My Blog List
Sunday, April 30, 2017
Thursday, April 27, 2017
It's Time To Complain Again About The F-35
Displacement is an old term with a new application. The
theory of a floating object weighing the same as a rock, suggests it should not
float. However, creating a space inside a rock will
displace a volume of water which weighs the same as the hollowed out rock thus making
it float. The critics look at the F-35 as a rock that can’t float nor does the
rock have enough power to make it fly using those conclusions as a core
criticism.
But in reality the F-35 program has both the necessary
displacement and power to make it swim in a sea of air and fly very fast. Many critics have not factored in how the F-35 program's little displacement
can float a program. Looking at a block of cement, conventional wisdom, would
demand it won’t float and could only fly a few feet from a brick layers hands.
Yet there are concrete boats that float.
The primary criticism speaks of plausible opinions where the
F-35 will lose in combat. The assumption infers that it’s a Bumble Bee and it shouldn’t fly at all, yet a Bumble bee can navigate between rain drops or the
sprinkler hose drops. An F-35 will just plain lose because its wings are too
small like the Bumble bee where fifth generation computers won’t make up the
difference.
Additionally, the worry here is that the F-35 is too far
down the road and there is no turning back. It can’t survive a fight. Just like
the concrete boat sinks or the Bumble bee dodges rain, it can’t do what its
developers say it can do. Traditional wisdom tells us concrete sinks, Bumble
Bees shouldn’t fly and the F-35 can’t fight. Who is right and who is wrong?
The answer comes from tests after tests and then war games
after war games. War after-all is real and how real is the F-35 fighting a war?
The critics weigh in at this point. Those are same ones that never have flown
an F-35. The pilots who fly them are either earning their pay by agreeing with
its bosses or out of pride. After all the DoD pays the salary. The pilots will
not reveal secrets when asked, but they will reveal how well the decision it
was to build this aircraft.
The industry wide consensus patronizes support of the
government position and the critics sell opinion as gamblers gamble for a
living. In fact, the opinionated tends to critique the government for its gambling
with the nation’s defense as a curious twist of reasoning.
Everything bad about
the F-35 supports the nay-sayers and everything remarkable about the F-35 is
embellished by the defense of this nation.
So what has Lockheed wrought? The best answer at this point
is looking at Red Flag exercises for which the F-35 finally participated. Even
if it were a fixed fight, the F-35 flew remarkably over the best 4th
generation American fighters with fantastic 15:1 kill ratio over adversary
aircraft in the event.
However, this was a test of capability without a final
version of its software installed. It will become more lethal with version 3F
installed even since that Red Flag war game version. It dodges rain drops at Mach
1.6 and the Bumble can’t fly that fast. It drops bombs faster than a concrete
boat launching, but on a dime.
The critics have not included how technology displacement is
floating this concept. The new school of thought is not in dog fighting. It is supersonic
techno fighting where it doesn’t have to go Mach 2.0. However, the F-35 pulls
9+ G’s. It takes the inside corner away from escaping dog fighters and shoots.
Much has been written about its already “old” stealth capability.
You can’t fight what you can’t see approach that the F-35 offers is years away
from being caught up with from its onlookers. Its super computer capability fuses
data into one giant computer rendering where any two-seater neck jockeys has to
retire from eye strain when trying to keep up. This isn’t a dog fight, its annihilation
time for any adversary.
If the US wanted to use X-15’s for dog fighters, it could have
done that 60 years ago. Having a drag racer for a fighter jet is not wise nor
is it practical. The F-35 is more of an extremely smart sports car. Put six of
them in the air and it becomes a swarm of Bumble bees attacking a hapless sun
bather. The only weakness is its weapons load capability. It may run out of
munitions before clearing the battle space. Even its paltry 25mm cannon has too
few rounds to sustain a spanking. It was put there in case some day it might
need to use it as a last resort. Remembering the early generation fighter
pilots carried a side-arm with six shots on the hip as some kind of courage
maker when shot down. The 25mm cannon will make a mark when needed.
The critics will sound smart and adversarial players will
copy the F-35 or its concept but what lies beneath its skin is where the fight
begins.
Saturday, April 22, 2017
Boeing’s Corporate Soul Is an Endangered Species
For so long has corporate after corporation strives for a
fat bottom line with a straight line drawn by consolidations, quality
reductions and a search for the cheapest part. The program engineer sometimes
become an endangered species as lay-offs become part of the corporate thirst
for just-in-time investor satisfaction. Somehow the main product becomes the
investor when abating risk is the Pablum for every investor.
Boeing has taken a wait and see position thus offering the
door to hundreds of high paid employees until more sales are generated. The
rationale is directed towards future market cycles slumping. As good stewards
of investor money it will cut forces. The corporate soul is owned by money and
everything else exist because of that money.
Back in the day the corporate mind set was building hugely
successful products and the investors will come. The inverse follows with
building hugely lean processes where the investor will profit.
Clear back to 2003, Boeing faced a crash by not having
hugely successful products. They weren’t family and people love families while its investors love margins, shares, and such things. The mind set coming from
investor thinking, “Go fire the fuel truck driver”, if it fattens the profit
margin. Boeing aircraft happen to run on fuel.
Boeing has laid off hundreds of its higher skilled engineers
because it will fatten the bottom line to do so. However, another perspective
is why Boeing hasn’t used these people in its vast organization for the making
of superior products which makes them indispensable. It suggests a Boeing waste
of personnel has occurred and they must “go” because investors demand a
reduction in force before stock prices can increase.
The simplistic rationale becomes traditional for its corporate-investor relationship. The micro-managing of expense items is the
tweak for inspiring investments during a down sales year. In fact by years end
when Boeing sales supersedes its competitor, Boeing stock will rise, while
those “dispensable” engineers are long gone.
If it can be done cheaper with fewer people is the corporate
engine of success. This happens too often in corporate world. The older concept
of building the best is a risky gamble when profits are wrung out of cheap
things becomes better motto to live by. No longer are things made for the pleasure of the
customer but for the pleasure of investor.
This is more of an Allan Mulally story than a blog idea.
Allan Mulally ran the Boeing commercial division until the Ford Motor Company
had swept him away. Why? Because his vision is what a failing car company
needed. Allan led the Boeing wide-body charge in the early 21st century
the he engineered ford to its success. He defied the corporate conventional
wisdom of cutting cost until becoming rich then leaving. An engineer had a
vision to build it best and everything else falls into place. He was no cost
cutting bean counter saving the corporate millions for the profitable investor.
He was a sound old school performer who wanted to make it great or don’t do it
at all.
In spite of its moon-shot problems encountered during the
787’s early program. The Mulally die had been cut. Boeing would take it to the
next product level that even its competitor would fear to tread. His
engineering sense made it so.
Since the arrival at Ford, Alan Mulally and even later his
retirement, Ford has achieved a remarkable automotive turn around. They make a
product people love. In fact being a big Chrysler fan, I have since lost
interest in its product, because Ford brings a new game to the table which
works well for me. The Chrysler-Fiat merger made me think more about Ford than
anything.
Now corporate stiffs run Boeing. Engineers are being
laid-off as may show less respect to the customer than for its investors is
revealed. Boeing is not using its human resource well then having to lay off
engineers. It tells me Boeing is run by a different breed of leadership which
adheres to its main job of packing golden parachutes.
The HP example of an emerging leader in the computer world
until they embarked onto the slippery slope of corporate self-service. It has
shrunk, reduced, and imploded itself for the sake of corporate self-enrichment
over customer satisfaction. Caught in the middle are its people who are slowly
disappearing due to lay-offs and retirement packages. Soon it will be another
American memory of how stockholders will reinvest into something else.
When a person refers to a corporate soul, it refers to what
purpose the corporation has for being. Is it for its customers or is it for its
leadership?
Wednesday, April 19, 2017
Where Does The 777-8X Fit
The 350 seat 777-8X has exciting potential
for many airlines needing fills for seasonal campaigns such as trans-traveling
the globe on any seasonal schedule. An Air New Zealand snippet in today's news
cycle has hit on a place for the 777-8X. The "Travel Talk" is quoted
as:
Air New Zealand...
"The airline currently operates a 302 seat Boeing
787-9 Dreamliner aircraft on the year round route with flights between 3-4
times weekly. From late September 2017 until early March 2018 the route will be
upgraded to a 312 seat Boeing 777-200ER for the majority of flights, with the
Boeing 787-9 Dreamliner continuing to supplement it."
There it
is, a place for the 777-8X. It seats about 350 and really goes the distance.
Air New Zealand could expand operations with 787-9's and then move a seasonal
route in by using the 777-8X. The interesting observation for any two tier
aircraft venture become an attractive concept using a variety of wide body
frames. The 787-9 is great for intercontinental travel and the 777-8X becomes
the pinch hitter chasing seasonal surges. The 777-8X is in the up to 8,000 mile
range. It can chase the seasons anywhere on the globe and fill the cabin with
350 holiday passengers. Air New Zealand must be looking at the 777-8X if it
uses the 777-200 currently for junkets.
However,
the Air New Zealand offering is not a one off situation while many other
airlines could expand using a combo of the 787-9, and then reposition with a
777-8X in an ever changing seasonal clientele. Once an airline can position the
ultra-long range behemoth for Canadian summers and then broad the expanse of
the Pacific winters, the route switching and utility of the 777-8X becomes a
preferred tool in the market place travel kits.
Air New
Zealand unconsciously placed the 777-200 into its rotation so it also means
other Airlines have similar strategies in play. The 777-200 is a useful tool
and the 777-8X is a dashing experience cross broad expanses chasing the
seasons.
The F-35 Will Soon Move To Full Rate Production
The official acronym is not yet revealed for
pushing out 100 F-35's a year from Lockheed's Big Texas doors. Winging It, after
exhaustive research has come up with FRP replacing the LRIP status over the
next year. Low Rate Initial Production or LRIP has been the constant reference
since 2007 as the chart below reveals.
F-35
History Chart:
As of March 31, 2017
Lockheed Martin has delivered 231 of the F-35's V generation. Looking at the
chart above are the Salmon colored lines worth noting. The first line marks
about 210 F-35's delivered by mid-January 2017, completing the contracts for
LRIP 1-8. Lot 12 denotes FRP moniker.
However, 2017 will start
burning through the LRIP-9 contract “back lot” during 2017, resulting in a breaching
of its LRIP-10 lot in the first half of 2018. There are two terms in play
in the above chart. One is the noted LRIP contract unit number and the other is
the actual production number delivered. The far right column is just a pacing
number not based on actual deliveries but a straight slope for LRIP contract
delivery pacing. When the LRIP-10 contract units enter the factory floor,
Lockheed will rapidly approach FRP as the chart indicates a predictive FRP
status for contract lot 12. An arbitrary pace increase is exampled by a 100
unit jump when LRIP-9 units are being built. Currently as mentioned the
Lockheed/F-35 has finally exhausted the LRIP-8 contract backlog and now has
about 25 % of the LRIP-9 contract units completed when it reached 231 units delivered
at the end of March 2017.
A convoluted view of having two quantitative attributes in play with contract numbers and its actual
production numbers examined, but understanding both numbers helps for future
reading when a report says 231 F-35's have been delivered an observer can see
what contract is the 231st unit has come from and how many F-35's are
expected in a current year. As of the end of March, 2017, it could be expected
about seventy more F-35's will be delivered in 2017.
Monday, April 17, 2017
Forecasting Boeing 2017, Huh
Boeing will drop hundreds of engineers soon
as its sales team reports a down year. Anyways that's my take on the Boeing memo
to "bubble" employees otherwise known as last hired first fired or
turning 55 is so hard to do Boeing work groups.
Memo
Quote:
"We are moving forward with a second phase of
involuntary layoffs for some select skills in Washington State and other
enterprise locations," the memo said. "We anticipate this will impact
hundreds of engineering employees. Additional reductions in engineering later
this year will be driven by our business environment and the amount of
voluntary attrition."
Okay so 2017 sucks to be in Boeing's Workers Anonymous Union (WAU) or fondly referred to as "wow" with those who jockey at a CAD.
Boeing's VCMCO Explaining To The Shop Steward What's Up With That
see seven or eight or seven paragraphs below for what is a VCMCO??
The
WAU disciples are facing what sales call a down year and somebody has to pay
while stockholders can invest into more Boeing stock when incentivized by the WAU
layoffs.
Boeing is "moving forward", so speaks the memo to
the minions. Every "cube" matters group is hosting last day office
parties months ahead of the ax falling on hundreds of engineers who have
little justification for being there in front of its CAD screens. Drawing
lines from the engine to the stern of anything with wings is not needed since sales are forecasted sluggish. "Analyze
this" is the battle cry coming from corporate top floors sitting above the
engineers. Sales are sluggish in 2017 and Boeing will retrain engineers for
finding gainful restaurant work from the North West to the South East, for those who "want fries with that".
The forecast signal from Boeing memos are more important than
just a few hundred engineers. Production is full steam ahead and no production
workers should worry during the remainder 2017.
The pending layoff is an efficiency and expense line item
move for the stockholders. Boeing will hire more engineers next year. After-all, the 737 Max and 787-10 are now flying. The 777X program is too far north to
worry about engineering program lay-offs at this time. The problem is Boeing has no up and
coming new airplane project requiring more engineers. There are 10's of thousands of
Boeing engineers remaining at work while even if 1,000 engineers are canned, it becomes a
mere brow sweep of the back hand.
The wow union rep stands aghast at Boeing's signal to
the masses as if Donald Trump were running things. After-all the union is
trying so hard to cure workers from work related habitations with its twelve step program and they are
only on step 3. Workers Anonymous Union will strike if forced into a lay-off. The
chief argument is how can Boeing engineers not work at work during a lay off?
A loud upper floor back slap is heard down stairs after the
memo was distributed and reported in the news cycle. Going 4-5 years to
engineering school is no guarantee of continuous employment after 55.
Those who go to their first class reunion could be dismissed. Going
to class reunions is a rite of passage just as the pink slip is a badge of
honor for those students who still have loans outstanding.
WAU union demands a meeting with Boeing Engineering
executives. The question is posed to upper management, "why can't we not
work?” in perfect cube grammar?
The executive answers with an affirmative huh?
"If engineers can finding something to do to support the sales campaign in 2017, they can keep their jobs", says the Vice Chief Minion of CAD Operations (VCMCO).
"However, we have this memo voted upon from the board and the copy machine
has issued it to everyone. It will take until 2018 before the board runs out of
copy machine toner and thus reversing this memo, in question."
The wow guy pipes in with strong tones, "The reduction
in force engineers will remove the copy machines and its toner before the first
of June if lay-offs occur."
The VCMCO provides
Boeing leadership jargon to the WAU shop steward,...
"It is "our" opinion that the fact finding
committee after exhaustive research has come to an imperative conclusion, it is
its opinion which demands a reduction in force. The research also
concludes those who have an anonymous union work card are not needed until
further notice for which the copy machine will advise the WAU of any changes,
is that clear?" The shop steward succinctly says, "wow"!
The VCMCO then retorts, "Further-more, the board has
advised a determination for all engineers that sales numbers are low and will
advise at which time if a sale is made with any of the the single aisle, duo aisle or
military segments for which a reconsideration becomes eminent for any
announcement concerning the work force!"
The shop steward replies, "Huh".
Then we are in agreement with our huh's, say the VCMCO?
Friday, April 14, 2017
The Over-The-Rainbow Boeing Leap
Boeing long ago knew it needed to do several things:
- Leapfrog Airbus Technology and Product
- Build like crazy All Things Boeing
The two punch approach was designed to bring Boeing out of
its relegated slump Airbus had put it in. A long time had passed since Airbus
first produced its “joy stick” manipulated fly by wire aircraft. Boeing had
long been entrenched with its custom of building individual types without having
family ties.
The 737, 747, and 757 where all adopted orphans until someone somewhere
in the halls of corporate made a presentation in earnest. The two fold plan
unfolded on the projection screen wall.
Presentation notes goes as follows from imaginary briefings
of Boeing board meetings 2003.
Boeing is chasing Airbus and not
leading the industry. Airbus had a good idea that worked well. The A-300 with
its quirky “Joy stick” for left handed pilots” and many other new aged
innovations. Boeing is still making wires, pulleys and hydraulic assisted actuators
to fly its dysfunctional family of aircraft. We could lose a lot of weight in a fly-by-wire
scheme with electric motors and systems controlled by computers jumping over Airbus
before it knew what hit it.
So the story goes forward in this fable. The board chimed in
unison, “that’s not the way we always do it!”
“I’m not done”, went the presenter. Please serve the cocktails you will all need it before I’m
done”.
“Who is that guy?” the CEO chimed in with many more abrupt huhrumphs
coming around the table.
Now the presenter had the board’s attention. Okay, how many
of you have a family (errr families in some cases)? Hands went up as if in
fifth grade art class.
This can only work if you catch the vision and then the mission takes place. This is a vision pitch for Boeing and don’t look at that Airbus brochure because we are going in a new direction!
We don’t have a family, we have a club where all its members
come from different places. The vision is to build a family of aircraft where
each member can work with its siblings and parents when mowing the lawn.
However, there is an undermining caveat caused by Airbus, Boeing must build it more advanced than
Airbus can afford to do once the cat is out of the bag. Airbus just came up
with “we can build it bigger than Boeing can” program, and poof it’s an A380 as
the world marveled. Three hundred and seventeen ordered frames later somebody
got fired at Airbus. Even if they were a family member.
1. Back to the laser pointer, look at the vision once again.
Every member of the Boeing family can operate every member of the Boeing
family. That is to say a 737 pilot after two weeks in a flight simulator,
viola, Boeing has a new 777 pilot or at least a 1st officer.
2. Take your eyes off the Airbus brochure because we are
talking Boeing today! Make an airplane beyond what Airbus can respond. This one
is a big mouth-full of investors needed involved with this big idea and it
starts with the leadership. This is critical to the “over the rainbow” strategy.
If we build an all new type of airplane, Airbus will surely follow five years
late after we take five years later than expected during development. The trap
is set and Airbus will step into a half measure response using “bigger” as its
main attribute. We think (Intel thinks) extra wide body works well for Airbus
ego after the A380 false flag. After that Boeing takes over the aviation market.
3. Boeing does yokes the best and Airbus plays games with
its Joy Stick. Even though a yoke is ancient history B-17 stuff with cables,
pulleys and hydraulics. The yoke becomes a computer center for its avionics
suite. Even though it is not needed since a pilot could use a helmet to fly an
aircraft. The yoke symbolizes how far Boeing can fly. A joy stick is under
stated and a yoke between a pilot’s legs says it all. It’s Boeing. We are
asking all our pilots to give up video games and fly airplanes. That is why we
won’t be issuing berets to our pilots because “joy sticks” are so Euro. Questions?
I thought not!
4. “Ahora nunca”, or the time is now or never as our
brothers south have coined. Let’s build copious numbers of 787’s in a family of
aircraft spanning the 737-797 range of aircraft. Let Airbus go wide and go long
and we will intercept its sunk costs with a plethora of airplane types. Are we
spending money? YES!!!. Are we making money, we hope? But what are we doing?
We are stealing the market back to Boeing where money is to
be made. Airbus has bigger problems going forward in future time than Boeing will
have. The Boeing technology leap can’t be copied by Airbus as they are
unwilling to go all-in. Boeing is going all-in! Boeing is committed to its
family of aircraft and it someday will have first flights on three new models within
a year’s time. Someday a key Airbus customer will rethink its mega order
committed in a sweeping reversal of fortune. Someday Boeing will sell over
1,200 787’s and during a down year and then will add a consistent number of this
aircraft to its order book during the same year.
5. This pitch is to build the center piece aircraft going farther
than Airbus will go while they lay-up its sales pitch with NEO proposals on older frames. Build
all Boeing types around the center piece while all members at the table can
feed from its innovations. Finally, win back Airbus customers as they realize
Boeing value over Airbus value. Someday being a Boeing family member is the
best situation coming from a prediction that a major customer from the mid-east may cancel Airbus orders
and invest into Boeing orders because better is always best.
The "Over-The Rainbow" strategy is simplified by going father than Airbus is able or willing to go. It forces them to compete on the cheap with half measured innovations and its size matters theme of five more inches which in some circle is inadequate to do the job which leads to extra wide bodies. Who pays for all this stuff. In the end Airbus will pay dearly to compete.
Wednesday, April 12, 2017
What A Delta-Airbus Order Cancellation Means
Delta Airlines back in the year (2014) gave way to Airbus’
charms and ordered up $14 billion worth of wide bodied aircraft. It ordered 25
of A-350-900’s in a disastrous November month for Boeing during 2014. It turns
out the order maybe just Airbus eye candy as Delta ponders future growth and
types for its fleet. The same Ground Hog Day prognosticators have beckon forth
a prediction for wide bodied sales taking a dip back into its hole.
Boeing not being discourage over the ground hog’s tunnel
scat kept churning out the 787 as fast as they could. Many-many customers have
787’s and are making money using the aircraft. The A-350-900 have delivered 77
units and Delta appears to blink over the whole ordeal.
Now for some ground hog updates from "Winging It" in some kind
logical blather. What has changed and what will come is the core of all future
blather. Delta is finally exhaling on its wide body order status. There are
several conditions which may turn Delta into a new heading.
Modify the Airbus order with:
- Cancellations,
- Deferrals,
- Or a tip towards the 787-10.
A combination for all three exist for Delta as Airbus squirms
at all three options listed above. Cancellations bode badly for both Airbus and
Boeing as it will be unlikely Boeing will spin some sales under that situation
with Airbus trouble.
Deferrals is a manipulative move by Delta waiting for fuel
price increases before ordering more Wide Body such as the A-350
product. The Delta decision making dilemma is an internal matter where Airbus
could be thrown under the “bus” in various combinations of a purchase order
changing. The bus stop does not help Boeing at all as it will apply only to whatever
wide body product Delta is tampering with during this decision period. The best
Boeing can hope for is complete cancellation and another go at Delta in 2020.
The market experience will influence Delta more than any sales pitch from either Boeing or Airbus at that
time. Once again by 2020, the 787-10 will be in service strutting its stuff and
Boeing has a reload shot at Delta who may also have a hidden agenda by seeking
something other than the A350-900.
The A-350-900 may fly beyond Delta’s market structure.
Rather than have a 306 seat aircraft flying 8,000 miles it could use better a
330 seat aircraft within its market footprint. Otherwise the A-350-900 maybe
too much aircraft for a Delta market place.
The more efficient 787-10 maybe
just right for Delta planning when filling seats under 6,000 mile range above
80% capacity goal. It will be hard to find customers going in the 7,000 mile
range for every 306 seat flight. The A-350-900 is wasted space flying that far.
It pushes too much weight when having an empty seat syndrome for its bottom line. Delta
is a prime candidate for drawing a 6,000 mile circle from corporate headquarters
from Atlanta, Georgia. This would include South America, The Pacific Rim and
Europe. Not a bad market to fill from Atlanta.
Having said the above argument, it is easy to see the 787-10
as a replacement aircraft for Delta’s market schemes. During 2014 when Delta
sought Airbus for its a-350-900 the 787-10 was just talk and the year 2018 was too far out
for any real commitment with Boeing. Now the market is imploding on wide body
orders and Boeing looked at its prognosticating models and concluded the 787-10
would be the right aircraft at the right time. Boeing had such a big backlog
and it could keep churning out 787-8’s and -9’s for five years without
hesitation.
The market is cyclic and the wide body division is the most
vulnerable, but Boeing was rapidly filling long range routes with its 787-8 and
-9’s. Airbus hasn’t yet reached its production output for its A350-900 and the A380
is all but game–over status. Boeing scores high on gamesmanship and Airbus
scores high on too much too late with its blundering airframes. The A-380 won’t
make Airbus money no matter how it cooks its books. At least Boeing dumped its
losses into a deferred 787 cost pit. A deferred costs opine gives every blogger a
chance to write about Boeing without thinking too hard, my self-included.
Delta is huddled in meetings with its lawyer’s, board
members and key stock holders at this time. The decision is what to do with its
25 A350-900’s on order. The wide body market is evaporating during 2017, right within Delta’s wide-body delivery schedule. The First one arrives at Delta this
late summer and will carry its first route passenger in the fall of 2017. It
will fly the Pacific Rim.
The summary conclusion is for Delta to stick with its Airbus
order with a half dozen deferrals. It may look at Boeing product for its fleet
replacement model while not using all its A-350-900’s in a one for one replacement scheme, but it will introduce models that fit exactly Delta’s capacity and range
requirements. This infers that its fleet expansion is on hold until the wide
body reignites sometime after 2018.
Monday, April 10, 2017
2017 1st Hundred Days Of Airplane Making Performance
It has been a 100 days since the New Year’s Day start, 2017,
and the aviation world proclaimed a dim buying outlook going forward. Boeing
has become a respectable selling engine while Airbus meets expectation. During
any evaluation period, a “meets” rating says it too early to panic and an
“exceeds” expectation makes an eagerly looked for outcome.
Raw numbers are the performance indices which guides the
evaluation while not looking at rumors or off handed prognostications going
forward. It is a performance snapshot with only one main purpose. It tells how
the subject has performed and not its potential. Both Boeing and Airbus have
different results. Boeing exceeds expectation with its orders and Airbus meets
expectation using a pretext of a down order year.
Production is the second category under evaluation where
both makers should maintain a steady of improving condition. The category is
the internal cog which drives the cash portion on an organization and leads to
an improved investor participation. Boeing maintains its productivity activity
in a "meets expectation" condition where Airbus has mixed results
through its airplane types. As an evaluation claim can be made the Airbus wide
body division does not meet expectation where the single aisle division has a
tenuous meets expectation status.
The fumbling of the Single Aisle NEO introduction has cast a
shadow over the production stream of its narrow body division. Even though
Airbus continues to churn out single aisle as expected it has stumbled in the
NEO arena, which is not uncommon for a new type progression. Its gear driven PW
jet engine is under a separate evaluation and has called in a stall for those
types of engines. However, looking at the wide body segment it is important to
note, Airbus has delivered about 77 of its A-350-900's during its first 28
months where Boeing delivered 114 of its 787-800 during the same number of its
first months.
It is important to note, Boeing shut down deliveries for
three months during its battery debacle. Boeing had far more start-up problems
and had a far more complex aircraft than Airbus could produce, yet it far
exceeded the 77 units from Airbus delivery during the similar 28 month period.
Airbus then receives a "Does Not Meet Expectations" for its wide body
division since the A-350 fundamentally is not up to speed. If it is to meet
expectation it must deliver ten A-350-900's a month for the duration of 2017.
It has only delivered 13 A-350-900 during 2017 for a 4.333 rate per month
falling well below the Boeing rate at the time in its program. Boeing Produced
about ten 787 a month 28 months into its initial production cycle. Currently
Boeing meets/exceeds expectation during its production evaluation and Airbus
does not meet its own expectations at all.
The recommendations for either maker goes as follows; Boeing
is exceeding expectations during a predicted slow sales year with its robust
order book of 198 net orders year to date. Where Airbus has received 37 net
orders which falls well below a 600 unit order year pace. However, with nine
months to go Airbus can easily catch-up or exceed sales expectation but it
finds itself dependent on air showmanship from balloon order announcements. It
is recommended Boeing will gain an order advancement over Airbus during 2017.
The second part of this evaluation goes to production and
Boeing has a clear lead over Airbus even as it feathers its wide body division
back a little while matching a shrinking backlog and infuses new models into
its production. The game changer for Boeing is if the 737 Max somehow stumbles
on the production line or its entry into service. Both stumbles are unlikely
this late into Max program. Airbus still wrestles with parts issues and PW
engine issue and won't unleash its production potential until those problems
are resolved. Airbus will solve those problems but Boeing will have passed it
in a drafting maneuver as if racing at Talladega race way.
Thursday, April 6, 2017
World's Largest Airplane Builder Competition 2017-3 (Updated)
Here begins the
unofficial Monthly whose biggest airplane maker for 2017 summary? There are
much more details involved than the biggest maker. The backlog is a critical to
future production run and Boeing has the early 2017 lead for building its
backlog sustaining production and infusing cash. It all starts with the single
aisle category where Boeing has made important inroads during the month of
March. With 134 net single aisles in March and a total YTD 157 net aircraft for
this type pales the Airbus book of only 9 net single aisle orders YTD and
having a thin 23 gross single aisle ordered as referencing with Figures 1 and
2.
Fig. 1
Fig. 2
The delivery arena is here world's largest is tallied and
Boeing has the early lead it won't relinquish over-all in units and $$ by
year's end. Boeing had a substantial March with 47 deliveries for all single
aisle types and its YTD stands at 113 737's of all types. However, Airbus has
upped its pace of reporting single aisle units with 47 March single aisles and
107 over-all delivered for 2017.
Fig.3
Fig.4
Big money is found in the wide body arena and orders are
important for future production and cash. Boeing has had a tepid 2017 beginning
as predicted with 31 net WB orders where the big ticket item from the 747 has 5
cancellations bringing the net YTD orders to 31 WB aircraft.
However, Airbus is in no great shape either, as it only has a net -3 WB's as
shown in Fig. 6. Much more mystery lies ahead in this category as it will make
the difference five years out where Boeing can sustain its WB delivery pace
easily until 2020 and after.
Fig. 5
Fig. 6
Big bodied production is Boeing's strength at
this time. Between the 787 and 777 it rakes its cash basis each month. It is a
worrisome segment going forward, but for the time being, it is very stable as a
delivery engine. The number of wide bodied Boeing delivered is not quite double
of Airbus' 29 WB units. A 56-29 battle year to date gives Boeing the edge which
it will never relinquish for the whole of 2017.
Fig. 7
Fig. 8
The historical picture is showing a down period for Airbus as its over-all backlog in units and value shrinks faster than Boeing's. It is because of Airbus production as its wide body division is not yet up to speed after three years. Airbus has about two more years before production with both of its single aisle and wide bodies will reach a maximum output at which time Boeing must build more single aisle orders in order to stem the Airbus upcoming order and production surge. It is obvious during 2017, Boeing will maintain a level backlog where Airbus' backlog continues to shrink. In 2018 it will be a closer battle for whose is the largest where Boeing should edge out Airbus once again.
Fig. 9
Tuesday, April 4, 2017
Boeing Sides with Emirates At Dubai
Boeing sides with
Emirates at Dubai Airshow November 12-16 2017. If ever there was an awkward
moment on the world stage it is set for Boeing and Emirates at Dubai’s main
entrance. Study the pavilion map and there it is Boeing and Emirates side by
side at the front door. There is anticipation in the error after looking for
Airbus or EADS on the Floor Map and not finding Airbus(look on map for stall 552 Airbus Group).
Boeing greets’ at the Dubai pavilion’s front door for those who enter the hall.
Look for EADS or Airbus who have big deals pending somewhere at the airshow.
Most likely they will make a presences at the exhibitor’s tarmac with its static
displays and what not.
2013 Dubai
Airshow Reports:
1.
Emirates - $76 billion
The
Dubai-based airline owned by the local government made history at the Dubai Air
Show in November with the biggest single order ever for Boeing: 115 firm
orders for the 777X-9X and 35 for 777-8Xs. Those two newest versions of the
successful 777 twinjet haven't flown yet; they will enter service around 2020.
That was then in 2013 and now
is November 2017. What’s on the table is another Emirates mega order for either
Boeing or Airbus. It’s no accident Boeing is across the aisle from Emirates at
the pavilion’s front door. Something again is going to happen at the show and
the two big Dubai players are a hand shake away from each other as if no
accident occurred but a plan comes together.
The year 2013 debut an immense
777X coup of 115 777-X9’s and 35 Boeing 777-8X slamming the door on Airbus aspirations
for having a show stopping announcement with mid-east fleets. Boeing won the
show. The talk today is centered on the 787 family and the A-350 family of
aircraft. Having Emirates a stable mate on the exhibition hall is no accident
for Boeing. It bought the most expensive real estate in the pavilion next to
Emirates.
Boeing at the table head with Emirates, and EDIC an Emirate partner with Mubadala an Emirates bank who are all greeting the crowds by no accident. Something big is going to happen and it won't embarrass those at the head of the table at the main pavilion.
It will be a gross embarrassment
for either if an announcement for an Airbus order permeates the pavilion air
for the A-350 which Emirates is closely studying. Boeing has been told to wait
until a decision is made later in the year for which happens to fall near the
Dubai show date on November 12-16, 2017. It is not said an announcement will be
forthcoming at Dubai for either maker’s bid with Emirates but it stands to reason
Emirates will not snub its neighbor, Boeing, at the party across the pathway
from Boeing’s own pavilion spot.
Font Door is About 100 feet away from Boeing
Emirates walks by Boeing every time going to the Great Show Hall. It has three chalets in a row like Boeing as depicted by three orange bars above.
Further away beyond Emirates is chalet P-10, the Airbus gigantic chalet which is double of what either Boeing has outdoors in the chalet swamp. This would make up for Airbus stationed at the back left center of the hall with its long display.
The front door position is like setting at the head of the banquet table at a state diner. Airbus is closer to the kid's table than the head of the table as both Boeing and Emirates find themselves.
Boeing is well positioned to
hear great news at Dubai and Airbus is positioned at the end of the chalet flight
line in position P-10. Emirates is about mid span between Airbus and Boeing’s chalet
position. Boeing has three standard chalets and Airbus has the biggest Chalet
on the flight line out of everyone but does not have a cherished spot in the great
pavilion hall as Boeing does.
What does this all mean?
Emirates keep its friends close as the saying starts to quote. A spot at the
table is also important. Airbus is there to impress and Boeing is well positioned to lobby. There is a wait until the Dubai Airshow for finding out who played it best.
Saturday, April 1, 2017
Airline Supply And Demand (101) Is Off The Tracks
A Train pulls up at the station and the passengers walk on board.
Without little attention the passenger is seated and gets comfortable as
possible, Snoring passengers and crying children take little notice for the new
passenger. Only the passenger then squirms about a little and thinks about the
Train fare and wishing for a private compartment. It doesn’t matter what train
maker or car builder represents the system this is the only way from here to there.
The $99 fare for the next ten hours is more of an adventure
than a vacation. The Train is an immovable market object because it is what it
is, an immovable market object going down the track whether or not it competes.
Airplanes are not much different than the train example. The
passenger becomes a fixed object and the airplane becomes the variable item on
a quest to make money. If it takes narrower seats or less pitch to make money
so be it, the fixed passenger won’t change the dynamic unless something else
happens where money can be made. That is the essence of free market evolution in the 21st century.
The airline industry is entering a period of more space for
its passengers with less room used on the aircraft. Eventually the scientist are projecting a standing passenger rather than a seated passenger giving the traveler
more room. Putting on a $400,000 helmet gives the passenger the universe through its
thoughts and eye motions. The body is packed snugly in rows upon row of other
bodies hooked up to that helmet.
Economy Plus Cabin Sans Helmet
In fact the airlines will advertise the best helmets showing
tropical flora and fauna while sending scents of pineapple to a passengers
sensory organs. It may also induce sleep for an extra charge, even if landing in Alaska on a Pineapple express.
Additionally, the
premium economy position supports the passenger with nine vertical positions.
The business class has a hard sided container making it more than just an economy body
bag. First class brags of lie flat vertical incline of 45 degrees. They even get a
wake-up call before landing. Restrooms or sanitary stations summons a flight
attendant coming from a “seat” passenger's helmet by looking at the Icon for such
service longer than five seconds. Then the flight attendant will move you and your
flight bag out to the center aisle as if you are a hanging side of beef on a
meat hook.
Passengers wonder where the word "seat" comes from since the
tradition of posing like the letter K was mentioned in ancient history has long
been an abandoned custom of travelers.
Why is this so and what happened to the traveler?
"The airlines drove the airplane maker to this and it comes from corporate profit margins just for its owners, the stock holders,” exclaims the Steward of Airline services standing at the boarding counter.
"The airlines drove the airplane maker to this and it comes from corporate profit margins just for its owners, the stock holders,” exclaims the Steward of Airline services standing at the boarding counter.
“It’s all for the passenger’s pleasure and safety after-all”,
trumpets the sign over the exit.
Upon hearing this, I googled "flight bag" and it gave the answer
in clear terms, “The passenger space found on an airline wrapped in a bag, box
or placed on a slanted board”.
Sounds reasonable as I studied further on the laws of supply
and demand. Demand drives the market and supply drives demand. Not being
confused I went back to the train station analogy and saw the wisdom of trains
are trains in spite of a $99 fare.
The rails are so wide and the engine so big.
Crossings are crossings and passengers demand its square foot of room as stated
in the Constitution of Travel. This is also known as COT as a place guaranteed even on safari.
Therefore, the laws of supply and demand starts with the airline
demands in order to make money and its ability to convince customers they are
getting a good deal from flying 17 hours straight through using a flight bag containing a 400K entertainment helmet. Don’t forget the 9 position vertical sling found in
economy. The customer asks about economy plus and the flight steward replies, “Don’t
get me started go back to your flight bag”.
Market forces are in play where the profit demands an ample
supply of revenue centers. This all explained in the college level economics
class. The passenger is just a place holder after-all. The course work refers
to place holders in Economical-Accounting 404 during the senior year of school.
Passengers are more of an unavoidable factor when an airline seeks its profits.
It demands an ample supply of profits in spite of its customer’s desire for a
relaxing trip at an affordable “seat” in premium economy.
Even though a
passenger can’t afford a business class box it expects relief in economy. After-all,
after thirty seconds staring at the boy/girl icon in the corner of the 400K helmet
visor a customer expects a flight attendant to release them out of the flight
bag to do some of its business next to business class.
All of this is because of train travel, so don’t blame the
airlines, blame the steam engine.
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