Monday, October 19, 2015

The 787 May Never Show Boeing The Money But...

Currently the 787 program has dug a "Never Mind" development hole of Billions of dollars. The accountants slide this pile of money aside from the current 787 costing and revenue spin cycle. The "hole” pile of money will never see the light of day until burning receipts on Boeing's 787 free of debt day.

Plan B has moved into plan A. All Boeing aircraft are on deck. USE 787 technology for new programs so Boeing can burn through its already accumulated R&D costs expended on the 787 program. The 777X and the 737 Max programs are borrowing from the 27 Billion of Boeing cash pit lost on the 787 program during the last ten years. Even the KC-46 has a 787 avionics arrangement in its pilot’s cabin. The 787 was not especially for the 787, it was for all of Boeing's family of aircraft.

The $27 Billion hole was for every flying example in the Boeing family and can only be recovered through a family counselling session.  All that money thrown in the pit is stand aside money for Boeing programs concurrently moving forward. If the KC-46 uses 787 avionics then let the accountants move some money out of the 787 money pit into the KC-46 program. If 100 more 787 are delivered then move some more money out of that same pit as a consistent rate under the flag of profitability of each 787. However, if all 787 deliveries are made, it won't eliminate the Boeing money pit. It needs other programs to prosper and spread that pit of debt proportionally amongst each program with due diligence, according to its own borrowings of technology from the 787 program. 

Perhaps the 777X uses laminar flow technology from the 787 program or it uses engine development and other core Technology breakthroughs, paid from the Boeing money pit. The accountants will attack the money pile with a vengeance and reduce the debt accordingly. The money backtrack can make the 787 profitable when the pile is gone. Every executive gets a complimentary backslap when the money pit is gone, not by the doings of a stand-alone 787 program, but the Boeing family of aircraft and military programs borrowing from the 787's $27 billion dollar pit of costs set asides. Accounting is an opportunity for annual meeting speeches.

In real terms the 787 program wasn't about the 787, but was about catching and passing Airbus from a strategic standpoint. It had to leap frog Airbus from top to bottom in development and position. Going from a commonality perspective to an engine application throughout its family of aircraft. Mission was accomplished and Boeing has retooled its marketing reflecting it has beat Airbus at its own game. The Money pit is not a 787 debt for which the 787 will never pay back and be called profitable. It's a companywide money pit for every aircraft going forward which will be profitable from the sum of its parts. Every Boeing program will take from a 787 spawned systems, ideas, or parts and write downs from the Boeing 27 Billion dollar 787 hole.

Boeing Vision statement has to have the 777X, Max, and KC-46 (747-8i) for making the 787 profitable.  After all it's the sum of all Boeing's parts.