Reposting Comment From The Guardian "The Case Of The A380"

Rarely does one come a cross a post that makes a salient point worthy of reposting. But I came across this comment on the Guardian today and felt it would be worthy of reposting about the case


Repost: by: Pat Logan  (Without his permission and worth the read, please say yes to reposting , and thank you.) 

Gaurdian Link

"I see most have rightly picked up on the lack of comparability of the two aircraft - I'd even go further and say that the A350-787 comparisons are wrong, as for most A350 variants the competition will be the B777X.

One other oddment to throw into the pot, though.

Which of the two firms got it right when deciding whether to invest in developing an "very large" aircraft?

Go back to the mid-late 1990s, and Airbus and Boeing reached opposite decisions about whether it was worth putting several billions into developing a 747 successor. Boeing opted for a relatively cheap rewinging and upgrade to produce the 747-8 and Airbus went for the 380. Boeing reckoned on a market of around 700 aircraft by 2030, Airbus reckoned 1700+. By 2006, market estimates by independent experts were in the 400-800 range.

Developing the A380 cost about €11Bn. It's at 259 orders, some 8 1/2 years after it's first flight. It's never yet hit the production rates that were forecast when the programme was launched, and by next year, it looks like Airbus will be having to build "white-tail" aircraft - i.e. built in advance of orders.

The original breakeven point (i.e. recovering development and production costs) was supposed to be 270 aircraft, but as development was delayed and the dollar:euro exchange rate fell, that rose and when anyone last made an announcement it was north of 400 units - that was in 2006.

Things have got worse since then. Sales and production have both been slower, there have been fixes needed to things like wing cracks, and production costs have risen. It's also probable that there's been much heavier discounting of aircraft than originally anticipated, as Airbus needs to fill production slots. there have been claims of discounts as high as 40% against list price.

Airbus is now only saying that the aircraft will break even on a unit basis (i.e the sales price will be higher than the production cost) in about 2015 (based on comments in 2010). Every aircraft delivered until then will have made a loss for Airbus. Note that it's only AFTER unit breakeven that any contribution is made to recover development and finance costs.

There have been 61 net orders over the last five years - a rate of 12/year. The delivery rate is about 20-25/year (and was originally supposed to be 30+)

They've been utterly quiet on when programme breakeven will happen for several years now. On a reasonable commercial guess, allowing for Airbus carrying the €11bn development cost on the books, plus delivering over 100 aircraft at a loss, plus the fact that Emirates has them by the balls and will be driving a VERY hard bargain for the aircraft they're taking, that breakeven point will have now to be well above the 400 forecast in 2006 - doing some crude numbers, and assuming the white-tails at best break even, I suspect north of 600 units.

Airbus probably needs to sell about 300 - 350 more aircraft to recover the original development costs, EVEN ASSUMING no losses on white tails, further development cost, etc. At that rate, it'd take another 25-30 years to hit breakeven. Bringing that forward either requires a sudden jump in demand or huge cuts in production cuts.

Oh, and of the aircraft currently on order, 30 are for an airline in receivership - "Kingfisher" of India.

Sooner or later, Airbus is going to have to take a huge write-down on the development cost of the A380. Which is going to mean that the French, German, UK and other governments will lose all of their launch-aid loans.

It's a hellish impressive pain - but it's looking like a commercial disaster." End Quote

Exactly my friend!

Aspire Aviation's Big Story

Aspire Aviation Big Story

Starting 2014 out with the big 777X is very an appropriate story. What I've done is to paraphrase this article with Liftndrag commentary. Please feel free to set up a second browsing tag with Aspire link above or just go there now to get its real scoop on the 777X program and projected performance targets for the 777X. Aspire has compared several notable class airplanes that 777X will do battle with during its progressions forward into the market place.

It is important to note that Boeing continues to have several rabbits in its engineering hat that will appear along the way. I would like this blog to spot those "rabbits" as they appear along the developmental road. Aspire only reports what is known at this point in time. Customers of the 777X may have additional and  achievable bench marks on the 777X given by Boeing, that readers, pundits lack for its own opinion. I fall into the class of not having a precise opinion at this time, but have gathered clues why Boeing is doing the 777X in this manner.

This Manner is:

• Composite wings and flight surfaces
• Aluminum body not composite
• Bleed By Pass power for subsystems not the 787's central core all electric technology
• Heavier than the competition
• Bigger drag coefficient because of bigger diameter engines
• Greater lift surfaces with intuitive performance
• Greater passenger capability of 400+ seats
• Widest dual engine aircraft available. Its more than the  XWB!
• It will fly better father with more people, even at a greater weight.

Aspire Aviation Chart

Aspire Observation:

"Together with the 9,300nm ultra long-haul 777-8X that is capable of hauling 17 more tonnes of cargo when deployed on the same mission as the 344-seat A350-1000 while having a 5% lower block fuel burn per seat, or flying sectors that its competitor cannot, it would be safe to assume Boeing believes the 777X will be the ultra long-haul leader in the future.

Unsurprisingly, Airbus contests these figures and points out it estimates the 777-9X will be up to 35 tonnes heavier than the A350-1000 in terms of operating weight empty (OWE) as the A350-1000 is a clean-sheet design and utilises a carbon fibre reinforced polymer (CFRP) fuselage, whereas the 777-9X is a “5th derivative” bearing an aluminium fuselage. This will make the 777-9X more than 15% less fuel efficient per seat and the -8X more than 5% less fuel efficient per seat versus the A350-1000."

Let the war of promotional rhetoric begin between these two giants. If Boeing could not demonstrate to the Gulf of Arabia States what they had up its sleeves from engineering departments across the company, then they wouldn't have ordered 259 777X, after which Boeing rapidly picked up Cathy Pacific. A quick move counter to Airbus aspirations in its order book. They didn't receive any order of that nature during Boeing's 777X launch. Airbus painfully watches the Boeing order grow on a paper airplane while the A350 reality languishes. A boatload of 777X paper airplanes is a definitive slap on Airbus' nose.  My best guess on this example is that Boeing made its case in greater clarity than normal. They showed these initial launch customers where they are keeping those cute little rabbits with a promise on how the trick is done with its heavier airplanes.  Conventional wisdom says that Airbus uses an old school slide rule where it has computed Boeing over-weight into an inefficiency when comparing its A350-10 with the Boeing 777X. Boeing wings and body building divisions have a new bag since Christmas. They build world leading wings and have done body/airflow design changes, bringing out the best with its laminar air flows knowledge over its body. The body design adjust flows at key points that maximizes its slice through the air. Thus nullifying those suspended additional tons, as a penalty that Airbus' slide rule predicts. Boeing has been doing this research for awhile and has hinted that its conclusion will go forward with an active flight service and optimized composite wing that will retire the old school curriculum with a wrecking ball applications to Airbus school walls.

Its always in the details that gets competitors like Airbus. Slippery aircraft slide through the air significantly better than Big Box behemoths like the A380 or an A350.

I took specialize driver training as a requirement for my state employment. I drove ambulances, school buses and dump trucks through chicanes, skid pads and other devious situations to test my newly acquired advance driving skills. In a school bus it is a cumbersome behemoth on a narrow course. It wasn't  a fuel efficient slippery thing of beauty, Neither is an A350. I hit the skip pad with water jets and the instructor activated emergency brakes. A 360 turn had just begun, and I had to control it. Had I had a sports bus weighing the same as a standard school bus  I would have saved fuel and would have controlled its performance no matter the conditions. Enough digressing already! Boeing has demonstrated and not reported its summary to its customers who bought the 777X. They listened to Airbus and didn't buy period!

Therefore, no matter what Airbus says at this time from its own conventional wisdom, which doesn't take into account what Boeing attempts to do for the 777X. Final weight (tonage) are pending as the 777X matures. Boeing promised a plan as they promised with the 787. Airbus said, "impossible, improbable and its not going to happen with the 787". The 787 happened and yet we now have the A350 (improbable plastic), about to get kicked by a little of the old school, and then some new school in the 777X. Airbus, once has to say again impossible, improbable, and inconceivable (From Movie: Princess Bride).

Looking Back On 2013 Talking Point

Descending Order of Importance:

• 787 Grounding from January Through March 2013
• IAM Rejection of Boeing Moves Boeing Further away from the NW
• Glitching The 787 continues
• A re surging order Book of 797/737's  and 182/787's more to come by January 1.
• The Max configuration freeze
• 787 GE's frosty engine condition
• Japan Airline Airbus A-350 Order
• Charleston Production space expansion in the works
• Dubai Airshow Orders
• Paris Air Show General Duopoly News
• 175-737NG orders for Ryan Air 
• Production Stability in The NW and improving in the SE sites.
• Customers experience immense value in spite of 787 Glitching risk

2014 at a glance:

• 2014 gets its Boeing Team ducks in a row with a new commander
• Prediction: Order Book continues upward climb and catches the NEO
• Prediction: 787- series increase order book pad by another 150 units
• 777X: Gets tangible with GE prototype and A wing Builder site near SLC
• Boeing Announce 777X production location (???) Big money says...
• The Pacific NW tries to a new plan with Government and unions "Relevancy in 2014"
• Boise, ID gets nothing, zippo, scat from Boeing along with 22 other potential sites.
• Airbus gets desperate and moves its first A350 to market.
• Complimentary flights get complimentary about the A350 even though the windows are old school.
• The 787 Glitches becomes the Ghost of Christmas past finally!
• Nancy Pelosi Comments, "you have to fly it first before you can fix it" (awkward)

Rubbing Salt In Everett's Wound Is A New ZIP Code For The 777X

Its now clear that Charleston is destined for "other " things in Boeing's new facility landscape. Several other suitors have been given the never mind  rejection notice. Even my own failure for Boise, ID created a chuckle somewhere in the halls of Chicago, IL corporate headquarters. Oh well, it was worth a shout out.  But what I had ignored is that corrosive salt to the East of Boise.  Salt Lake City, UT is about 20 years ahead of Boise in its industrialization progress. It has at many levels of industrialization and developed a Space and Aeronautical presence for rocket engine testing, airplane tails and composite making. Boeing has two hundred acres adjacent to the airport. Utah is non Union. Technology skills have inspired a can do attitude in the north to south I-15 valley.

The Seattle Times presented A Salt Lake City Chamber of Commerce piece on why Boeing should expand in Salt lake City, UT.  Boise is just a rail stop  on the way to a deep water port on the coast. So I've concocted a new scheme for Boise, ID. The connection by freeway, rail and air is not lost on Boise. A connection for moving pre assembled large parts, spread from here to there could exist and make for a rolling assemble line until final assemble at the end of the supplier flow would be a new way to spread Boeing's foot print in a small region. Boeing could build 777X wings in Boise and ship it by rail in as little as 6 hrs to SLC area for its 777X assembly. Boise could also provide a short airlift hop to SLC from both the NW and Boeing at a rolling assembly of large parts within that corridor.

Salt Lake City has some congestion as most larger cities do as well. Boise could also provide a basis for adjunct computer manufacturing for its aircraft going east and west, connecting Boeing efforts from its subcontractors who manufacture component within the 777X frame.  GE could have a foot print for its Jet propulsion lab as they have already tested Saturn B rocket engines in the area. There are so many possibilities from an intelligent and hard working workforce. As I have mentioned before, technology is what makes Boise hum and it could provide a down the road resource for SLC's already advanced manufacturing as a major metro manufacturing base.

The North West may have worn out its welcome where both Utah and Idahos could offer  Boeing a New way of doing manufacturing with strategically located     centers from  SLC to the coast with stops in between. The manufacturing and supply chain comes from the Union Pacific railroad. Large capacity air freight is found along the way at various locations for moving time sensitive assemblies. It is about 300+ air miles from Boise to Salt Lake City and about 400 air miles from Boise to the NW. The supply chain is continuous from all destination whether by road, rail or air.

Even if Salt Lake City is Boeing's choice, then Boise could be a significant player with much to offer in a non union environment with lots of land available. A concideration for this would take a solid vision by Boeing when considering a rolling assembly centers from one end of the line to the other. Parts from all directions come to Salt Lake City from capable centers such as Boise or Las Vegas that could supply the final assembly if picking Salt Lake City for the 777X.

Boeing's Magical Mystery Tour On A Yellow Submarine

Boeing like a Rock Star moves out on tour being surrounded by city managers, realestate agents and people with money, all crowding in for a signature on its own community charter paperwork. Boeing like a Rock Star keeps on smiling as if on Ted's Most Excellent Adventure. Every community organizer in the nation is yelling like a teenage girl, "Pick me, Pick Me". I too, want Boeing to come to my community, Boise, ID. No chance of that, because our conservative no union base is thinking little tiny thoughts of getting the high school band just to march down to the Capitol building via 8th street with John Philip Sousa renditions of patriotic songs. Its almost shameless how these national communities are begging, screaming or plea for a signature on the community napkin found on the ground. Please  build a Boeing plant just for the 777X within our..., even near our county parameter. "Boeing we want you even in our state, we're desperate bunch of love sick groupies who want you to put a show on/in our school district ,city, state  the North Western region.

Boeing, The Rock Star has an agent, doing the PR work. They know what they are already going to to do. The  "Yellow Submarine Tour" is Boeing making a point with the Unions. Boeing is going to build in Charleston or Texas anyways. The magical mystery tour is just high level PR  campaign that will enable Boeing to make a point by stating its many positions to many people with a fire for effect result on its main target. Today's talking points:

• Unions were worked with (over) and given an opportunity
• The Washington Politicians were worked with (fleeced) and given an ear.
• Boeing seriously wanted an inclusive nation (oh yeah) to participate on this tour.
• The screaming teenage girls (Think Tank) are driving this relocation campaign
• Boeing is a very important Industrial Rock Star, and did every town gets its swag bag?
• Boeing will sing "She loves Me Yeah , Yeah, Yeah" at the announcement party.
• "We all live in a yellow submarine" is a metaphor, you think!
• Abby Lane is not a Boeing address.
• Sargent Peppers Lonely Heart Club, was penned in Everett,Wa
• At the press conference Boeing stated, "I wanna hold your haaaand! In harmony

Now you know how this whole sordid business is being handled. Boeing is the Rock Star inebriated on its own wealth seeking an Alpha for its future X projects. This is not an anomaly with Boeing, the pimping out its industrial might for each project is the new norm. The next great Airplane will be coming to an Industrial Park near you (already decided). The type of business trekking is a new type of industrial progress. Much like a mountain adventurer who watches each step through the boulders and doesn't assume the trail is smooth. The next great airplane will have another full vetting for its location. Because billions will do that for you. The Rock Star can own 5 homes around the world. If tired of the color scheme, they just move to a newly built mansion and sell the old house with its provenance for millions of dollars to the next wanna be.

Human nature is replicated in life with the same theme at all financial levels of life. How long does a Rock Star put up with disgruntled help? Talk to Donald Trump about that. You know him as, Mr. You're Fired. Boeing has a comb over attitude for what it wants to do. Either you go with it, and make as much as you can out the association with Boeing, or get out of the way. Community organizers everywhere are excited about wealth, and Boeing. They are not getting out of the way. They are jumping right in the way of Boeing's plans. Hoping for enough bread crumbs to build new schools and libraries and for re elections.

Am I so jaded that I will speak out like this about Boeing?  No I am not, because its not about Boeing, its about our country. Boeing is in "A Guy's gotta do, what a Guys gotta do", mode, and this nation is obliging the Boeing Sweep Stakes with shameless appeals for local recognition, and a consideration from Boeing. In order for Boeing's scheme to work there must be a demand from a raft of communities (customers) who would like Boeing's services.

Where will this magical mystery tour end? It will end where it started, in Charleston, SC. Boeing can then say, they did all they could  do  for everybody, and now the best decision for the corporation is on Charleston 400+ acre property. Those billion's already invested in Charleston will not go to waste.  They are closer to its launch customer's in the Gulf region by building in Charleston, SC. The hand writing is on the sand near Myrtle Beach. Boeing knows what it will sing, even before it started singing as a group. If only the Chinese or Japan had bought 250 777X's they would have considered the left coast. Don't Forget The Boeing Motto engraved in stone in Chicago, Il.  "A Guy's Gotta Do What A Guy's Gotta Do!

PS:Those yellow submarines are in Boeing's Defense Division in the archive department.

Labor and The Economic Jauggernaut

Not being an economist for the Federal Government I don't pretend to know the answers to our national economic policies. Taking the allotted number of economy classes during my University days only made me aware that a force with natural selection moves the economy around to a point of which it exists under the conditions that are presented. The government tries to influence those conditions for optimal political gravitas thus influencing the voters to keep them empowered. The term macroeconomics and microeconomics comes up only during final exams weeks. I remember that Macroeconomics is the result of forces applied to an open and free market throughout the world of making and selling stuff. You know it as the basic supply and demand paradigm. The enters government again but in a more regional or local influence on its industry and taxpayers. This is called microeconomic for the lack of a more precise idea.

Boeing and its union have a labor proposal on the table. This proposal is a response built on economic principals and not Union hubris of getting more for less from Boeing. However, the Macroeconomics trump the union during the prior no vote on Boeing's offer last month. "Boeing could get it done elsewhere with less hassle" in a cheaper housing market. Yes, the union has raised the price of homes in the Seattle market and costs, Through Boeing's more money to hire people to build its airplanes. You know it as $$ per hour, retirement and medical cost for its employee thing, in a market that has exclusive homes available for every worker who makes as much money in a New York minute than what they do in South Carolina. The union is now proposing a second look. Not with its labor force asking price, but the value it offers Boeing as compared to building a new production center, buying property and hiring "skilled labor" at a lower cost. You know it as "with enough people, with enough experience they can do it right." Board Room Momentum", in play.

James Bond came out with a song for one of its movies "Nobody Does It Better".

Carly Simon Union Plea Song.

Micro Economics is on display with this song. High Seattle Mortgages drive this sentiment because Unions have a preferred salary benchmark found in the area. Micro Soft and others around Redmond, Bellevue, and Bellingham. Assembled a cost of living Juggernaut that propels the same players to ask for more in order to keep up with its own self-induced cost of living increases. Minimum wage is a hot topic in the macroeconomic world. If all minimum wage fast food employees receive a $15 dollar an hour level of pay, which would knock against aviation workers around the country whether union or not. So those cities who think they can do it better, well ... better be careful as homes, raise in price and the local government increases its tax base. In the Northwest the workers already have an increased Tax Base, It increases the cost of living every time they raise the Boeing benefit bar another five dollars an hour within the package. This is a never-ending cycle that both labor and Boeing are trying to dance with, without end!

A solution is needed on both parts of the party of the first and second part. Boeing, no matter where they go with faces the microeconomics just showing up in a new state or even a new country. There are moving cost, local impact cost and a changing cost of living for just showing up at a new place. The Union argues they have paid that price in its NW area with microeconomic pricing, they have the skill set, and Boeing has invested so much in real estate. That a move of the 777X is  "Board Room Momentum" (thinking associated with body parts) that will ruin a sweet deal for all parties. The union says by eliminating all those intangible costs of moving, "We", the union give you the best value for the buck and a guaranteed result. Not being a Union fan it is a powerful talking point, worthy of Boeing's consideration.

Now Boeing is in a predicament they would like off its back. No More Union!!.  The problem I see with Boeing and the Unions is a lack of defined roles in this partnership. Labor wants more of Boeing and Boeing wants more of labor.

I say, "stop the nonsense and define your roles with great clarity". The union brings to the table its exceptional workforce which can't be duplicated without a greater cost on a mature idea (777X). Boeing brings forward capital, sales, and marketing, creating, " the demand" for its product.  Management is the demand factor for the 777X, and labor is the supply factor. Boeing and labor need to choose how they will balance these microeconomic factors to optimum results. Moving is senseless if you haven't dealt with what really ails the relationship. The supply side of labor needs to make themselves available, and I think they are gaining ground in doing that today. The Demand side of Boeing's 250 777X's sales is on the table from management. It isn't worth moving only 250 777X for all the bother of moving. Think 1,000+ plus copies made with your best suppliers in the NW, the IAM.

The union needs to get over the 19th-century strike mentality when shutting down everything every time it doesn't get its way. They are in the market of offering the best labor supply you can find anywhere, and here is the price of quality! Negotiation is for the minutia, not the end-all of an agreement. The offer on the table should not be from creating overstated promises to its membership as a  justification for union dues. It should be the sales job of providing the best value to Boeing for its skilled resources for building the best airplanes in the world. This is what is needed to do that job. If Boeing cheapens out, then Boeing go fish for warm bodies elsewhere.

The membership yells out, "what about the cost of living increases?" The answer to that becomes the minimum wage economic syndrome. Raise the wage beyond value and you raise your mortgagee beyond its value. It then it becomes a 2008 housing market do over. Macroeconomics kicks in with government bailouts, ala king. Then a Manufacturer is seeking cover in China. Boeing must get real and not rip off its supply chain (Labor) in the NW. Boeing is talking to the unions this week because they got all the proposals on the table. They would have already jumped at one proposal, if it beat the NW situation by light years, and been assured of all risks of new manufacturing environment are completely retired. They (Boeing) hasn't made a muster elsewhere, unless the Boardroom acts on peer pressure momentum, Taking it to new depths found during 1929.

Is the real problem with the Boeing Demand sector:, pride, Principal and paupers, or is it gratitude for where labor has brought the execution of its great corporate plan. I don't think elsewhere would do it better. If that is what Boeing corporate really wants is elsewhere, then so be it, mediocrity it is, and an undefined Charleston it will be. The company value was built with a superior supply-side effort, and company success is made with the demand side leadership.

You can make the best item in the world, but without the appropriate leadership at both home and in the market, that great item becomes a museum piece. However, demand needs making a perfectly made product from its supply chain of labor.

The only time Labor should be dismissed only if it fails in its mission. Unreasonable demands from labor are worthy of that dismissal, and unreasonable supply from the demand part is a corporate failure to do its job.

Oh Canada, What Have You Bought? A 737 MAX Eh?

Air Canada has ordered 61 MAX's in a fleet renewal plan. It also coincides with an order placed multiple years back for 24 787's. Air Canada has A320's (Airbus) in its fleet stable that are aging and need replacement. The order announcement is a victory for Boeing on many levels.

• Air Canada had three years to study the NEO
• Air Canada has had just 18 months to study the Boeing Max proposition.
• Both came to Canada with hat in hand offering a winning price.
• Canada ordered Max as it pairs it with its 787  order just as it is about to receives its first 787.
• This marks a turning point for Boeing in the North American Airplane wars as did the Battle of The Bulge turned in Europe in late 1945. They, the opposition ran out of gas in that battle.

Boeing Statement on Air Canada 737 MAX Commitment:

SEATTLE, Dec. 11, 2013 /PRNewswire/ -- Boeing [NYSE: BA] is pleased that Air Canada announced an agreement today that includes commitments, options and rights to purchase up to 109 Boeing 737 MAXs. When finalized, the firm order for 61 737 MAX 8s and MAX 9s is expected to be worth $6.5 billion at list prices and will be posted to the Boeing Orders & Deliveries website.

Fleet

Number
of aircraft

Boeing

777-300 (77W)

14

777-200 (77L)

6

Airbus

A330-300 (333)

8

Boeing

787-8 (788)

1

Boeing

767-300 (763)

27

Airbus

A321-200 (321)

10

Airbus

A320-200 (320)

41

Airbus

A319-100 (319)

35

Embraer

190 (E90)

45

Total:187

Operated by

Number
of aircraft

Bombardier

CRJ 705 (CRA)

Jazz

16

Bombardier

CRJ 200 (CRJ)

Jazz

26

Bombardier

Q400 (DH4)

Jazz

21

Q400 (DH4)

Sky Regional

5

Embraer

175 (E75)

Sky Regional

15

Bombardier

Dash 8-300 (DH3)

Jazz

27

Bombardier

Dash 8-100 (DH1)

Jazz

36

Beechcraft

1900D (BEH)

Air Georgian

14

1900D (BEH)

EVAS Air

3

Total:163

Number
of aircraft

Boeing

767-300 (763)

2

Airbus

A319-100 (319)

3

Total:5

• New Fleet
• Historical Fleet
• Fin Numbers

http://www.aircanada.com/en/about/fleet/

The bread and butter part of its Airbus fleet works as the key component of its every day service. It has a few long range Boeing's, but by observing this chart you will see that 61 new Max's, plus the additional Air Canada purchase options on the same model, solidifies a Boeing renewal and Air Canada's fleet expansion with this order. Ninety-six Airbus are in the inventory. Many of which are to be replaced, sooner rather than later. The Large 777 and A333 is being replaced with the double niche filler, 787 according to any seating configuration that is required. There is no room in Air Canada for an Airbus order. Boeing has flipped it away from Airbus, a North American significant victory. Air Canada shows that it was sold on the Boeing concept of flying the Boeing family, giving it an edge through its various features of common systems, maintenance and pilot layout and flying feel.

This also underscores that Boeing is not only competing with the Airbus myth spinners but beating the Team Airbus with a ground offensive and breaking its spell. Before throwing Boeing under another "Bus", airlines are now carefull of the long term consequences. Some airlines use mixed orders for leverage with each airline against each other. When Boeing matriculates its master plan of all airplanes are built reaching a high level of standardization, it would be difficult to play that game again of "leveraging with mixed orders".

I still don't understand how an airline would mix its fleet when they find a superior product. Air Canada is taking the approach that Boeing has market answers at all levels. Embraer need not worry because Air Canada has the need for 140 seats and under market in mind, of which they can do nicely with all carriers in that arena. Boeing, by this order have the new 777X as an offering for Air Canada when renewing its 2, 777's in the future. The option amount  of up to 109 MAX's is an Airbus order book downer. Another 49 Max's hang out there for fleet expansion later in its growth. Congratulation to both: Boeing and Air Canada validated the market plan that steps side by side with it Family concept of aircraft.

Boeing Wants The 777X Built In A Place Just Like Everett Without The Union

Boeing  is house hunting for all the reason's a person wants a new home. The Union has given Everett a case of dry rot.  Even though the Union has performed well when not on strike. Boeing is gaming the union in an attempt to abate Union's ownership in Boeing by moving offshore away from a Union state. The IAM has been dismissed much to the chagrin of Boeing as it tries to find a new home with new timbers. Boeing values this new program of the 777X higher than most of its NW regions other programs. That is how high the stakes are for Boeing. They want to retain company control over its work force and have essentially fired the contract between Boeing and the IAM, goodbye! As mentioned before on this blog, the NW synergy of suppliers and engineers give Everett an outside chance. It could be that Boeing is still having Seattle's Best Coffee with the Union representative as a side show. I doubt it, but it is possible.

The sticking point is how a benefit is managed over sending a contribution back to the Union leadership for a members retirement and medical. Contracting a work force today is about the whole package rather than forcing the corporation into supplying the benefit.. Many corporations today hire a manpower type human resource and internalize a benefit to that hired workforce. This model erodes Union power from negotiating an all inclusive agreement for its workforce. Or the unions see it as an end of collective bargaining leverage. Boeing doesn't want collective bargaining it wants workforce contracting from  a manpower source. Who hires and redistributes that work force upon demand from the contracting corporation. What is lost by that scheme is a portion of quality control of its labor  force that Union was able to provide. However, if Boeing where to come back to the table and have more input and control over the workforce, they may consider a new playbook with Union in Everett.

• That playbook would eliminate any threat of strike. 
• It would include a benefit package cost within its contract, provided by the union.
• Contract negotiation automatically go to arbitration during a renewal period.
• Contract is one dollar value as a whole from the Union bid or Contracted body.
• Workforce guarantees are in place as to quality and competence.
• Failure by either party is a breach of contract and is subject to legal remedy.
• New contract negotiations is offered in a competitive environment and will be require to adhere to an RFP proposal that all parties must meet in the RFP DOCUMENTS.

and so forth and so forth...

What it essential does is put parties in a no strike mode which must meet workforce standards and put both party in control of its offering. The RFP would spell out competencies  in a not too confining construct for either parties. Minimum standards must be met for completing standard  production work. Minimum standards must also have a certified expertise for said work capabilities and so forth.

A book needs to written on competency ratings for new line of technology where t Boeing would provide education for meeting those new lines of technology.  The workforce is governed by an arbitrator as a third partner where Both Boeing and the contractor are  subject to its determination throughout the work process. Unions try to gain an advantage as well as the corporation. An independent judging board is needed for any work force body greater than, say a 20  person work body within a company.. Both the corporation and the contractor contribute to the financial support of judging body with a pre-agreed amount based on existing contracts.

This idea of of course would open up the labor market and install standards required to complete the work. A Licensed plumber is certified to a certain level of work where  a newly untrained high school grad would have to go specific training to be available work pool of a contractor to work for  a corporation doing that type of work. Companies are required to train those certified workers for specific work on new technology, whether they are formally educated or from a technical certification school. A Boeing worker may have to have multiple credential in a variety of disciplines and apply those qualifications on the production floor. Engineers would have a formal education or an advanced technical educations to be eligible  for an advanced engineering contract firm that would bid on a project like the 777X. However the RFP would lay down required competency for each position within the contract proposal. Its now a big book for the thousands of workers detailing what Boeing would need and what the contractor would provide in a lump sum price. 

It would force people back to school at many levels if they didn't have a certifies minimum competency from the RFP. In fact, work experience is part of that competence. What is eliminated is the union's control over some arbitrary workforce that is told to strike when there is a more up-to-date concept than the union one, from the 19th century. Both players must be responsible for its care of labor. Its not about cheaper is better or more benefits is better. Its about of providing value for its most cherished asset, its workforce! Both are on trial as Boeing tries to shop its way out of this labor mess. One throws back on Boeing the other just walks away in a new direction. Problem solved!

Boeing's problem have just begun on this endeavor as it not have solved anything. It needs to devise a better way taking care if its future people and future plans. They have not side- step a thing. Twenty thousand people in the Northwest in trained and more ready than any other place in the North West. They have a Union between them and a solution. They will move out just to remove the Union. The Union will collapse as people are starved out and replaced by people needing work every where else out side of Washington. Problem is not solved, and will show up later as production tries to ramp up with a handful of old school assemble people brave enough to move somewhere in a effort of salvaging their lively hood.

Its not hard to say these things, since its been done before throughout the history of manufacturing. The young people coming on in the North West, will be defiant. The old hands will move with the Job. The young ones will seek jobs in a slowly shrinking work pool in Seattle, WA work area. Short straw loses. Its simple.

The Dog Days Of Delay "The Glitch's That Steals Christmas"

A Christmas tale comes our way with a dark slant towards, "The Glitch That Stole Christmas", is a real reality that plagues airlines like Air India.  Boeing moved its overly complex 787 to market without testing the supply chain completeness from its suppliers to real world flow of five to ten 787 a month. Coming out of its factory (X's 2). During the testing phase all parts came across in a carefully considered, and tested manner for each test aircraft LN1-LN6.  Production floor of real time assembly was not part of tests that would measure reliability for all its supplying partners. Everybody came across and said "A OK",  and no problem man! Or welcome to Jamaica! Or something clear like that when asked about how they will do when asked about productivity of the 787, and its output each month. Battery was A-OK and checked in 2010 and ready to come out and play.

Air India became a constant complainer that I have taken shots at as they managed the excuse flow in a constant stream every time a delivery was ready on the Boeing board. It seemed the Glitch would steal a delivery and make India's financial planners gleeful as the next 787 would sit another 3 weeks before a delivery. It made the cash flow operations of Air India flexible.

Air India’s Dreamliner fleet has had 136 ‘minor’ problems: Ajit Singh

One hundred thirty-six Minor's hit its fleet during 14 months,, breaks down to about 10 glitches a month with its fleet of 8, 787. Or about one glitch a month for each aircraft if your an averaging type of person. The glitches that stole Christmas for Air India was wide a varied suggesting production is not spot on or its suppliers have consistently provided that Boeing depends on. ANA has had problems too as well as JAL Where JAL has demonstrated a loss vote of confidence through its Airbus A350 order earlier this Fall. Those 31 Airbus were a symbolic block number that Boeing expected and did not receive when considering it would get a follow-on order from JAL, as JAL continued building of its wide body fleet, only with Airbus. However Air India does lend support to the glitching as not something insurmountable and something that can be manage. Many of Boeing's customers are in the same condition as Air India with the "Glitch That's Stealing Christmas" problem. 

Note from India:

"New Delhi: Air India’s Dreamliner fleet suffered 136 “minor” technical problems between their delivery since September last year and till late last month, civil aviation minister Ajit Singh has said.

All these problems were fixed by the airline’s and Boeing’s technical teams, he said in Lok Sabha. Observing that a Boeing team was currently in India to upgrade the software in these planes, he said each Boeing 787 Dreamliner is being grounded for ten days since the beginning of this month for maintenance and these upgrades.

Since September 2012, when the plane’s induction began, till 27 November this year, “136 minor technical snags have occurred on these aircraft which were fixed by Boeing/Air India technical teams with alacrity,” he said in reply to questions.

Observing that Air India was constantly in touch with Boeing on the issue of technical reliability of these new aircraft, he said a team of engineers and technicians from the American manufacturer was installing a reliability enhancement package involving upgrades to the software and components in the aircraft. The Boeing team is also involved in the root cause analysis and evolving remedial measures, he said."

Another Glitch related gremlin remark follows:

"Regarding a panel falling out of the belly of one Dreamliner as it landed in Bengaluru few months ago, Singh said the Directorate General of Civil Aviation (DGCA) was probing the incident and its report is awaited.

On the overseas battery-fire incident this January involving the same aircraft operated by a Japanese carrier and consequential grounding of Dreamliners the world over, the minister said the requisite rectification was carried out on the battery units of the aircraft of Air India, following which the planes were put back in service in May."

Air India is ready to move forward with its investment. It is interesting to note how subdued the Indian response is for all those 136 glitches on its fleet. Perhaps all that irritated posturing before each delivery from a glitch was a an exhale and a sigh of relief they purchased a winner. The glitch wants to steal Christmas as the press eagerly awaits its next problem found in an emerging aircraft. The sanctification of the Boeing 787 is not long in the wait. Boeing has tasked itself with an all hands on deck assembly of its most expert team members for tracking down anomalies found on the 787. The first 787-9 will be light years ahead of the LN10 aircraft sitting in Everett's EMC warehouse awaiting upgrades to the level of the last 787 built this week. Those aircraft in the EMC are sitting for a long while more since both the customer  and Boeing are waiting together for a completeness delivery time. That time is driven by the customer as to when it will take delivery. Those terrible teens are deeply discounted early production numbers. Each month that goes by, is one more month in EMC catching up those aircraft with today's out the door delivery. Once the customer signals ready for delivery, they will be delivered within two months of that call out.

The Glitch that Steals Christmas is any lack of patience in this process of meeting original expectation. Expectation starts with this short list.

• 15% fuel economy over current aircraft. Done= 20%
• All electric architecture is the answer= Battery issue is a RIP issue today
• Systems Update requirements. Ongoing for the life of computer systems and airplane

These are of the few of the major issue not defined after the first dozen delivered aircraft. The Glitching really going down and has permanent installations or solutions driving each glitch away from the aircraft. Software upgrades, installation procedures correcting weaknesses revealed during long term operation, and changes in the supply chain. All these are the maturation of any aircraft model. Overstating for what it really is, is how the news works. The 787 is made with millions first time parts and systems is doing well as expected. Millions of opportunities exist out there with this overly tested aircraft. But the right combinations of conditions come up on the 787 during daily operations. 

That is where safety measure anticipate any kind of failure and report. Once the 787 lands a s system reports that 136th glitch to Air India and Boeing is brought in to perfect the 787 one more time. The 787 is being cured as a fine piece of art fused with science and engineering. The glitch report makes it one step closer too perfection watching those millions lines of code, million parts, and the all new architecture  never before used. Now the customer have its say through how the 787 speaks to them. Boeing relies on the 787 feedback after its rigorous testing program. Because of the glitching the customers are building a better aircraft. Airbus can't say that at this time. The best aircraft will emerge in two years at which time the 787 maturation is dependent on what the 787 reports. 

It will heal itself by flying more and more. The systems are there to keep it so safe and dependable. The battery glitch is the prime example. In another era you would have seen a sky bound fire ball without any solution. The 787 landed safely multiple times with battery issues, enabling a battery solution of major importance. The longer the 787 flies in this stage the greater Boeing sets a lead over it competition with its gamble.

When The MAX Flies Will The NEO Flee?

It’s coming to the point of Boeing's pre-flight (fight) bravado will soon enter the ring for the knock down drag out fight for single aisle supremacy of the world. As the Max enters the market ring, it will have to demonstrate to its customers if it has the chops to defeat the NEO. In a knock down drag out fight to the bitter end. Its own customers are the fans around the flight ring. The ring announcer is now reciting the exploits of each contender. Boeing has announced its "Tale of the Tape".

In this corner is the MAX:

• The Boeing Max has 13% better fuel than current or similar models flying
• The Boeing Max carries more seats than its competitors.
• The Boeing Max has the "Edge Program".
• The MAX new CFM, is a purpose built high efficiency engine.
• The MAX has dual feathers that will take where you need and want to go.
• The MAX commonalities sync with the worlds most advanced aircraft.
• The support staff can do its job quicker and more effectively with the MAX.  

And in this corner is the NEO:

• The NEO is a New Engineered Offering.
• It has the majority of the fans in the house at 60%
• It is 5% more efficient than current models flying
• It doesn't have the Boeing Edge
• It holds less seats than the MAX.
• It maintains commonalities with the A-350 that hasn't reached the market.
• The support staff cannot train it to keep up with its competitor. 

This fight will not allow price gouging, no order holds, and finally no grounding biting. Shake hands and may the best single aisle win! The is the preview for the fight during the next 20 years for certainly something new will come of age by 2030 as manufacturing technology catches up with today's plastic designs. 

The brave new world of Boeing took the first big step in making an all plastic hull. Even though other airplane makers made smaller versions of plastic aircraft, but not on this scale or technological enhancements. 

The problems that the 787 have become lessons learned. While other airplane makers try to avoid by not installing that technology. Making those competitors airplanes less robust, but more manageable during operations. Once the 787 matures (it’s almost there in that maturity) it will be light years ahead of its competitor. The year 2014 promises full maturation for the 787. 

The maturation of the 787 transcends to the MAX and  the 777. The full circle of Boeing's goals will be achieved in 2014 through a 787 completeness process during operational cycles. Always improving will not retire, but makes its original vision achieved for the Boeing's aircraft family during 2014. 

Much work remains, but the "much work" is more purpose directed through its retired risks from its most advanced program. That completeness process will continue until that day the 787 receives its championship heavy weight belt. 

The coming of the MAX is bringing forward what really exceptionally works from all of Boeing's programs. The funnel of Boeing's intellectual capital flows down to its multi funneled tips, whether it’s the MAX program, 787 or 777. 

I don't mention the 747-8i, because it’s a forgone conclusion that Boeing is waiting on the market development, before it tries its next big Jumbo project. The 747-8i is just a sponge, in that it sponges off from everything from Boeing’s project to keep it relevant and operational. 

There is not enough market remaining to go all-in and battle the A-380's share of the market. However, it is a staunch niche airplane type that has a shelf life within that its special market. Keeping the 747 alive is a strategy that maybe the market will come back to it as the A-380 flounders eventually. I would expect a 747 class twin as the next right sized Jumbo. The 777-9 is a progression towards that end. A 450 seat Jumbo twin with a 747 moniker is a possibility today but will wait after they 777 is relaunched.

Boeing can only make the 787-8i better as each new proven technology can advance to it. The 777 is really the big player, more than the supersized A-380 play. The A-380 has to redesign airports as they proudly clog terminal areas. The 777 dual engines will retire the Jumbos from passenger use. 

The 747- 8F can reconfigure to haul basketball gym size cargo loads as exampled by the 747-400 dream lifting mission for the 787 project. The 747 has a future with a specific purpose. The A-380 future is in question by its customers. The Middle East has a scheme that desires nothing but capacity for people.

The world cannot accommodate a wide spread use of the A-380 with its current airports unless those airports expand. Doing so would literally scatter traffic in its wake on final approach. Not a happy proposition for airports that has heavy traffic. London Heathrow and LAX to name a few, wedge those flights in. It isn't for the likes of San Diego or the Caribbean. 

This article is about the fly and the flea. The Max will fly as the NEO will flee in time. The early orders for the NEO during its inception, did not have a MAX as a contender. So loyalty customers for Airbus poured in the orders. Even some new customers were septet-up in that first year. 

The MAX arrived 18 months later and has been on a steady march forward and is closing the gap. What will be interesting are those neutral customers in a head to head sales competition, for which type they will choose. I admit I haven't looked at those types of competition at this time, but is a worthy project to do so. 

My next 737 vs the NEO project is to look at the split order sales and try to look at the customer on how they ordered and for what reason.

Looking at the pre-flight Boeing Bravado, makes me feel they actually have a winner. However, I never underestimate a worthy contender like Airbus. If what Boeing says about the MAX, if in fact is not fiction about the MAX, then the Market place will validate the MAX with follow-on orders after both airplanes are in operation. 

Right now it’s a loyalty battle and a curiosity endeavor for those who are unsure, but want to find out. The NEO has a strong order book from loyal customers, the curious and bargain hunters. Even though Boeing was late into the game they have made up substantial ground, and have saved its single aisle program from the flight of the Do-Do Bird. The Max will in deed fly, and the NEO will take its respectful place in the market when all is finished.