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Antarius
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 5:56 pm

scbriml wrote:
They have $6.5 billion less profit than they would have had if they hadn't taken the charge.


Again, false. This is not how GAAP and impairment charges work.
Militant Centrist
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morrisond
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 5:57 pm

Revelation wrote:
morrisond wrote:
Revelation wrote:
To expand, they essentially wrote off the whole R&D program because they could no longer project the sales needed to cover $6.5B of costs. It's the ultimate "vote of no confidence" in the 777X program. They could not even scrape up potential sales to cover half the cost, or a quarter of the cost, etc.

It could also been seen as taking advantage of the situation so that when deliveries do happen eventually they can show healthy profit/cash flow on the initial frames.

On the other hand they may have to do it as they had to give further concessions on price - but I don't think there are many customers that will be upset by a later delivery date given the circumstances, so the price concessions may be small.

Taking the loss earlier than necessary could be grounds for legal action. It'd be fraudulent. Current share holders could claim they are being harmed so that future share holders can profit.

IMO Boeing is not pulling a fast one. They genuinely cannot find a way to avoid taking the write off on 777X, the prospects are that weak. It'll take a huge reversal in fortunes for 777X to survive long term.


Fraudulent - not likely in this era of "Adjusted Earnings". Most companies numbers are so baked right now most CEO/CFO's should be in jail. You can skew almost any number these days significantly with the right "Assumptions".
 
Antarius
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 6:00 pm

majano wrote:
Antarius wrote:
majano wrote:
I have already explained above why the original statement is not factually incorrect.


But it is. It's been explained by many above, including me.

They don't have 6.5 billion less of anything. They have whatever the market decided to do with that paper number.

This is a discussion of earnings. If you wish to hold a discussion of "the market" and "paper number", you are free to do so in a separate thread. Losses reduce equity, a simple accounting fact.


Just because this isn't a thread about the market doesn't mean incorrect understandings of write downs should be thrown around.

There is a poster who explained this very well above.
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Antarius
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 6:01 pm

ILNFlyer wrote:
Strato2 wrote:
Late 2023? That will make the 777X almost as late to the party as the 787. Inexcusable for a derivative aircraft. And what is the break even for the 777X with these new terrible numbers?


Much of this is due to customer demand impacted by the virus. It is not due to incompetence.


The virus is 1 year old. The delays predate it.

Some impact is due to the virus, for sure, but it cannot be chalked up entirely or largely to it.
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DenverTed
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 6:38 pm

If they are not going to deliver until late 2023, which really means the airlines were saying 2024, why not just shut down production for now? Although the 777-9s will look good stored in formation on the 'Christmas Tree' pads of the old SAC bases.
 
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Antaras
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 6:38 pm

Nomadd wrote:
I'm starting to save a lot of time by just looking for Stitch's comments when a lot of financial gobbledygook starts getting tossed around.
Is there any potential for improvements given the extra time? Maybe more mature engines?

A small buff in the MTOW seems potential.
If you disagree with my statement, assume that it was just a joke :duck:
 
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Stitch
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 6:39 pm

armagnac2010 wrote:
"firmware and hardware changes to the actuator control electronics" would tend to indicate a redesign of the flight control system.


This might be referring to the wing-folding mechanism. Boeing has noted that the test pilots found the original cockpit indicators and switches a bit unintuitive and Boeing made changes to them that makes it clear the current position and status of the wingtips during ground operations.
 
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Revelation
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 6:56 pm

Leeham's coverage at https://leehamnews.com/2021/01/27/im-su ... oeing-ceo/ is pretty interesting.

It's sad that aviation media members can't ask questions to Boeing execs directly, they have to resort to parsing TV appearances to get any info at all.

Calhoun expects the 777X will be a big money maker in the future.

Translation: Momma says her baby isn't ugly.

Calhoun said Boeing has sufficient liquidity for 2021. “So far, so good. I think we are beginning to feel better than we did.” The 87 will begin delivering this year, adding to liquidity.

A.net seems to be under-appreciating the fact that Boeing is making 5 787s per month and delivering zero 787s per month.

JP Morgan: Boeing had ~$11bn of inventory on the balance sheet for the 777X as of 3Q20, and we will seek to better understand what this means for the program. With a low-single-digit margin on 787 and a future charge possible, this charge highlights the degree to which the 737 MAX will be almost the sole contributor to GAAP EBIT at BCA.

Other than that, Mrs Lincoln, how was the play?
Wake up to find out that you are the eyes of the world
The heart has its beaches, its homeland and thoughts of its own
Wake now, discover that you are the song that the morning brings
The heart has its seasons, its evenings and songs of its own
 
Opus99
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 6:58 pm

Stitch wrote:
armagnac2010 wrote:
"firmware and hardware changes to the actuator control electronics" would tend to indicate a redesign of the flight control system.


This might be referring to the wing-folding mechanism. Boeing has noted that the test pilots found the original cockpit indicators and switches a bit unintuitive and Boeing made changes to them that makes it clear the current position and status of the wingtips during ground operations.

Yes Dominic gates has confirmed this in his latest article
 
DenverTed
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 7:08 pm

Going from break even to a 6.5 B charge is a big jump. A 3 year delay in income is maybe 2 B, maybe another .5B in certification costs. That leaves 4B. I'm guessing the accounting block went from 400 to 200, and that is 20 million per unit missing in margin or increased production costs for the lower rate.
 
Spetsnaz55
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 7:14 pm

Opus99 wrote:
Stitch wrote:
armagnac2010 wrote:
"firmware and hardware changes to the actuator control electronics" would tend to indicate a redesign of the flight control system.


This might be referring to the wing-folding mechanism. Boeing has noted that the test pilots found the original cockpit indicators and switches a bit unintuitive and Boeing made changes to them that makes it clear the current position and status of the wingtips during ground operations.

Yes Dominic gates has confirmed this in his latest article


He didn't confirm it, he's assuming.

But the whole wing and tail are new. So it's not just one new actuator versus 777 legacy
 
Opus99
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 7:17 pm

Spetsnaz55 wrote:
Opus99 wrote:
Stitch wrote:

This might be referring to the wing-folding mechanism. Boeing has noted that the test pilots found the original cockpit indicators and switches a bit unintuitive and Boeing made changes to them that makes it clear the current position and status of the wingtips during ground operations.

Yes Dominic gates has confirmed this in his latest article


He didn't confirm it, he's assuming.

But the whole wing and tail are new. So it's not just one new actuator versus 777 legacy

Sorry he assumed by elimination of other factors upon reading the details
 
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Revelation
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 7:28 pm

And, not a word on MAX10?
Wake up to find out that you are the eyes of the world
The heart has its beaches, its homeland and thoughts of its own
Wake now, discover that you are the song that the morning brings
The heart has its seasons, its evenings and songs of its own
 
Strato2
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 7:58 pm

Where did the thread on 6.5 billion charge for the 777X go? That is significant news that surely deserves it's own thread compared to let's say for example when QR CEO rants about the A380.
 
MIflyer12
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 8:18 pm

JonesNL wrote:
Ouch, will it be even available in numbers for the retirement cycle of the 777s?


That wouldn't be top on a list of worries. The best 772ER replacements are 787-9s or 787-10s, depending on how much range you need. -300ERs are still too young to be approaching end of service life.
 
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Stitch
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 8:47 pm

Strato2 wrote:
Where did the thread on 6.5 billion charge for the 777X go? That is significant news that surely deserves it's own thread compared to let's say for example when QR CEO rants about the A380.


It was merged into this thread.
 
Aircellist
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 10:30 pm

scbriml wrote:
Revelation wrote:
It means they can no longer project the sales needed to cover the $6.5B of expenses so they must take the write off. That's my understanding of how program accounting works.


The press release says:

https://boeing.mediaroom.com/2021-01-27 ... er-Results
"Commercial Airplanes now expects first delivery of the 777X to occur in late 2023 and has recorded a $6.5 billion reach-forward loss on the 777X program. Among the factors contributing to the revised first delivery schedule and reach-forward loss are an updated assessment of certification requirements based on ongoing communication with civil aviation authorities, an updated assessment of market demand based on continued dialogue with customers, resulting adjustments to production rates and the program accounting quantity, increased change incorporation costs, and associated customer and supply chain impacts."
(…)



Calhoun reminds me of that guy at Airbus who was certain that their big plane would be a money maker in the not so distant future… I actually am sorry for both.

That press release says fundamentally that the 777x is not wanted now and will not be wanted in numbers as large as was hoped for when the program was set up.

From that, the MAX and 787 woes, could Boeing become an acquisition target?
"When I find out I was wrong, I change my mind. What do you do?" -attributed to John Maynard Keynes
 
JonesNL
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 10:35 pm

Revelation wrote:
Leeham's coverage at https://leehamnews.com/2021/01/27/im-su ... oeing-ceo/ is pretty interesting.

It's sad that aviation media members can't ask questions to Boeing execs directly, they have to resort to parsing TV appearances to get any info at all.

Calhoun expects the 777X will be a big money maker in the future.

Translation: Momma says her baby isn't ugly.

Calhoun said Boeing has sufficient liquidity for 2021. “So far, so good. I think we are beginning to feel better than we did.” The 87 will begin delivering this year, adding to liquidity.

A.net seems to be under-appreciating the fact that Boeing is making 5 787s per month and delivering zero 787s per month.

JP Morgan: Boeing had ~$11bn of inventory on the balance sheet for the 777X as of 3Q20, and we will seek to better understand what this means for the program. With a low-single-digit margin on 787 and a future charge possible, this charge highlights the degree to which the 737 MAX will be almost the sole contributor to GAAP EBIT at BCA.

Other than that, Mrs Lincoln, how was the play?


I thought I had seen my share of striking wordings, but the last sentence really touched the point with surgical precision...
 
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PepeTheFrog
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 10:54 pm

Boeing also trims its production forecast:

Boeing has reduced the number of 777X it expects to produce over the life of that aircraft programme from 400 to 350 aircraft – a 12.5% cut.

The company made the adjustment to the number of units within its 777X “programme accounting” method, says Boeing chief financial officer Greg Smith on 27 January.

The reduced programme quantity is part of the reason why Boeing took a $6.5 billion 777X charge in the fourth quarter, Smith says. The charge also reflects the programme’s freshly delayed timeline. Boeing now predicts it will begin delivering 777-9s – the first 777X variant – in “late 2023”, not 2022, as previously projected.


https://www.flightglobal.com/airframers ... 58.article
Good moaning!
 
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zeke
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 11:06 pm

Calhoun said in his CNBC post earning interview that the 77X has a market of 1500 aircraft, it is my opinion that number is never going to be reached. It is my opinion that the further charges will be announced for the 77X as this target is not met.

Source CNBC https://youtu.be/53QrXHFaN70

The same 1500 number was stated by him in the Q4 earnings call.
“Don't be a show-off. Never be too proud to turn back. There are old pilots and bold pilots, but no old, bold pilots.” E. Hamilton Lee, 1949
 
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PepeTheFrog
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 11:12 pm

1500 aircraft is the size of the market over a period of 20 years, including other aircraft in the same category. Even Boeing knows it won't have the entire market for itself.

For now, the accounting block is 350 aircraft and who knows if they will produce more than that.
Good moaning!
 
iamlucky13
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Re: Boeing delays first 777-9 delivery to 2023, takes $6.5bn charge

Wed Jan 27, 2021 11:39 pm

Antarius wrote:
ILNFlyer wrote:
Strato2 wrote:
Late 2023? That will make the 777X almost as late to the party as the 787. Inexcusable for a derivative aircraft. And what is the break even for the 777X with these new terrible numbers?


Much of this is due to customer demand impacted by the virus. It is not due to incompetence.


The virus is 1 year old. The delays predate it.

Some impact is due to the virus, for sure, but it cannot be chalked up entirely or largely to it.


Compared to the original EIS target, you are correct, but let's just review the history in order to gain a sense of what factors drove how much change.

  • November 2013: Boeing launches the 777X, with first delivery planned for an unspecified part of 2020.
  • March 2016: Boeing is rumored to be trying to accelerate first delivery from planned 2020 to 2019.
  • October 2019: Due to GE's engine issues, first delivery pushed back from what had previously been summer of 2020 to the 1st half of 2021. This change was expected by this time.
  • December 2019: First cases of COVID-19 documented
  • January 2020: First flight (the history of other programs suggests EIS in roughly 16 months)
  • March 2020: COVID-19 related restrictions become widespread globally, including 4 week Boeing shutdown.
  • July 2020: First delivery pushed back to an unspecified part of 2022
  • January 2021: First delivery pushed back to late 2023

There's no specific dates given in any of this, but a mix of "early", "late", "summer" and "sometime" references to the years listed. Trying to boil that down to a more concrete, although assumed interpretation, I'll base my math on an original target of June 2020 and a current target of September 2023 (interpreting "late" as "2nd half" and taking the middle of that window).

So what drives the total delay of 39 months?

Again using my interpretations of the schedule statements, I assign 9 months of delay (from a 6-12 month range of reasonable interpretation of statements) to problems during design finalization, production of the first prototypes, and readiness of the engines. They flew at the start of 2020, compared to non-specific references to a prior target of 2019.

I assign 10 months to increased certification scrutiny stemming from the 737 MAX crashes, and design changes that may be driven by that scrutiny. I am only able to speculate on this, but the more modern design of the 777, the lack of an disclosure so far of major concerns identified, and the head start that the 777X team had since they've known for at least a year their work would be closely scrutinized leads me to expect a far shorter delay than the 20 month grounding of the MAX. I settle on half that.

That leaves me with 20 months to assign to customer negotiated deferral due to COVID-19. I was tempted to call part of these deferrals related to widebody oversupply, but although Emirates was already cutting their capacity plans prior to the pandemic, I think they still would have been willing to accept delivery in 2021. However, I remember thinking when the slide to 2021 was announced that it was probably a bit of a relief for Emirates.

In a sense, what I am assuming to be COVID-19 related customer deferrals could be viewed as a separate, parallel delay. Even if the plane had been certified in June 2020, the airlines couldn't really take it. International travel was down over 90%, and remains near that low. So in a way, it could be chalked up entirely to the virus, although I choose not to do so because it is still worthwhile to remember that Boeing and GE had development issues, and that Boeing has to deal with certification uncertainty they brought upon themselves.
 
ORDfan
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Re: Boeing 777X Testing/Production Thread - 2021

Wed Jan 27, 2021 11:46 pm

Anybody else expecting more 773 orders (or X conversions) as a result of this news?
 
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zeke
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 12:02 am

ORDfan wrote:
Anybody else expecting more 773 orders (or X conversions) as a result of this news?


No, and the production rate of 2 per month is so low it would suggest they are not selling additional slots.
“Don't be a show-off. Never be too proud to turn back. There are old pilots and bold pilots, but no old, bold pilots.” E. Hamilton Lee, 1949
 
Antarius
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 12:05 am

zeke wrote:
ORDfan wrote:
Anybody else expecting more 773 orders (or X conversions) as a result of this news?


No, and the production rate of 2 per month is so low it would suggest they are not selling additional slots.


I'm not sure that the production rate is low because they aren't selling additional slots. The production rate could very well be low because no one is buying right now. If BA walked up and placed an order for 50 frames, I suspect Boeing would be only to happy to fill it.
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zeke
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 12:24 am

Antarius wrote:

I'm not sure that the production rate is low because they aren't selling additional slots. The production rate could very well be low because no one is buying right now. If BA walked up and placed an order for 50 frames, I suspect Boeing would be only to happy to fill it.


Production lines are not a switch, some items are made well over over a year prior to final assembly.
“Don't be a show-off. Never be too proud to turn back. There are old pilots and bold pilots, but no old, bold pilots.” E. Hamilton Lee, 1949
 
iamlucky13
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 12:26 am

Stitch wrote:
Strato2 wrote:
Where did the thread on 6.5 billion charge for the 777X go? That is significant news that surely deserves it's own thread compared to let's say for example when QR CEO rants about the A380.


It was merged into this thread.


That's weird. Normally the moderators have to beg members not to bring discussion of topics like finances into the threads about testing and production. This time a separate thread was started about the financial topic and dragged into the testing and production thread.
 
Antarius
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 12:40 am

zeke wrote:
Antarius wrote:

I'm not sure that the production rate is low because they aren't selling additional slots. The production rate could very well be low because no one is buying right now. If BA walked up and placed an order for 50 frames, I suspect Boeing would be only to happy to fill it.


Production lines are not a switch, some items are made well over over a year prior to final assembly.


I'm aware of that. I didn't say or mean to imply that it could go from 2 to 12 tomorrow. But it could go from 2 to 3 or 4 in a shorter span of time if needed.
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tullamarine
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 2:29 am

ORDfan wrote:
Anybody else expecting more 773 orders (or X conversions) as a result of this news?

No, I'd be surprised if there were any airlines considering a purchase of large aircraft this calendar year until they see what happens with the vaccination rollout and ,by extension, the pandemic. All airlines currently have most of their long-range capacity parked so they do not need to buy extra capacity when demand comes back. Even when they do, they can be pretty confident that they won't have a lot of competition for production slots.
717, 721/2, 732/3/4/5/7/8/9, 742/3/4, 752/3, 762/3, 772/E/W, 788/9, 300,310, 319,320/1, 332/3, 359, 388, DC9, DC10, F28, F100, 142,143, E75/90, CR2, D82/3/4, SF3, ATR
 
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MrBren
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 8:21 am

I personaly think the 77X will be an industrial crash. Too big, too late.
 
Opus99
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 8:27 am

MrBren wrote:
I personaly think the 77X will be an industrial crash. Too big, too late.

Do you have anything else to add?
 
kurtverbose
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 1:45 pm

The 777x was always a bad idea. It was too big. It was only able to compete because of new engines. An update of the A350 engines would make the 777x a modern day A340-600.

It's cost them almost as much as a new aircraft now, and I think they will struggle to sell more than 300.

It would have been much better for Boeing to extend the capabilities of the 787.
 
morrisond
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 3:00 pm

kurtverbose wrote:
The 777x was always a bad idea. It was too big. It was only able to compete because of new engines. An update of the A350 engines would make the 777x a modern day A340-600.

It's cost them almost as much as a new aircraft now, and I think they will struggle to sell more than 300.

It would have been much better for Boeing to extend the capabilities of the 787.


Agreed - that was my argument and many others back when they decided to launch 777X. It's now looking like that would have been a very wise decision and probably a smaller capital outlay as well. I think 777X was subject to design creep and ended up being a lot more extensive upgrade than first envisioned - but they had too to make it better than A350.

Plus evolutions of the 787 probably would have weighed a lot less than 777X for the same capability making it more efficient. The 787-11/12 were really good ideas.
 
frmrCapCadet
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 3:24 pm

"Where this becomes a problem for analysts is the impact on FUTURE cash flows:"

Extra money or resources can be used to buy gold. Assume no bandits, Huns or Goths come and take it away
Put it in a bank, and pray no bank failures (or government insures deposits)
Buy bonds and hope the company does not fail
Buy stocks - the only value is usually whatever the company earns in the future. Most bankruptcies wipe out stock holders

Point being, stock is worth what ever the company is doing to keep on earning money and remain a viable business. Predicting the future is hard, but carefully buying stocks is also about the best way of preserving and increasing the value of whatever someone can do with present excess money. Financial statements include present facts and figures, but of necessity are mostly predictions about the future.

Financial statements all are, in a sense, carefully assembled fictions, which indicate what will happen in the future. Good management, good products, and a healthy economy in whatever sector the company operates - it all becomes true and everyone makes money. But ....
Buffet: the airline business...has eaten up capital...like..no other (business)
 
JonesNL
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 3:53 pm

morrisond wrote:
kurtverbose wrote:
The 777x was always a bad idea. It was too big. It was only able to compete because of new engines. An update of the A350 engines would make the 777x a modern day A340-600.

It's cost them almost as much as a new aircraft now, and I think they will struggle to sell more than 300.

It would have been much better for Boeing to extend the capabilities of the 787.


Agreed - that was my argument and many others back when they decided to launch 777X. It's now looking like that would have been a very wise decision and probably a smaller capital outlay as well. I think 777X was subject to design creep and ended up being a lot more extensive upgrade than first envisioned - but they had too to make it better than A350.

Plus evolutions of the 787 probably would have weighed a lot less than 777X for the same capability making it more efficient. The 787-11/12 were really good ideas.


Agreed, the window of sales keeps closing down on the 777x. An Neo of the 787 and A350 in 2030 will easily beat the 777x on most metrics. If it had been launched in 2018/19 it would have 10-12 years to sell, but now the window is just 2-3 years, with an scenario where recovery of widebody flights in 2025. Airlines ordering widebodies again in 2027...
 
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Revelation
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 3:56 pm

I smell a wiff of revisionism here.

I don't think 77X was a mistake in 2013. 77W had a strong and loyal following. A380 was fundamentally inefficient and not getting follow up orders. 779 is a more efficient 77W with a minor two row stretch. Cost and risk was small compared to a clean sheet. It had a lot of cockpit and maintenance compatibility with 777 and 787. The order book shows it was being accepted by most of the blue chip airlines.

77X is not a "swing for the fences" move in terms of development cost and market strategy like A380 was. We see the write off is $6.5B, most sources suggest A380 is 3x-4x that cost. If 779 is no more a market strategy mistake than A350-1000 is.

The alternative would have been for Boeing to have done a clean sheet Y3 launched in 2013 that would be a 10-across 772/773/stretch platform with similar wings and engines to what the X has and presumably a CFRP fuse otherwise you'd just do the X. It would have meant rebooting the FAL and the whole supply chain and setting a much higher regulatory burden to clear. It probably would have cost >2x-3x the $6.5B we just saw written off. It would have just as many delays as X has, presumably more. Right now it would be sucking money out of the company and the supply chain at a much higher rate than X is with no prospect of income for years.

The only advantage to a clean sheet is it may have been better positioned to blunt the success of A359, but doing that in a true 10x form factor is a big ask. The end result may have been akin to A358, a shrink that didn't sell. I think Boeing was OK with letting the 787 attack A359 from below and 77X attack from above.

The main question to ask is why didn't Boeing spend MORE on 77X so it was ready sooner. I presume this was because they were taking the wing tech back in house after sending it to Japan for the 787 and wanted/needed time to get that right. Yet the end result of getting it onto the market sooner wouldn't be much different than now. They may have had the first batch delivered before COVID struck but airlines would be asking for deferrals just like they are now.
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 4:07 pm

JonesNL wrote:
Agreed, the window of sales keeps closing down on the 777x. An Neo of the 787 and A350 in 2030 will easily beat the 777x on most metrics. If it had been launched in 2018/19 it would have 10-12 years to sell, but now the window is just 2-3 years, with an scenario where recovery of widebody flights in 2025. Airlines ordering widebodies again in 2027...

I think the NEO of 2030 is shifting right just as fast as 77X is. GE, RR and PW have a huge hole in their finances. All will need strong positive cash flows to fill that hole. None will want to be disruptive for quite a while, IMO. We can speculate on what the recovery will be and when, but till it's in the rear view mirror we won't see the desire to be disruptive. Personally I think the post-covid market will be smaller than the pre-covid market so IMO the holes will take longer to fill.
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JonesNL
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 4:41 pm

Revelation wrote:
JonesNL wrote:
Agreed, the window of sales keeps closing down on the 777x. An Neo of the 787 and A350 in 2030 will easily beat the 777x on most metrics. If it had been launched in 2018/19 it would have 10-12 years to sell, but now the window is just 2-3 years, with an scenario where recovery of widebody flights in 2025. Airlines ordering widebodies again in 2027...

I think the NEO of 2030 is shifting right just as fast as 77X is. GE, RR and PW have a huge hole in their finances. All will need strong positive cash flows to fill that hole. None will want to be disruptive for quite a while, IMO. We can speculate on what the recovery will be and when, but till it's in the rear view mirror we won't see the desire to be disruptive. Personally I think the post-covid market will be smaller than the pre-covid market so IMO the holes will take longer to fill.


2030 was based on 5 years delay, seeing earlier comments of Ultrafan introduction mid decade. I agree that engine oems need to see a lot of orders/money before committing.
 
morrisond
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 5:11 pm

Revelation wrote:
I smell a wiff of revisionism here.

I don't think 77X was a mistake in 2013. 77W had a strong and loyal following. A380 was fundamentally inefficient and not getting follow up orders. 779 is a more efficient 77W with a minor two row stretch. Cost and risk was small compared to a clean sheet. It had a lot of cockpit and maintenance compatibility with 777 and 787. The order book shows it was being accepted by most of the blue chip airlines.

77X is not a "swing for the fences" move in terms of development cost and market strategy like A380 was. We see the write off is $6.5B, most sources suggest A380 is 3x-4x that cost. If 779 is no more a market strategy mistake than A350-1000 is.

The alternative would have been for Boeing to have done a clean sheet Y3 launched in 2013 that would be a 10-across 772/773/stretch platform with similar wings and engines to what the X has and presumably a CFRP fuse otherwise you'd just do the X. It would have meant rebooting the FAL and the whole supply chain and setting a much higher regulatory burden to clear. It probably would have cost >2x-3x the $6.5B we just saw written off. It would have just as many delays as X has, presumably more. Right now it would be sucking money out of the company and the supply chain at a much higher rate than X is with no prospect of income for years.

The only advantage to a clean sheet is it may have been better positioned to blunt the success of A359, but doing that in a true 10x form factor is a big ask. The end result may have been akin to A358, a shrink that didn't sell. I think Boeing was OK with letting the 787 attack A359 from below and 77X attack from above.

The main question to ask is why didn't Boeing spend MORE on 77X so it was ready sooner. I presume this was because they were taking the wing tech back in house after sending it to Japan for the 787 and wanted/needed time to get that right. Yet the end result of getting it onto the market sooner wouldn't be much different than now. They may have had the first batch delivered before COVID struck but airlines would be asking for deferrals just like they are now.


No revision on my part. I was talking about a stretch/new wing on the 787 not a clean sheet vs 777x.

From Post 24 in this thread from 2012 viewtopic.php?f=3&t=542349&p=7492769&hilit=787+11#p7492769

"That sure does sound like a really expensive re-do.

Wouldn't a 260' Long 787- 11x seat just as many as a 250' long 777-9X and have more Cargo room?

I'm guessing it should weigh a lot less than a 777-9x, meaning a 65m wing would be fine making it fit in Existing Code E gates.

It would require a new center section/wing (30' longer in length) and longer front landing gear. Basically use the front and rear sections from the 787-10 and just redo the center. As it is longer I would guess the Tail size should be okay.

They just spent billions on the new 787 systems and manufacturing process - why not build further on that work rather than reinventing the 777 at great cost.

This seems to me to be the better option and I can't see it gaining 200,000 lbs (difference in weight between 787-9/10 and 777-9x) be stretching it 30', so it should have a lower thrust requirement(85-90,000lbs which there are some great options available or will be available) and be better on fuel than the 777-9x.

By 2019 they should be able to crank out a lot of 787's from there 3 FAL's, convert the 777 line once production ends and you could have close to single aisle output.

What am I missing? Wouldn't this be cheaper to develop than what they are envisioning?"


This would have been cheaper than 777X as they have essentially redone a lot of the systems on the 777x anyways adapting 787 tech - 777X has new gear - new/wingbox.

The 787-11/12 would have kept the same Cockpit and systems just new wing/tail gear/engines.
 
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 5:17 pm

JonesNL wrote:
2030 was based on 5 years delay, seeing earlier comments of Ultrafan introduction mid decade. I agree that engine oems need to see a lot of orders/money before committing.

A 2025 UF became unrealistic once RR had to shift cash and engineering resources into addressing the T1000 blade cracking issues. Add COVID's impact in general and it's particularly negative impact on the wide body market and we get even more slippage. The only kindness RR has going for it is FAA crawling up Boeing's back side in the post-MCAS world which is keeping GE9X sitting on the loading dock.

RR has done a lot of downsizing and reorganizing in recent months. It seems to me eventual productization of UF will be a "bet the business" move, yet we now read it too will be put on ice once testing is done so it's hard to see anything but several lean years coming for them. I will say of the big three engine makers they will have the most desire to be disruptive. It'll be interesting to watch to see exactly when they find the conditions necessary to put UF on to a production platform.
Wake up to find out that you are the eyes of the world
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ssteve
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 5:21 pm

morrisond wrote:
By 2019 they should be able to crank out a lot of 787's from there 3 FAL's, convert the 777 line once production ends and you could have close to single aisle output.

What am I missing? Wouldn't this be cheaper to develop than what they are envisioning?"


Are you saying it would have made sense to be only producing 787 passenger derivatives by 2021 (albeit with a new triple-stretch that you propose)? Wouldn't have worked out well. They are closing the 787 line in Everett, not opening new ones.
 
Opus99
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 5:24 pm

morrisond wrote:
Revelation wrote:
I smell a wiff of revisionism here.

I don't think 77X was a mistake in 2013. 77W had a strong and loyal following. A380 was fundamentally inefficient and not getting follow up orders. 779 is a more efficient 77W with a minor two row stretch. Cost and risk was small compared to a clean sheet. It had a lot of cockpit and maintenance compatibility with 777 and 787. The order book shows it was being accepted by most of the blue chip airlines.

77X is not a "swing for the fences" move in terms of development cost and market strategy like A380 was. We see the write off is $6.5B, most sources suggest A380 is 3x-4x that cost. If 779 is no more a market strategy mistake than A350-1000 is.

The alternative would have been for Boeing to have done a clean sheet Y3 launched in 2013 that would be a 10-across 772/773/stretch platform with similar wings and engines to what the X has and presumably a CFRP fuse otherwise you'd just do the X. It would have meant rebooting the FAL and the whole supply chain and setting a much higher regulatory burden to clear. It probably would have cost >2x-3x the $6.5B we just saw written off. It would have just as many delays as X has, presumably more. Right now it would be sucking money out of the company and the supply chain at a much higher rate than X is with no prospect of income for years.

The only advantage to a clean sheet is it may have been better positioned to blunt the success of A359, but doing that in a true 10x form factor is a big ask. The end result may have been akin to A358, a shrink that didn't sell. I think Boeing was OK with letting the 787 attack A359 from below and 77X attack from above.

The main question to ask is why didn't Boeing spend MORE on 77X so it was ready sooner. I presume this was because they were taking the wing tech back in house after sending it to Japan for the 787 and wanted/needed time to get that right. Yet the end result of getting it onto the market sooner wouldn't be much different than now. They may have had the first batch delivered before COVID struck but airlines would be asking for deferrals just like they are now.


No revision on my part. I was talking about a stretch/new wing on the 787 not a clean sheet vs 777x.

From Post 24 in this thread from 2012 viewtopic.php?f=3&t=542349&p=7492769&hilit=787+11#p7492769

"That sure does sound like a really expensive re-do.

Wouldn't a 260' Long 787- 11x seat just as many as a 250' long 777-9X and have more Cargo room?

I'm guessing it should weigh a lot less than a 777-9x, meaning a 65m wing would be fine making it fit in Existing Code E gates.

It would require a new center section/wing (30' longer in length) and longer front landing gear. Basically use the front and rear sections from the 787-10 and just redo the center. As it is longer I would guess the Tail size should be okay.

They just spent billions on the new 787 systems and manufacturing process - why not build further on that work rather than reinventing the 777 at great cost.

This seems to me to be the better option and I can't see it gaining 200,000 lbs (difference in weight between 787-9/10 and 777-9x) be stretching it 30', so it should have a lower thrust requirement(85-90,000lbs which there are some great options available or will be available) and be better on fuel than the 777-9x.

By 2019 they should be able to crank out a lot of 787's from there 3 FAL's, convert the 777 line once production ends and you could have close to single aisle output.

What am I missing? Wouldn't this be cheaper to develop than what they are envisioning?"


This would have been cheaper than 777X as they have essentially redone a lot of the systems on the 777x anyways adapting 787 tech - 777X has new gear - new/wingbox.

The 787-11/12 would have kept the same Cockpit and systems just new wing/tail gear/engines.

also remember airlines at the time probably wont have wanted that, they LOVED/LOVE the 300ER and wanted it based on that platform because of the reliability etc. 2013, 787 was still not a reliable jet, no where near the 777, even today
 
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Revelation
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 5:30 pm

morrisond wrote:
This would have been cheaper than 777X as they have essentially redone a lot of the systems on the 777x anyways adapting 787 tech - 777X has new gear - new/wingbox.

The 787-11/12 would have kept the same Cockpit and systems just new wing/tail gear/engines.

I think what you are missing is in 2013 the deep wounds of 787 EIS had not yet healed, both within Boeing and within the customer base.

Boeing still needed to roll out the improvements in manufacturing and commonality between the models that we saw later in the decade, and in general let the product become more mature.

I don't think 777 customers would have been comfortable in trusting their future to a bigger 787 in that time frame.

What we ended up seeing was a lot of blue chip airlines betting on a 77W stretch with new wing and engines.

Unfortunately it seems Boeing did not fast-track it, and IMO GE's "durability issue" really cost the program big time.
Wake up to find out that you are the eyes of the world
The heart has its beaches, its homeland and thoughts of its own
Wake now, discover that you are the song that the morning brings
The heart has its seasons, its evenings and songs of its own
 
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Stitch
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 5:40 pm

kurtverbose wrote:
The 777x was always a bad idea. It was too big.


It wasn't big enough, frankly. It needs every seat it can pack in to offset it's heavier structure. It should have been an 80m frame from the get-go and Boeing seems to be realizing this now that they are starting to consider an 80m 777-10X.

kurtverbose wrote:
It was only able to compete because of new engines. An update of the A350 engines would make the 777x a modern day A340-600.


Well the A340-600 had four strikes against it - it was heavier than the 777-300ER, it had less seats than the 777-300ER and it had four engines that both burned more fuel (in total) and were more expensive to maintain. Airbus considered hanging new engines off it to address one of the strikes, but it still had the other three.

The 777X currently has one strike - it's heavier than the A350-1000.

kurtverbose wrote:
It would have been much better for Boeing to extend the capabilities of the 787.


As wonderful as CFRP is said to be, stretching it to the projected 787-11 and 787-12 lengths might have penalized it with significant extra weight - just like the A340-500 and A340-600 stretches did to the A340-300. New wings would have been a given, likely with a span similar to the 777X with folding wingtips. And new undercarriage would have had needed to be developed to support both the higher operating weights and to raise the airframe off the ground to allow the fitting of the GEnx and/or Trent XWB. All of that would have driven up the structural weight, as well.

So it could have ended up being the 787 stretches were also more heavier than the A350-1000 and might have been as heavy or heavier than the 777X.
 
Opus99
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 5:49 pm

Let’s see how the replacement for the 300ER market unfolds. But calling it an a380 is understandable but also not true. Holding off on the jet is the best thing to do right now. It will have its time (especially if it is as good as we expect it to be)
 
Opus99
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 5:53 pm

Revelation wrote:
morrisond wrote:
This would have been cheaper than 777X as they have essentially redone a lot of the systems on the 777x anyways adapting 787 tech - 777X has new gear - new/wingbox.

The 787-11/12 would have kept the same Cockpit and systems just new wing/tail gear/engines.

I think what you are missing is in 2013 the deep wounds of 787 EIS had not yet healed, both within Boeing and within the customer base.

Boeing still needed to roll out the improvements in manufacturing and commonality between the models that we saw later in the decade, and in general let the product become more mature.

I don't think 777 customers would have been comfortable in trusting their future to a bigger 787 in that time frame.

What we ended up seeing was a lot of blue chip airlines betting on a 77W stretch with new wing and engines.

Unfortunately it seems Boeing did not fast-track it, and IMO GE's "durability issue" really cost the program big time.

To be fair to GE, if the jet took off in 2019 that was about 7 months earlier than it did. FAA and EASA would’ve still put heavy restraints on it till they finished the Max and made changes to the certification process and then Covid. We would still be hanging in the balance of certification
 
Opus99
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 6:08 pm

Question from me. So if boeing has to redesign the actuator that doesn’t that make the tests they’ve done so far invalidated? Especially on stability and control
 
morrisond
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 6:09 pm

ssteve wrote:
morrisond wrote:
By 2019 they should be able to crank out a lot of 787's from there 3 FAL's, convert the 777 line once production ends and you could have close to single aisle output.

What am I missing? Wouldn't this be cheaper to develop than what they are envisioning?"


Are you saying it would have made sense to be only producing 787 passenger derivatives by 2021 (albeit with a new triple-stretch that you propose)? Wouldn't have worked out well. They are closing the 787 line in Everett, not opening new ones.


Yes - just 787 Derivatives as their only only WB product. That is what I (and others) were proposing back in 2012.

If the 787-11/12 was available now - and it could have been as it should have taken less time than 777x as not as much systems work - the Everett line could still be open - or less likely that it be consolidated down to 1. Although given COVID that would make SC pretty efficient with only 1.

For the rest of you stating why Boeing wouldn't have done this in 2012 - you can whine all you want - but in Hindsight given how much more mature the 787 it would have been the right decision.

It is not revisionist history. I and others were right to think that this was the best course of action.
 
Aircellist
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 6:18 pm

The 777X is not (quite) the A380, yet one thing has to give: either Boeing was absolutely right (and I believe they were) in foreseeing market fragmentation, or they were absolutely right (and I believe they were not) in making the next biggest plane. For the record, I believe the A350 itself is leaning on the "too big" side as well.

Bigger planes and flight consolidation would have been a more efficient solution, but it was the '60s and '70's solution. Airlines have rushed to the shuttle-like model for about every connexion that could warrant it… at the time when lots of people flew.

Just to say that in today's world, and nobody knows how long "todays's world" will last, all that is moot because flying en masse is so 2019…
"When I find out I was wrong, I change my mind. What do you do?" -attributed to John Maynard Keynes
 
Opus99
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Re: Boeing 777X Testing/Production Thread - 2021

Thu Jan 28, 2021 6:19 pm

morrisond wrote:
ssteve wrote:
morrisond wrote:
By 2019 they should be able to crank out a lot of 787's from there 3 FAL's, convert the 777 line once production ends and you could have close to single aisle output.

What am I missing? Wouldn't this be cheaper to develop than what they are envisioning?"


Are you saying it would have made sense to be only producing 787 passenger derivatives by 2021 (albeit with a new triple-stretch that you propose)? Wouldn't have worked out well. They are closing the 787 line in Everett, not opening new ones.


Yes - just 787 Derivatives as their only only WB product. That is what I (and others) were proposing back in 2012.

If the 787-11/12 was available now - and it could have been as it should have taken less time than 777x as not as much systems work - the Everett line could still be open - or less likely that it be consolidated down to 1. Although given COVID that would make SC pretty efficient with only 1.

For the rest of you stating why Boeing wouldn't have done this in 2012 - you can whine all you want - but in Hindsight given how much more mature the 787 it would have been the right decision.

It is not revisionist history. I and others were right to think that this was the best course of action.

Except we don't have the gift of hindsight at our disposal when decisions are made. also there's absolutely no guarantee that product would've been on time. the -10 only came out in 2017. it would've probably been somewhat different to the currently line of 787s, much higher MTOW, six wheel config on the main landing gear, different wing profile for a jet that they hadn't even fully optimised at the time? would it have used the current GEnX? or a new engine? how much will the weight savings be when you begin to stretch out like that. How would it fair against the -1000? would the gain over the 1000 have been enough? there are too many factors that played against such a decision.
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