced its capability to deliver aircraft to its customers within the customers own window of opportunity. The productivity emphasis has been a long time coming with Boeing, as it has made production a main focus for the last ten years. Airbus has only just begun this production journey, during the last few years. It may be too late for Airbus, as the Boeing 787 is now reaching its customers consistent validation with airplane appeal and timely delivery. Boeing's availability of production slots are more in sync with customer's own five year plans, than a competing Airbus A-350 can currently manage. The A-350 is the real "Late" aircraft not the 787.