Oykie From Norway, joined Jan 2006, 2647 posts, RR: 4 Posted (4 years 1 month 2 weeks 6 days 13 hours ago) and read 6914 times:
• Third-quarter revenue was $16.7 billion, 9 percent higher than last year's strike-affected quarter
• Loss of $2.23 per share reflects $3.59 per share of expenses related to previously announced 787 cost reclassification and 747 charge, partially offset by solid performance in other commercial programs and the defense business
• Operating cash flow increased to $1.2 billion
• Backlog at $320 billion - nearly five times current annual revenues
• 2009 guidance updated for 787 cost reclassification and 747 charge
Read more here:http://boeing.mediaroom.com/index.php?s=43&item=891
Is it in this report that Boeing will shed light about a possible further 787 delay?
Anyway, it is nice to see Boeing performing good one year afte the economic melt down.
[Edited 2009-10-21 04:40:52 by oyKIE]
Dream no small dream; it lacks magic. Dream large, then go make that dream real - Donald Douglas
OyKIE From Norway, joined Jan 2006, 2647 posts, RR: 4 Reply 1, posted (4 years 1 month 2 weeks 6 days 13 hours ago) and read 6871 times:
Quoting Oykie (Thread starter): Is it in this report that Boeing will shed light about a possible further 787 delay?
I was too quick in publishing the report and dit not see, that Boeing remains on track
Quote: The 787 program has begun the previously announced reinforcement to an area within the side-of-body joint. First flight of the airplane remains on track to occur by the end of 2009, with first delivery scheduled for the fourth quarter of 2010.
Dream no small dream; it lacks magic. Dream large, then go make that dream real - Donald Douglas
Kappel From Suriname, joined Jul 2005, 3533 posts, RR: 18 Reply 4, posted (4 years 1 month 2 weeks 6 days 12 hours ago) and read 6735 times:
Wow, you have a whole thread for yourself, lol.
Sucks to see Boeing in the red, but so was Airbus during the a380 delays IIRC. I really hope that 2010 is a much better year for them, with first flight (still in 2009 hopefully) of both the 787 and 748 (and maybe, just maybe also first delivery of both)
Keesje From , joined Dec 1969, posts, RR: Reply 6, posted (4 years 1 month 2 weeks 6 days 11 hours ago) and read 6527 times:
I guess everybody is a bit tired of announcement that are revised shortly after, discussions about costs and who blames who. I want smoking tires, howling engines, sliding tail blocks and shiny worldtours..
Stitch From United States of America, joined Jul 2005, 28492 posts, RR: 84 Reply 7, posted (4 years 1 month 2 weeks 6 days 10 hours ago) and read 6338 times:
ZA001, ZA002 and ZA003 are now Research & Development frames and $2.6 billion in R&D and production costs have been assigned to them.
787 Side-of-Body fix is proceeding and the final changes to the four problem stringers will be completed this week(?) and then installation can continue.
747-8F required significant re-work at both PAE and suppliers due to constrained engineering sources. 747-8F production rate will not be increased per plan due to the soft cargo market. Third frame production is proceeding much more smoothly than the first and second. The first two planes have completed Power-On.
747-8 Intercontinental has reached the 75% mark for engineering drawing release.
7200 HR positions reduced in 2009. By 2010 headcount should be down over 10,000 from November 2008.
113 commercial deliveries in Q3 2009 with an additional 85 planned Q3 commercial deliveries deferred to later quarters. 130 commercial deliveries deferred in H1 2009. Current deferrals run about the same as 2008.
Stitch From United States of America, joined Jul 2005, 28492 posts, RR: 84 Reply 8, posted (4 years 1 month 2 weeks 6 days 9 hours ago) and read 6249 times:
Investor Questions One:
Q: How will you manage concurrent 787 and 747-8 flight test and production before first delivery?
A: Organizationally, we have combined our flight test groups to allow us greater flexibility and coordination to perform both schedules per plan. On inventory build, by first delivery we believe will have a total of 30 787s and 747-8s completed prior to that milestone.
Q: Unless R&D declines materially, how will Boeing grow earnings over the next 3-4 years?
A: When we get to an end-state of the current transition, we will have a more competitive company. IDS is improving gross margins and the 787 and 747-8 should build on a solid 737/777 foundation.
Q: Is the original 787 profit case still valid with the delays and higher costs based on the original discounts and cost escalation clauses?
A: Even with all of the compensation claims, there is room to do better.
Q: What went wrong with Boeing's processes at designing and building commercial airplanes?
A: The market for new planes grew overheated and we went to an aggressive development schedule with increased outsourcing on the 787 to meet it, resulting in a "bleeding edge" development and production process which we are now recovering from. Going forward, we cannot overreach ourselves to meet unrealistically set goals and we need to bring more of the engineering back into Boeing and improve engineering oversight and management within Boeing and the suppliers. We also need greater visibility of partners and suppliers.
Q: Is there an engineering shortage within the company?
A: The quick answer is no. The 747-8F engineering issues were more a result of both that and the 787 reaching their "engineering peak" at the same time as opposed to two separate peaks so the manpower planning ended up being different than planned which resulted in reality getting in the way of planning and we need to better manage "surge capacity".
Manfredj From United States of America, joined Mar 2007, 1132 posts, RR: 0 Reply 9, posted (4 years 1 month 2 weeks 6 days 9 hours ago) and read 6183 times:
Quoting Stitch (Reply 8): Going forward, we cannot overreach ourselves to meet unrealistically set goals and we need to bring more of the engineering back into Boeing and improve engineering oversight and management within Boeing and the suppliers.
That's interesting. We've been discussing this for a few months now. This outsourcing is the direction the world is going in and I'm not convinced it works when building aircraft.
Bring the engineering back, weed out the needless supply chain to gain more strength and control over the build process.
It's ok to "experiment" with outsourcing, but when you begin to see it isn't a profitable, maneagable build method, go back to what works best.
In terms of outsourcing, what percentage has 787 seen in comparison to other aircraft like the 777?
Stitch From United States of America, joined Jul 2005, 28492 posts, RR: 84 Reply 10, posted (4 years 1 month 2 weeks 6 days 9 hours ago) and read 6116 times:
Investor Questions Two:
Q: How are you working through 787 supplier claims in general? What is the nature in the way you take these large claims and settle them? And considering the original planes are far more expensive than planned, how will unit price escalations affect future deliveries?
A: The costs of building the first tranche of planes will be higher and we have accounted for that. We will do detailed cost-analysis on later tranches and we believe we have a pretty good handle on those costs and believe they will be better than we originally planned. We have a great deal of time due to the forecast demand to settle these over time.
Q: Are you confident IDS will be able to maintain 10%+ margins going forward?
A: As the volume decreases, there will be pressure to maintain margins at 10%, but we feel we can still maintain them through continually driving productivity and contract negotiations.
Q: Will the 787 still fly by year end with the fix in process?
A: We expect and believe it will, even as we continue to work with issues as we factored those issues in.
Q: Has Jim Albraugh expressed any worries about the 787 flight and production schedules?
A: He has accepted the flight test and production programs. He feels the flight test program can and probably will create new issues, but they feel they're ready for them if and when they do happen.
Q: You mentioned 85 Q3 deferrals. How does this affect your confidence for future 737 and 777 production rates?
A: We feel we're okay with the 777 program with the planned production rate reduction. 737 deferrals are running to what we planned and we feel that the 737 rate can remain stable with those deferrals. We feel that delivery demand in 2011 and 2012 is trending towards increase, not decrease.
Q: Are you finding it difficult to pull customers forward to meet deferrals?
A: No. We're sufficiently oversold on both programs to allow us to find customers who want deliveries ahead of plan to meet those that wish to defer. We're sufficiently oversold in 2010 to handle all predicted deferrals and also have enough in 2011 to handle some early deferrals.
Q: When will the six 787s fly and can you sell the final three?
A: ZA004, ZA005 and ZA006 remain marketable. We expect one new test plane entering the test rotation every month once ZA001 takes to the air.
Stitch From United States of America, joined Jul 2005, 28492 posts, RR: 84 Reply 13, posted (4 years 1 month 2 weeks 6 days 9 hours ago) and read 6048 times:
Investor Questions Three:
Q: Is 2010 currently sold out in terms of commercial deliveries?
A: 2010 is indeed sold out and we feel that the levels of deferrals has stayed stable enough that we have enough oversolds in the pipeline to maintain production.
Q: There has been some talk in the marketplace that Boeing has an advantage in the KC-X RFP?
A: We're still looking through the RFP so we don't know at this time if or how the RFP helps or hinders us. We do believe that the WTO has ruled that the playing field is not level between Boeing and Airbus and that should allow Airbus an advantage to take more risk on in meeting the KC-X RFP then Boeing can.
Q: Every few months we hear confident statements on 787 schedule and program developments. Then we hear that things are not so rosy. Where does the buck stop on all these program delays?
A: The entire leadership of the company is involved in getting the 787 to market and we all share responsibility in it not going as smoothly as possible, but we also all share the responsibility to make it happen.
Q: On the second 787 line, is the decision down to Everett and South Carolina? Or are you looking at other sites? And do you intend to announce the decision soon?
A: We have narrowed the location for the second line down to those two sites and will make a decision within a few weeks.
Q: (Jim Wallace from the Seattle Times) Why would you consider putting a second line in South Carolina which to many people seems to increase the program risk, as opposed to reducing it?
A: There would be execution risks, however South Carolina is a major 787 production site right now. We feel diversifying our labor pool and relationship has benefits. We have had problems with the IAM and I need to figure out a way to reduce those risks. So compared to a strike, the extra costs of having two disparate lines is far less. We don't feel the union alone is at fault, as we have not been able to come to an agreement with them, but we feel that without the strike, the company and the 787 would be in a better financial position today.
Manfredj From United States of America, joined Mar 2007, 1132 posts, RR: 0 Reply 14, posted (4 years 1 month 2 weeks 6 days 9 hours ago) and read 6030 times:
Quoting Stitch (Reply 10): A: He has accepted the flight test and production programs. He feels the flight test program can and probably will create new issues, but they feel they're ready for them if and when they do happen.
Oh my. Is this a hint of things to come or a safety net in case they do occur? Are there always problems after and during the flight test program?
Quoting Astuteman (Reply 11): It certainly doesn't do work if you haven't developed the necessary core competencies needed to manage it properly in a timely manner.
The delays certainly were the end result of mismanagement, but was South Carolina an attempt at stopping the bleeding, or did that come before the delays?
Dallasnewark From Estonia, joined Nov 2005, 492 posts, RR: 1 Reply 15, posted (4 years 1 month 2 weeks 6 days 9 hours ago) and read 6019 times:
Quoting Astuteman (Reply 11): It certainly doesn't do work if you haven't developed the necessary core competencies needed to manage it properly in a timely manner. That doesn't necessarily mean it doesn't work.
The only benefit of outsourcing is that it is cheaper, but the qulaity of work is not the same, usually the quality is a lot worse. It is true for every industry, call centers, IT, technical support, it is cheaper to outsource but the quality provided form that is subpar to put it nicely.
Why don't you call AA or DL and get one of their agents from the offshore and ask them a question a bit more complicated than travel from point A to point B and you will see how fast you would be trasnfered back to the onshore operator.
Stitch From United States of America, joined Jul 2005, 28492 posts, RR: 84 Reply 16, posted (4 years 1 month 2 weeks 6 days 9 hours ago) and read 5979 times:
Quoting Manfredj (Reply 9): In terms of outsourcing, what percentage has 787 seen in comparison to other aircraft like the 777?
It was close to 100% on production. Prior to taking over Vought's production, about the only thing Boeing built for the 787 is the vertical fin and some fairings and the gear doors. I'm not sure on the engineering side.
As for the 777, Japan alone provides 35% of the parts.
James Bell said that they felt that even with the compensation, the program overall is still profitable even though profits will be pressured on the first tranche of planes.
Right now it looks that Boeing plans to spend about $750,000 per frame on compensation this year.
Quoting Tarheelwings (Reply 12): This comment is key, is it not? He's saying they still believe they'll fly the 787 by year end as the issues that have sprung up were expected and more importantly, planned for (in terms of schedule).
But then, they've consistently said this before and somehow they continue to keep falling behind.
Dougbr2006 From Brazil, joined Oct 2006, 390 posts, RR: 1 Reply 18, posted (4 years 1 month 2 weeks 6 days 8 hours ago) and read 5929 times:
Quoting Stitch (Reply 7): 787 Side-of-Body fix is proceeding and the final changes to the four problem stringers will be completed this week(?) and then installation can continue.
So the bloggers again prove to be correct, if it wasn't the design would be final and verification would be almost done. Boeing are great at mincing their words to give indirect - well, errr, maybe answers. I noticed also they didn't like talking mush to John of Flight International alias Flightblogger!!! your call is distorted well at least in my ears I heard every word the first time !!!!
TomB From United States of America, joined Nov 2006, 78 posts, RR: 0 Reply 21, posted (4 years 1 month 2 weeks 6 days 7 hours ago) and read 5606 times:
I am not a big fan of outsourcing the major components of the airframe. Boeing did outsource a major investment in the capital expenditures for mandrells, tape laying machines and autoclaves to subcontractors. However, over the years Boeing will pay for the those capital expenditures as those amortized costs will have to be included in the price of the major components purchased by Boeing.
By using outsourcing for major components, Boeing incurs significant other expenses:
1) they have to have a highly qualified management team providing oversight of the subcontranctor,
2) they have to have a highly paid team of contract negotiators continually negotiating contracts and change orders witht the subcontractors.
3) and the after the major component is finished, they have to inspect the components and then fly it thousands of miles in the Dreamlifter to reach the final assembly point.
I believe the three oversight and transportation costs listed above could pay for a large amount of direct labor if Boeing manufactured the major airframe components in house. If Boeing manufactured major components in house, they would have to step up and make a major investment in capital equipment to manufacture fuselage barrels and wings, but the manufacturing processes are largely automated. The direct labor component of manufacturing the major airframe components is not that high and I believe could be be completely offset if Boeing did not have to pay for the oversight of subcontractors.
I estimate that the cost of direct labor in the United States, Italy and Japan is roughly the same and you do not reduce your total direct labor costs by subcontracting to Italy and Japan.
Going forward, I would thus recommend that Boeing do most of the engineering in house and produced all of the major airframe components at the same location where final assembly will occur. It will increase capital expenditures for aircraft programs but give them a much more efficient production process that will save them a lot of money over the life of the aircraft program.
And finally, I would recommend that Boeing separate the R&D and prototype timeline from the commercial production timeline. Boeing has incurred billions and billions of unnecessary expenses because they tried to start commercial production before they had a proven prototype.
Boeing has really mismanaged the 787 program but perphaps they can learn from all of their mistakes and successfully manage the 777 and 737 replacement programs.
AirNZ From , joined Dec 1969, posts, RR: Reply 22, posted (4 years 1 month 2 weeks 6 days 7 hours ago) and read 5409 times:
Quoting Manfredj (Reply 9): That's interesting. We've been discussing this for a few months now. This outsourcing is the direction the world is going in and I'm not convinced it works when building aircraft.
Why should it be invalid, or not work, solely for building aircraft? It works for other's so why imply it doesn't work just because Boeing got it wrong for the 787?
Quoting Dallasnewark (Reply 15): The only benefit of outsourcing is that it is cheaper, but the qulaity of work is not the same, usually the quality is a lot worse. It is true for every industry, call centers, IT, technical support, it is cheaper to outsource but the quality provided form that is subpar to put it nicely.
That is a very generalised statement and in no way definitively true. A lot involves very inaccurate perception.
Quoting Dallasnewark (Reply 15): Why don't you call AA or DL and get one of their agents from the offshore and ask them a question a bit more complicated than travel from point A to point B and you will see how fast you would be trasnfered back to the onshore operator.
Perhap you should rephrase that a little better, because I can absolutely assure you that American agents are in no way 'superior' in travel knowledge just because they are American! There are several factors involved there, so perhaps you should research them first!!