Blog

– How the 787 backlog was built
– Predicable costs at 787’s foundation
– Scott Carson’s ascent
– Can the 787-9 undo the damage?
– Looking at 17 787’s per month
– The revival of the 787-10
– Redrawing the supply chain lines

Data obtained by FlightBlogger show Boeing’s historic order backlog for the 787 was based partly on steep discounts driven by now-discarded design and manufacturing assumptions. Cost overruns, penalty payments and supply chain changes adopted in the last two years will force Boeing to achieve unprecedented cost-savings for the widebody to turn a profit even after delivering the current 846-aircraft backlog.

With first delivery nearly three years behind schedule, the cost to build each 787 has skyrocketed from its original foundations built upon dramatically lower and more predictable production costs, say company insiders.

In the race to sign up customers between 2004 and 2006, airframe prices averaged just below $76 million, a price that does not include the the $20 to $30 million GENx or Rolls-Royce engines, buyer furnished equipment (BFE) and in-flight entertainment (IFE), according to pricing data.

While Boeing will never disclose the actual prices its mega-backlog of 787s were sold for, Jim Albaugh, CEO of Boeing Commercial Airplanes, believes the 787 was sold for far less than it was worth, as acknowledged in a recent interview: “I think we gave away some of the value of this airplane to a lot of our customers.”

Though that statement, say customer and company sources, as well as industry analysts, is an understated acknowledgment that hints at how Boeing’s 787 backlog was built; stimulated not only by huge future growth in air traffic and precipitously rising fuel prices, but a steady and strategic drop in the price of the aircraft.

Boeing, which did not comment on the actual pricing figures, says it is “constantly evaluating our value proposition in the marketplace. Prices are adjusted based on the value our products provide to our customers as well as our positioning in the competitive environment.”

In late 2004, Boeing started employing aggressive sales tactics, according to sources familiar with the pricing discussions, blunting the ambitions of the original Airbus A350, then a significantly upgraded A330. That aggressiveness, led by then sales vice president Scott Carson, with a mandate from then-CEO Harry Stonecipher, then-Commercial Airplanes Chief Alan Mulally and the Boeing board of directors, saw prices slashed on the company’s composite jetliner.

In the more than three and a half years since its first 787 began assembly, the prevailing wisdom about Boeing’s woes have centered upon moving past manufacturing design issues, completing extensive rework of production airframes, certifying and delivering the first units for revenue service and building a steady industrial ramp up at its Everett and Charleston facilities; all while re-balancing its supply chain as it develops the 787-8’s larger successor.

Although each is a formidable task, the pricing data indicates Boeing also must overcome five-year-old pricing decisions on more than 300 787s still in the backlog.

The 2004 through 2006 airframe prices charged to airline customers ranged between $83.5 million and as low as $65.7 million for the 787-8, for one higher volume deal with a blue chip customer. Prices for the larger 787-9 were cut significantly as well, but the sales balance in the early years of the program was weighted heavily toward the smaller -8.

There remains great risk and opportunity to ensure the 787 – the company’s fastest selling jetliner – becomes the cash cow Boeing hopes it will become. Few doubt the market success of Boeing’s flagship program, though the profitability and margins remain open questions as the recurring production costs, by the company’s own admission, lack clarity.

Boeing declined a request for executives currently leading the program, as well as Carson, though the company did comment on a point-by-point basis.

Photo Credit Air Show Fan

DUBAI & BEIRUT — The Brazilian captain is introduced by our Australian first officer, along with the cabin crew from Egypt, Russia, Khazakstan and India. You can converse with them in nine different languages: Russian, Spanish, Italian, Japanese, Hindi, Urdu, Pashto, Arabic and English. It sounds like it could be a United Nations charter for the world’s diplomats, but it’s not, it’s Flydubai, the United Arab Emirates’ new low-cost carrier.

As the unofficial capital of the globalized world, Dubai is the poster child for the planet’s seemingly insatiable appetite for commercial aircraft. While Emirates, the better known flag carrier of the Emirate of Dubai, is by far the largest airline in the region as the planet’s largest 777 operator and its global ambitions with its mega backlog of 90 A380s and 80 A350. Its long range aircraft connect distant points through its Middle East mega-hub.

Emirates and its world famous full-service premium classes may stand in contrast to all-economy the Flydubai and its 13 737-800s with 189-seats, the most the type can accommodate. But Flydubai doesn’t want you confusing low-cost with low-quality, debuting two passenger pleasing industry firsts: The Boeing Sky Interior and Lumexis ‘Fiber-to-the-seat’ (FTTS) in-flight entertainment system.

While their base of operations may be the same, Flydubai exists in a world that is separate, yet inextricably linked to Emirates. “We are one family…for the good of the country and the customer,” says Flydubai’s CEO Ghaith Al Ghaith.

Today is December 17, 2010, 107 years after Orville and Wilbur Wright made their first flight at the beaches of Kitty Hawk, North Carolina. Needless to say, a lot has happened since then. Just 65 years after that first flight, which saw Orville at the controls of the 1903 Wright Flyer, the maiden sortie could have been accomplished in the span of the wings of the Boeing 747-100. 

The Wright Flyer, or at least the nearest replica to the aircraft, is enshrined at the Smithsonian National Air and Space Museum here in Washington, DC. The aircraft, in fact, did not arrive at the museum until December 1948, at the conclusion of a decades-long feud between the Wrights and the Smithsonian surrounding the brothers’ claim of being the true inventors of the airplane.

Aviation is an afterthought for most in the industrialized world, we transit seamlessly from one distant point to another thinking only of the destination or origin. The duration of our journeys are slashed by days, weeks, months, perhaps even years from their original attempt. Today, we are nagged by airport security, bad food, tight economy seats and what we perceive to be long waits. I’ll allow comedian Louis CK to put it all in context. 

This photo hit my inbox this morning and it was just too good not to share. This photo, believed to have been taken around November 28, shows the 747-400 LCF Dreamlifter (N780BA) sitting between Lufthansa’s first A380 (D-AIMA) and Qantas’s second A380 (VH-OQB) inside Lufthansa Technik’s Hamburg Frankfurt, Germany hangar. 

The perspective of the photo makes the A380 look significantly larger than the LCF, which is actually longer than the Airbus superjumbo. If nothing else, the scale of the Lufthansa Technik hangar is really what’s on display here.

Travel Night: DXB-IAD, originally uploaded by flightblogger.

Aviation journalist Tim Robinson, who serves as editor of the Royal Aeronautical Society’s Aerospace International magazine, sat down with David Evans, who was one of the two check captains on board Qantas Flight 32 (in addition to the crew in command) when one of the A380 VH-OQA’s four Rolls-Royce Trent 900 exploded shortly after takeoff on November 4.

Harry Wubben (Route Check Captain, 20,000h), who was sitting next to Evans, shot the photo above from the center seat on the A380’s flight deck, and was sitting with Richard de Crespigny (Pilot in Command, 15,000h), Matt Hicks (First Officer, 11,000h and Mark Johnson (Second Officer 8,000h) during the take off from Singapore. As you can see, the aircraft’s number two engine has completely dropped off on the center display. To provide a sense of the depth and detail covered, here is a brief excerpt from the interview:

The Engine 2 was shut down. Part of the damage caused Engines 1 & 4 to go into a ‘degraded’ mode. The engines were still operating and Engine 3 was the only engine that was operating normally. Basically, dealing with all those things took some time, then the next series of messages were hydraulic problems. We had indications that the green hydraulic system was losing all its fluid. The Airbus A380 carries two and, unlike most conventional aeroplanes, most flying surfaces aren’t powered by hydraulics, they have their own electric-hydraulic actuators. There is a green and yellow system and they spilt their duties between things like brakes, undercarriage retraction/extension. With the green system out we had to deploy the nose gear and body gear using the gravity extension system. With the loss of the green system we dealt with that and curiously we had the hydraulic pumps of Engine 4 indicating failed as well. Engine 3, the trusty engine, was the only engine that was producing hydraulics for the aircraft for the yellow system.

Robinson’s also includes several additional photographs taken by Evans on the flight deck, as well as up-close shots of the aircraft and its destroyed main gear tires after the landing. A complete 30min recording is also available with the text of the interview. 

DUBAI — Until now, Boeing has allowed artist to interpret the look off a re-engined 737, taking artistic liberties about what a major update to the narrowbody would look like. 

A publicly available Boeing presentation hosted on the website of the Federal Aviation Administration on technologies to improve the environmental footprint of commercial jetliners, may provide an unintentional first-look at one of the potential configurations for a re-engined 737.

The presentation details the airframers plans for the Continuous Lower Energy, Emissions and Noise (CLEEN) program designed to use 737s and 787s are demonstrators for new technologies. Slide eight of 25 presents the timeline for the testing, which is set to last through 2014. 

On the slide is a series of generic images, including one of a 737 undergoing wind tunnel testing at a Qinetiq facility, which on closer inspection features a landing gear nose blister and significantly larger engines. Could this be one of the 737 re-engining concepts Boeing was wind tunnel testing earlier this year?

Most notable is the addition of a nose blister, which resembles that employed on the Airbus A330-200F, to accommodate the lengthened nose landing gear, which need to grow 8in to raise the larger nacelles to achieve appropriate ground clearance.

John Hamilton, 737 chief engineer, said in an Airshow China interview in Zhuhai last month the design must maintain 17in clearance from the ground to avoid contact with taxiway lighting.

Boeing has toyed with the idea of shifting some of the components in the forward electronics bay to the aft bay to make room for the longer landing gear. 

The larger engines, which are almost certainly designed to accommodate the CFM Leap-X, appear to have an elongated nacelle sitting nearly on the same plane as the pylon, shrinking it significantly, allowing the engine to ride higher on the wing.

Boeing has moved away from this concept in recent months, opting to focus on a series of smaller incremental improvements to the narrowbody, including the new Sky Interior, aerodynamic refinements and updated CFM56-7BE engine.

However, the model provides some insight into the amount of modification required to add the new engine to the wing of the 737. The airframer has promised a decision in 2011 that may give a green light to re-engining, an all new jetliner or another set of incremental improvements to the venerable narrowbody.

Naturally, Flightglobal technical artist Tim Bicheno-Brown took a crack at an artistic interpretation of the wind tunnel model: