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Flying-Tiger
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ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 12:41 pm

ALC has openly told Boeing to get their house in order before they are willing to talk about any new project:

“We want Boeing to … get its house right, to get its house in order. The 787 delays are impacting us, as well as the rest of the delivery, the manufacturing process. Boeing has gone through a tremendously difficult time and while they certainly have made a lot of progress, the blunt truth is we need them to fix the remainder of their house first before we have any interest in talking about new aircraft.”


https://simpleflying.com/alc-boeing-787-issues/

That´s unusual harsh words for a lessor or any client at all. Further in the article it´s going in more fine details, and it includes a warning that 787 are at risk due to the delays (past 12 month delay threshold).

Appears that their patience is coming to an end, especially as there seems to be no proper way forward how to end the issues.
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Exeiowa
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 3:27 pm

That's quite the article, seems weird that complaints about lack of delivery during a time of low demand. The problems as specified in the article stems from not accepting finished planes due to being out of specification. The nature of the problem look like something not easily fixed, so I think this is mostly an attempt to use media to negotiate a reduction in cost to accept the out of spec planes, but Boeing does not seem to want to budge and if they do not resolve this eventually ALC will walk away. Then Boeing will be stuck with out of spec white tails that they will really take a hit on.
 
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Cyrus
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 5:02 pm

I hope one day A.net can set up rule to prevent us to discussing crap from simpleflying!
 
airboeingbus
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 6:07 pm

Cyrus wrote:
I hope one day A.net can set up rule to prevent us to discussing crap from simpleflying!


It's not really crap when it's a direct quote from the CEO of ALC (one of the biggest leasing companies in the world).
 
iamlucky13
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 7:20 pm

My view has been the big delays in 787 deliveries actually are about Boeing getting their house in order. I'm not quite clear how long this has been an issue, but the impression I got from previous reporting is they previously had looked at each issue in isolation, and determined they were acceptable, but for undisclosed reasons decided to look at it more expansively, and realized the combined condition is a concern.

So when Calhoun said at the earnings call (some commentary of mine in parenthesis):

Well, there won't be a formal sign-off in that regard (from the FAA. Boeing still has delegated authority for 787 airworthiness certificates?). But, without a doubt, we will make sure the FAA is comfortable with every act we've taken. And I'll only add the comment that this expansion of inspection and quality assurance and all those things, maybe I'll take a hit on that one (I think he is saying they are uncertain whether this level of inspection and delay is necessary, but they made the call to delay anyways). But this is a moment where we get to fix some things and do some things the way we would like to do them.

And so I have put very little pressure on production and engineering team to resolve things too quickly. I want it to be thorough and done, and I want to prevent future rework around this stuff.


I'm hopeful that this is an example of taking a step back and re-evaluating if there are any potential concerns they can take a closer look at and proactively resolve even if it's not clear whether it is a problem, to ensure it does not become a problem later.

As for ALC's comment, I found it refreshing, at least to the degree it suggests that some airlines actually do want widebody deliveries right now.
 
WayexTDI
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 7:44 pm

Cyrus wrote:
I hope one day A.net can set up rule to prevent us to discussing crap from simpleflying!

Maybe FlightGlobal is a better source?
 
ytib
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 7:54 pm

Cyrus wrote:
I hope one day A.net can set up rule to prevent us to discussing crap from simpleflying!


From the earnings call for ALC in response to a question from Jamie Baker.

"John L. Plueger, Air Lease Corporation - CEO, President & Director [48] -------------------------------------------------------------------------------- Jamie, let me just add, you specifically asked what does Air Lease want Boeing to do? Let me give you a very specific answer. We want Boeing to continue to make -- to get its house right, to get its house in order. These 787 delays are impacting us as well as the rest of the delivery, the manufacturing process. Boeing has gone through a tremendously difficult time. And while they certainly have made a lot of progress, the blunt truth is we need them to fix the remainder of their house first before we have any interest in talking about new aircraft."
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sxf24
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 7:59 pm

I don’t think Boeing would disagree: they’re not going to work on a new airplane until deliveries of existing products is stabilized.
 
rigo
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 8:53 pm

sxf24 wrote:
I don’t think Boeing would disagree: they’re not going to work on a new airplane until deliveries of existing products is stabilized.


Did they mean new airplane models, or simply new ALC orders?
 
tomcat
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 9:35 pm

rigo wrote:
sxf24 wrote:
I don’t think Boeing would disagree: they’re not going to work on a new airplane until deliveries of existing products is stabilized.


Did they mean new airplane models, or simply new ALC orders?


They meant new airplane models. They were replying to a question about what Boeing should do in the single-aisle market and in the middle-of-the-market.

Here is the full transcript of the ALC conference call:
https://finance.yahoo.com/news/edited-transcript-al-n-earnings-213000964.html
 
Opus99
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 9:54 pm

iamlucky13 wrote:
My view has been the big delays in 787 deliveries actually are about Boeing getting their house in order. I'm not quite clear how long this has been an issue, but the impression I got from previous reporting is they previously had looked at each issue in isolation, and determined they were acceptable, but for undisclosed reasons decided to look at it more expansively, and realized the combined condition is a concern.

So when Calhoun said at the earnings call (some commentary of mine in parenthesis):

Well, there won't be a formal sign-off in that regard (from the FAA. Boeing still has delegated authority for 787 airworthiness certificates?). But, without a doubt, we will make sure the FAA is comfortable with every act we've taken. And I'll only add the comment that this expansion of inspection and quality assurance and all those things, maybe I'll take a hit on that one (I think he is saying they are uncertain whether this level of inspection and delay is necessary, but they made the call to delay anyways). But this is a moment where we get to fix some things and do some things the way we would like to do them.

And so I have put very little pressure on production and engineering team to resolve things too quickly. I want it to be thorough and done, and I want to prevent future rework around this stuff.


I'm hopeful that this is an example of taking a step back and re-evaluating if there are any potential concerns they can take a closer look at and proactively resolve even if it's not clear whether it is a problem, to ensure it does not become a problem later.

As for ALC's comment, I found it refreshing, at least to the degree it suggests that some airlines actually do want widebody deliveries right now.

Yh i agree
 
rigo
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 10:17 pm

tomcat wrote:
rigo wrote:
sxf24 wrote:
I don’t think Boeing would disagree: they’re not going to work on a new airplane until deliveries of existing products is stabilized.


Did they mean new airplane models, or simply new ALC orders?


They meant new airplane models. They were replying to a question about what Boeing should do in the single-aisle market and in the middle-of-the-market.

Here is the full transcript of the ALC conference call:
https://finance.yahoo.com/news/edited-transcript-al-n-earnings-213000964.html


Not to hijack the thread but that's a really interesting question by itself. With the MAX crisis Boeing sure has let Airbus get ahead in those markets. I can't see them immediately start developing a direct 737MAX successor so they will either have to revive the NMA and attack the A321XLR from above, or address the A220.
 
Lootess
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 10:25 pm

You'd think it'd be Qatar's AAB saying this, but kudos to ALC.
 
TTailedTiger
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 10:50 pm

What exactly is he talking about? Has Boeing not lived up to the contract and paid any penalties for late deliveries? If Boeing is holding up to their agreement then he has no right to spew such nonsense. Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence. But there's plenty of evidence of horrible workmanship coming out of Washington State with the 767 tanker.
 
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scbriml
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 11:05 pm

TTailedTiger wrote:
What exactly is he talking about?


Did you read the Flight Global article? Seems very clear - Boeing hasn't delivered a 787 in nearly four months in order to fix "production issues".
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WayexTDI
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 11:09 pm

TTailedTiger wrote:
What exactly is he talking about? Has Boeing not lived up to the contract and paid any penalties for late deliveries? If Boeing is holding up to their agreement then he has no right to spew such nonsense. Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence. But there's plenty of evidence of horrible workmanship coming out of Washington State with the 767 tanker.

Even if a supplier has lived up to its agreement by providing penalties for late deliveries, would you order again from said supplier?

Imagine a big pharma flight department, they have a contract with an FBO that their plane will be fueled and ready within 60 minutes of calling (feel free to modify the numbers as needed). Now, for the past 2 or 3 visits to that FBO, they were late by, say 2-3 hours every time; the FBO agree to pay penalties, as specified in the contract. However, those delays made the big pharma CEO that flew in that jet late to his meetings and almost lose multi-billion dollar contracts; he's so mad he's ready to fire every body in his flight department. Wouldn't he be right to request cancellation of the contract and go find another FBO?
 
Opus99
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Re: ALC tells Boeing "to get house in order"

Tue Feb 23, 2021 11:14 pm

TTailedTiger wrote:
What exactly is he talking about? Has Boeing not lived up to the contract and paid any penalties for late deliveries? If Boeing is holding up to their agreement then he has no right to spew such nonsense. Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence. But there's plenty of evidence of horrible workmanship coming out of Washington State with the 767 tanker.

I think he’s a bit in the right here. I would be pissed off. Especially in this time if you actually have customers that want to take the jet.
 
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zeke
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 2:59 am

TTailedTiger wrote:
Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence.


Boeing themselves grounded aircraft from that factory last year, we had a thread on here about it.

viewtopic.php?t=1451003&start=150

I would suggest Boeing would have had due cause (evidence) to ground them.

Fair use excerpt

“ (Bloomberg) — Boeing Co. grounded eight of its 787 Dreamliner jets for inspection and repair after finding two manufacturing flaws that together could compromise the structural integrity of the aircraft.

The distinct issues involve the composite barrel sections at the rear of the widebody plane, which are melded together at a Boeing plant in South Carolina. Together, the flaws cause the fuselage sections to fall short of the planemaker’s standards for withstanding stress, creating a risk of in-flight failure.”

Full article available here https://www.seattletimes.com/business/b ... eamliners/
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FlyingElvii
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 4:46 am

iamlucky13 wrote:
My view has been the big delays in 787 deliveries actually are about Boeing getting their house in order. I'm not quite clear how long this has been an issue, but the impression I got from previous reporting is they previously had looked at each issue in isolation, and determined they were acceptable, but for undisclosed reasons decided to look at it more expansively, and realized the combined condition is a concern.

So when Calhoun said at the earnings call (some commentary of mine in parenthesis):

Well, there won't be a formal sign-off in that regard (from the FAA. Boeing still has delegated authority for 787 airworthiness certificates?). But, without a doubt, we will make sure the FAA is comfortable with every act we've taken. And I'll only add the comment that this expansion of inspection and quality assurance and all those things, maybe I'll take a hit on that one (I think he is saying they are uncertain whether this level of inspection and delay is necessary, but they made the call to delay anyways). But this is a moment where we get to fix some things and do some things the way we would like to do them.

And so I have put very little pressure on production and engineering team to resolve things too quickly. I want it to be thorough and done, and I want to prevent future rework around this stuff.


I'm hopeful that this is an example of taking a step back and re-evaluating if there are any potential concerns they can take a closer look at and proactively resolve even if it's not clear whether it is a problem, to ensure it does not become a problem later.

As for ALC's comment, I found it refreshing, at least to the degree it suggests that some airlines actually do want widebody deliveries right now.

How much of these inspection items, if any, are quality issues due to the international sourcing of components and structures?
 
kalvado
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 12:32 pm

FlyingElvii wrote:
iamlucky13 wrote:
My view has been the big delays in 787 deliveries actually are about Boeing getting their house in order. I'm not quite clear how long this has been an issue, but the impression I got from previous reporting is they previously had looked at each issue in isolation, and determined they were acceptable, but for undisclosed reasons decided to look at it more expansively, and realized the combined condition is a concern.

So when Calhoun said at the earnings call (some commentary of mine in parenthesis):

Well, there won't be a formal sign-off in that regard (from the FAA. Boeing still has delegated authority for 787 airworthiness certificates?). But, without a doubt, we will make sure the FAA is comfortable with every act we've taken. And I'll only add the comment that this expansion of inspection and quality assurance and all those things, maybe I'll take a hit on that one (I think he is saying they are uncertain whether this level of inspection and delay is necessary, but they made the call to delay anyways). But this is a moment where we get to fix some things and do some things the way we would like to do them.

And so I have put very little pressure on production and engineering team to resolve things too quickly. I want it to be thorough and done, and I want to prevent future rework around this stuff.


I'm hopeful that this is an example of taking a step back and re-evaluating if there are any potential concerns they can take a closer look at and proactively resolve even if it's not clear whether it is a problem, to ensure it does not become a problem later.

As for ALC's comment, I found it refreshing, at least to the degree it suggests that some airlines actually do want widebody deliveries right now.

How much of these inspection items, if any, are quality issues due to the international sourcing of components and structures?

A broader answer is that at least some of Boeing problems are due to lack of internal communication. Which occured even within the same building - max saga, including technical pilots vs test pilots not talking to each other. Adding an ocean and a few hours of time difference between groups cannot help the case.
 
LCDFlight
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 12:57 pm

All of this was predicted when Boeing stopped respecting engineering project management and the manufacturing process.

People without even basic respect or knowledge of these processes were put in charge of Boeing, based on a vacuous "streamlining" premise. Where important parts of these processs are skipped to save time and money. It is extremely important to record that, in terms of time and money, these people's ideas totally, epically failed. Their business philosophy was groundless and without any merit. And they also caused deaths.
 
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Revelation
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 1:57 pm

Opus99 wrote:
TTailedTiger wrote:
What exactly is he talking about? Has Boeing not lived up to the contract and paid any penalties for late deliveries? If Boeing is holding up to their agreement then he has no right to spew such nonsense. Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence. But there's plenty of evidence of horrible workmanship coming out of Washington State with the 767 tanker.

I think he’s a bit in the right here. I would be pissed off. Especially in this time if you actually have customers that want to take the jet.

Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?
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ILNFlyer
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 2:25 pm

Sounds to me like Boeing is a long long way from being the great aircraft production company it once was.
 
djpearman
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 2:31 pm

Revelation wrote:
Opus99 wrote:
TTailedTiger wrote:
What exactly is he talking about? Has Boeing not lived up to the contract and paid any penalties for late deliveries? If Boeing is holding up to their agreement then he has no right to spew such nonsense. Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence. But there's plenty of evidence of horrible workmanship coming out of Washington State with the 767 tanker.

I think he’s a bit in the right here. I would be pissed off. Especially in this time if you actually have customers that want to take the jet.

Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?


I would assume the CEO of a large lessor would have already had ample opportunity to do so.
 
kalvado
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 2:32 pm

Revelation wrote:
Opus99 wrote:
TTailedTiger wrote:
What exactly is he talking about? Has Boeing not lived up to the contract and paid any penalties for late deliveries? If Boeing is holding up to their agreement then he has no right to spew such nonsense. Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence. But there's plenty of evidence of horrible workmanship coming out of Washington State with the 767 tanker.

I think he’s a bit in the right here. I would be pissed off. Especially in this time if you actually have customers that want to take the jet.

Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?

If BOD needs to learn about such problems from their customers, and customers are frustrated enough to air to the press, then the case for business relationship is already pretty weak.
 
Exeiowa
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 2:44 pm

The problem is that the produced are aircraft are not within the manufacturers specifications. They are probably safe. We are not talking carpets that could be easily replaced but specified sizes in the carbon fiber panels. This is not an engineering problem but would more fall under the material science sphere. It would seem that this is another reputation damaging item to an actual company that buys products unlike any of us who do not get to call shots in plane manufacture. Losing the trust of major lessors is not good. I am pretty sure when Airbus failed to deliver a promise they also had second thoughts on future deals. Its just Boeing has currently managed to group a bunch of them together so they are getting the kicking for now.
 
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Revelation
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 2:47 pm

kalvado wrote:
Revelation wrote:
Opus99 wrote:
I think he’s a bit in the right here. I would be pissed off. Especially in this time if you actually have customers that want to take the jet.

Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?

If BOD needs to learn about such problems from their customers, and customers are frustrated enough to air to the press, then the case for business relationship is already pretty weak.

Sure, it's already pretty weak, but the question was about the most productive way to deal with that weak relationship.

If I was going through tough times in a relationship with a person, I don't think telling all their friends and neighbors that I think they need to get their house in order is going to be very productive. Sure, it may feel good to vent a bit, but in the end I still have to deal with that person one on one.
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
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Revelation
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 2:54 pm

Exeiowa wrote:
The problem is that the produced are aircraft are not within the manufacturers specifications. They are probably safe. We are not talking carpets that could be easily replaced but specified sizes in the carbon fiber panels. This is not an engineering problem but would more fall under the material science sphere. It would seem that this is another reputation damaging item to an actual company that buys products unlike any of us who do not get to call shots in plane manufacture. Losing the trust of major lessors is not good. I am pretty sure when Airbus failed to deliver a promise they also had second thoughts on future deals. Its just Boeing has currently managed to group a bunch of them together so they are getting the kicking for now.

If you read Calhoun's comments, it seems a big part of this seems to be getting the regulators to agree on what is acceptable and what is not. In turn this seems to stem from the basic mistrust the regulators must be feeling after the MCAS tragedy. Let us not forget Boeing admitted in court to having committed fraud in their submissions to the FAA. We now see this open-ended 787 investigation, and we see both MAX10 and 777X being pushed back years. It's some very challenging waters for Boeing to navigate, the after-effect of their earlier misdeeds.
Wake up to find out that you are the eyes of the world
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Wake now, discover that you are the song that the morning brings
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kalvado
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 3:04 pm

Revelation wrote:
kalvado wrote:
Revelation wrote:
Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?

If BOD needs to learn about such problems from their customers, and customers are frustrated enough to air to the press, then the case for business relationship is already pretty weak.

Sure, it's already pretty weak, but the question was about the most productive way to deal with that weak relationship.

If I was going through tough times in a relationship with a person, I don't think telling all their friends and neighbors that I think they need to get their house in order is going to be very productive. Sure, it may feel good to vent a bit, but in the end I still have to deal with that person one on one.

Sometimes escalating the issue and applying pressure is the productive way. Letting news to reach shareholders, who may otherwise listen mostly to BoD perspective, is definitely a possibility
 
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Revelation
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 3:30 pm

kalvado wrote:
Revelation wrote:
If I was going through tough times in a relationship with a person, I don't think telling all their friends and neighbors that I think they need to get their house in order is going to be very productive. Sure, it may feel good to vent a bit, but in the end I still have to deal with that person one on one.

Sometimes escalating the issue and applying pressure is the productive way. Letting news to reach shareholders, who may otherwise listen mostly to BoD perspective, is definitely a possibility

I'm having a hard time seeing how public venting is going to get him his 787s one second earlier, so I'm not seeing how this could be productive.

I can see how people at Boeing can feel he's kicking them while they are down and how he is adding stress to an already stressful situation in a unprofessional way, and those kinds of things are remembered for a lifetime.

If we want to be more crass we can suggest he's posturing for the benefit of his shareholders, or we can say he's reducing the safety envelope by putting pressure on Boeing and regulators to get him his airplanes.

It's hard for me to see how he ends up ahead with this strategy.
Wake up to find out that you are the eyes of the world
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Wake now, discover that you are the song that the morning brings
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iamlucky13
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 3:38 pm

FlyingElvii wrote:
iamlucky13 wrote:
My view has been the big delays in 787 deliveries actually are about Boeing getting their house in order. I'm not quite clear how long this has been an issue, but the impression I got from previous reporting is they previously had looked at each issue in isolation, and determined they were acceptable, but for undisclosed reasons decided to look at it more expansively, and realized the combined condition is a concern.

So when Calhoun said at the earnings call (some commentary of mine in parenthesis):

Well, there won't be a formal sign-off in that regard (from the FAA. Boeing still has delegated authority for 787 airworthiness certificates?). But, without a doubt, we will make sure the FAA is comfortable with every act we've taken. And I'll only add the comment that this expansion of inspection and quality assurance and all those things, maybe I'll take a hit on that one (I think he is saying they are uncertain whether this level of inspection and delay is necessary, but they made the call to delay anyways). But this is a moment where we get to fix some things and do some things the way we would like to do them.

And so I have put very little pressure on production and engineering team to resolve things too quickly. I want it to be thorough and done, and I want to prevent future rework around this stuff.


I'm hopeful that this is an example of taking a step back and re-evaluating if there are any potential concerns they can take a closer look at and proactively resolve even if it's not clear whether it is a problem, to ensure it does not become a problem later.

As for ALC's comment, I found it refreshing, at least to the degree it suggests that some airlines actually do want widebody deliveries right now.

How much of these inspection items, if any, are quality issues due to the international sourcing of components and structures?


The people who know aren't going to be permitted to answer. The answers we see here will be speculation.

From my experience at a couple different companies over my career, though, I will say that in general:

1) External suppliers are less likely to understand the requirements fully. The more detailed and precise the requirements, the more comprehensive the acceptance plan needs to be.
2) Even internal manufacturing teams require close involvement with engineering to implement the intended requirements and clarify, and can make mistakes, too.
3) It is very common for engineers to over-specify and have to follow up later when manufacturing difficulty arise to determine if the original requirement is truly necessary or conservative.
 
Aptivaboy
Posts: 990
Joined: Fri Jul 15, 2016 3:32 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 3:49 pm

I'm having a hard time seeing how public venting is going to get him his 787s one second earlier, so I'm not seeing how this could be productive.

I can see how people at Boeing can feel he's kicking them while they are down and how he is adding stress to an already stressful situation in a unprofessional way, and those kinds of things are remembered for a lifetime.


By publicly venting, it does add increased pressure on Boeing, which may spur them to greater efficiencies; it may force Boeing to move quicker to fix its 787 problems. Or not. Time will tell. If nothing else, and I actually think that this is the big thing, Boeing is being put on notice not to expect any orders for new designs from ALC until they fix their older issues. This is really a long term shot across the bow, a very public Come to Jesus moment, in my view.

As for things being remembered, Boeing won't care one iota years down the road as long as the order keep flowing in. Airlines like Ryanair have played hardball with them for years and they keep signing order forms with them. As long as the price is right and the production line keeps moving, Boeing will not care what is said today. They have shareholders to appease, and they won't shaft ALC over these comments several years from now.
 
Gremlinzzzz
Posts: 254
Joined: Fri Jan 24, 2020 4:28 am

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 4:04 pm

Revelation wrote:
kalvado wrote:
Revelation wrote:
If I was going through tough times in a relationship with a person, I don't think telling all their friends and neighbors that I think they need to get their house in order is going to be very productive. Sure, it may feel good to vent a bit, but in the end I still have to deal with that person one on one.

Sometimes escalating the issue and applying pressure is the productive way. Letting news to reach shareholders, who may otherwise listen mostly to BoD perspective, is definitely a possibility

I'm having a hard time seeing how public venting is going to get him his 787s one second earlier, so I'm not seeing how this could be productive.

I can see how people at Boeing can feel he's kicking them while they are down and how he is adding stress to an already stressful situation in a unprofessional way, and those kinds of things are remembered for a lifetime.

If we want to be more crass we can suggest he's posturing for the benefit of his shareholders, or we can say he's reducing the safety envelope by putting pressure on Boeing and regulators to get him his airplanes.

It's hard for me to see how he ends up ahead with this strategy.
He is hardly the only client that is making noise about Boeing. Emirates has had issues with the 777X delays and talked about that, they have similarly talked about wanting to have certification flights in Dubai. They had an issue with Airbus when the A380 was delayed and they did not have an issue voicing it in the public domain.

AAB has talked about Airbus (mostly delays) and Boeing relationship not being as good as it should be and it was not long ago that ET was saying that they would possibly be the last airline to fly the MAX.

Sometimes, as a paying client, you need to put pressure on a supplier to meet their end of the bargain. I have been in this situation before where we either had bureaucracy or unreliable partners messing our work. It is some of the most frustrating workplace nonsense anyone has to deal with especially in an industry where there is a lot of long term planning.
 
iamlucky13
Posts: 1400
Joined: Wed Aug 08, 2007 12:35 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 4:23 pm

kalvado wrote:
Revelation wrote:
Opus99 wrote:
I think he’s a bit in the right here. I would be pissed off. Especially in this time if you actually have customers that want to take the jet.

Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?

If BOD needs to learn about such problems from their customers, and customers are frustrated enough to air to the press, then the case for business relationship is already pretty weak.


The BOD is not learning about 787 delivery delays from customers. Boeing disclosed this publicly last summer. They've been bringing it up in their shareholder meetings and in other contexts since then.

Both Boeing and ALC are financially affected by this. The effect on Boeing is probably more acute. For Boeing, the 787 is one of their main revenue sources at the moment, most of the expenses required to build these 787's are already realized, and that revenue is really stalled until they are ready to deliver. For ALC, I would imagine with the used and lease market the way it is right now, they've got some options to broker alternative arrangements for their customers, and although those might not be as profitable or provide the same business stability as longer term leases on brand new aircraft, the delayed deliveries also delay some of ALC's expenses.

I think it would be very easy to read Calhoun's comments from the shareholder meeting as more casual than they are, or as executive posturing. But from the shareholder's perspective, their company is bleeding cash, and some chain of decision makers including Calhoun (but also including the designees who issue the airworthiness certificates and the quality people who signoff the aircraft as ready for delivery) is stalling what I assume is billions of dollars worth of cash flow right at the time the company needs it the most.

Calhoun's statement to shareholders, "maybe I'll take a hit on that one" seems to translate as, "I decided to let the company's financial position get worse in order to ensure we resolve this problem now, because the downside of waiting to learn more and asking the regulators to trust us in the meantime could be worse than the upside of struggling less through the worst part of the current financial crisis and paying back our debt faster."

A lot of people think nothing has changed at the upper levels of Boeing, and nothing was learned. The way the 787 issues are being dealt with appears to me to be a sign to the contrary.
 
dtw2hyd
Posts: 8920
Joined: Wed Jan 09, 2013 12:11 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 4:25 pm

Revelation wrote:
I can see how people at Boeing can feel he's kicking them while they are down and how he is adding stress to an already stressful situation in a unprofessional way, and those kinds of things are remembered for a lifetime.


And shrugging off design/build quality issues as airline maintenance practices, and accidents as airline training issues is professional.
All posts are just opinions.
 
jeffrey0032j
Posts: 947
Joined: Wed Jun 15, 2016 3:11 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 4:45 pm

iamlucky13 wrote:
kalvado wrote:
Revelation wrote:
Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?

If BOD needs to learn about such problems from their customers, and customers are frustrated enough to air to the press, then the case for business relationship is already pretty weak.


The BOD is not learning about 787 delivery delays from customers. Boeing disclosed this publicly last summer. They've been bringing it up in their shareholder meetings and in other contexts since then.

Both Boeing and ALC are financially affected by this. The effect on Boeing is probably more acute. For Boeing, the 787 is one of their main revenue sources at the moment, most of the expenses required to build these 787's are already realized, and that revenue is really stalled until they are ready to deliver. For ALC, I would imagine with the used and lease market the way it is right now, they've got some options to broker alternative arrangements for their customers, and although those might not be as profitable or provide the same business stability as longer term leases on brand new aircraft, the delayed deliveries also delay some of ALC's expenses.

I think it would be very easy to read Calhoun's comments from the shareholder meeting as more casual than they are, or as executive posturing. But from the shareholder's perspective, their company is bleeding cash, and some chain of decision makers including Calhoun (but also including the designees who issue the airworthiness certificates and the quality people who signoff the aircraft as ready for delivery) is stalling what I assume is billions of dollars worth of cash flow right at the time the company needs it the most.

Calhoun's statement to shareholders, "maybe I'll take a hit on that one" seems to translate as, "I decided to let the company's financial position get worse in order to ensure we resolve this problem now, because the downside of waiting to learn more and asking the regulators to trust us in the meantime could be worse than the upside of struggling less through the worst part of the current financial crisis and paying back our debt faster."

A lot of people think nothing has changed at the upper levels of Boeing, and nothing was learned. The way the 787 issues are being dealt with appears to me to be a sign to the contrary.

I agree with this, furthermore, this downturn in the airline industry is almost the perfect time to do such a spring cleaning of the company. When nobody needs planes, it is easier to divert resources to any reviews and checks that is needed. The fact that they decided to support the 777 PW engine grounding is unprecedented in recent history in the industry, despite it being an old engine manufactured by what can be considered as a third party supplier. Not even the very glaring and possibly more worrisome A220/A320 PW GTF failures or the A330 Trent 700 serious engine failures that pop up from time to time led to the airframe manufacturer supporting the grounding, even the A380 groundings were airline led (under advice from EASA) instead of having support from the airframe manufacturer. If anything, Boeing's reaction to the PW 777 groundings will force other airframe manufacturers to thread a bit more carefully with serious engine failures.
 
WayexTDI
Posts: 2160
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 4:50 pm

Revelation wrote:
Opus99 wrote:
TTailedTiger wrote:
What exactly is he talking about? Has Boeing not lived up to the contract and paid any penalties for late deliveries? If Boeing is holding up to their agreement then he has no right to spew such nonsense. Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence. But there's plenty of evidence of horrible workmanship coming out of Washington State with the 767 tanker.

I think he’s a bit in the right here. I would be pissed off. Especially in this time if you actually have customers that want to take the jet.

Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?

Do you really think Akbar Al Baker and his well-known public comments has burned bridges between Qatar Airways and both Airbus and Boeing? Who else is Qatar going to order to?
 
FlyingElvii
Posts: 1239
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Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 5:01 pm

ILNFlyer wrote:
Sounds to me like Boeing is a long long way from being the great aircraft production company it once was.

That is what happens when competition is no longer there to keep them honest and innovative. McDonnell, Lockheed, Douglas, Fokker, even the small players like Fairchild, Gulfstream or Beech meant that the culture had to constantly innovate to maintain a leading presence.

HQ and Engineering aren’t even in the part of the country anymore, let alone in the same building or campus, and hundreds of miles away from the nearest manufacturing facilities. IMHO, that tells you everything you need to know. Without viable competition, the “Corporate Culture” has replaced the engineering culture. Financial and political lobbying relationships are now more important than innovation.

Boeing I’d far from the only company to go down this path. Look at what has happened to GE, for instance.
 
Noshow
Posts: 2207
Joined: Wed Jun 15, 2016 3:20 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 5:09 pm

DIdn't they even employ some GE execs to lead their transformation?
 
Gremlinzzzz
Posts: 254
Joined: Fri Jan 24, 2020 4:28 am

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 5:13 pm

WayexTDI wrote:
Do you really think Akbar Al Baker and his well-known public comments has burned bridges between Qatar Airways and both Airbus and Boeing? Who else is Qatar going to order to?
Airbus and Boeing will not burn bridges huge clients because they said something in public. Any OEM silly enough to do so even to some of the smaller clientele, even when they have been wronged ought not be in business.

In this case, all Boeing can do is state to clients that they are working as fast as they can to try and deliver a product that meets specification. They will be pissed, and some will vent in public that domestic/in house issues is messing up their business model. How many remember clients telling Airbus rather publicly that the Neo program was not going to be good enough for the A330? They got to business and rolled out a new clean sheet wide body jetliner.
 
jeffrey0032j
Posts: 947
Joined: Wed Jun 15, 2016 3:11 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 5:23 pm

FlyingElvii wrote:
ILNFlyer wrote:
Sounds to me like Boeing is a long long way from being the great aircraft production company it once was.

That is what happens when competition is no longer there to keep them honest and innovative. McDonnell, Lockheed, Douglas, Fokker, even the small players like Fairchild, Gulfstream or Beech meant that the culture had to constantly innovate to maintain a leading presence.

HQ and Engineering aren’t even in the part of the country anymore, let alone in the same building or campus, and hundreds of miles away from the nearest manufacturing facilities. IMHO, that tells you everything you need to know. Without viable competition, the “Corporate Culture” has replaced the engineering culture. Financial and political lobbying relationships are now more important than innovation.

Boeing I’d far from the only company to go down this path. Look at what has happened to GE, for instance.

To be fair, Airbus has their HQ in the Netherlands instead of Toulouse or Hamburg.
 
smartplane
Posts: 1668
Joined: Fri Aug 03, 2018 9:23 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 5:33 pm

Revelation wrote:
kalvado wrote:
Revelation wrote:
If I was going through tough times in a relationship with a person, I don't think telling all their friends and neighbors that I think they need to get their house in order is going to be very productive. Sure, it may feel good to vent a bit, but in the end I still have to deal with that person one on one.

Sometimes escalating the issue and applying pressure is the productive way. Letting news to reach shareholders, who may otherwise listen mostly to BoD perspective, is definitely a possibility

I'm having a hard time seeing how public venting is going to get him his 787s one second earlier, so I'm not seeing how this could be productive.

I can see how people at Boeing can feel he's kicking them while they are down and how he is adding stress to an already stressful situation in a unprofessional way, and those kinds of things are remembered for a lifetime.

If we want to be more crass we can suggest he's posturing for the benefit of his shareholders, or we can say he's reducing the safety envelope by putting pressure on Boeing and regulators to get him his airplanes.

It's hard for me to see how he ends up ahead with this strategy.

What we don't know is the duration and specifics of the dialogue that preceded the public outburst. But lets assume it's been over an extended period, with little or no satisfactory response from Boeing.

The Head of Global Account Management effectively reports direct to Calhoun. The whole team has been refreshed and expanded.
 
Opus99
Posts: 1954
Joined: Thu May 30, 2019 10:51 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 5:40 pm

Revelation wrote:
Opus99 wrote:
TTailedTiger wrote:
What exactly is he talking about? Has Boeing not lived up to the contract and paid any penalties for late deliveries? If Boeing is holding up to their agreement then he has no right to spew such nonsense. Just as bad as the people claiming 787's produced in South Carolina are unfit. Zero evidence. But there's plenty of evidence of horrible workmanship coming out of Washington State with the 767 tanker.

I think he’s a bit in the right here. I would be pissed off. Especially in this time if you actually have customers that want to take the jet.

Ok, so he vented in a very public way by answering a reporter's question, it could even be said he redirected the reporter's question just so he could vent. He feels better, but other than that, is it going to do him or his company any good? It could end up causing damage to an important business relationship. Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?

Oh of course he could have handled better. His public venting doesn’t solve anything but I feel he’s in the right to be unhappy with Boeing concerning the 787. But he could’ve definitely handled differently especially as I am sure some other customers would be pissed
 
BoeingGuy
Posts: 6507
Joined: Fri Dec 10, 2010 6:01 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 5:51 pm

LCDFlight wrote:
All of this was predicted when Boeing stopped respecting engineering project management and the manufacturing process.

People without even basic respect or knowledge of these processes were put in charge of Boeing, based on a vacuous "streamlining" premise. Where important parts of these processs are skipped to save time and money. It is extremely important to record that, in terms of time and money, these people's ideas totally, epically failed. Their business philosophy was groundless and without any merit. And they also caused deaths.


Not like many of us at Boeing didn’t see this coming 25 years ago. The decline pre-dated the McD merger, although things certainly got a lot worse after that.

There is never enough money in the budget to do it right the first time, but there is always enough money to spend Billions of dollars later to fix it.

There has been little to no emphasis on customer satisfaction or being World Class. It’s a bunch of beancounters who know nothing about nothing but short-term cost savings. Which of course costs far more in the long run.

Thinks are starting to get a little better now, because there is nowhere to go but up since the 737 Max disaster.
 
kalvado
Posts: 3074
Joined: Wed Mar 01, 2006 4:29 am

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 6:03 pm

Revelation wrote:
kalvado wrote:
Revelation wrote:
If I was going through tough times in a relationship with a person, I don't think telling all their friends and neighbors that I think they need to get their house in order is going to be very productive. Sure, it may feel good to vent a bit, but in the end I still have to deal with that person one on one.

Sometimes escalating the issue and applying pressure is the productive way. Letting news to reach shareholders, who may otherwise listen mostly to BoD perspective, is definitely a possibility

I'm having a hard time seeing how public venting is going to get him his 787s one second earlier, so I'm not seeing how this could be productive.

I can see how people at Boeing can feel he's kicking them while they are down and how he is adding stress to an already stressful situation in a unprofessional way, and those kinds of things are remembered for a lifetime.

If we want to be more crass we can suggest he's posturing for the benefit of his shareholders, or we can say he's reducing the safety envelope by putting pressure on Boeing and regulators to get him his airplanes.

It's hard for me to see how he ends up ahead with this strategy.

Sure such venting can help. If the assumption is that the leadership of the company is not fit for their jobs, reaching out to shareholders is the last escalation step. Although Boeing's major shareholders are well known, picking up the phone and calling them is not a technical problem - but probably a huge issue in terms of insider trading and what not. So communication through public channels is the way of doing it.
Is that really the case? "Get your shit together, or drop down and die" is a very harsh message...
 
gobears19
Posts: 10
Joined: Fri Jan 24, 2020 8:25 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 8:15 pm

BoeingGuy wrote:
LCDFlight wrote:
Thinks are starting to get a little better now, because there is nowhere to go but up since the 737 Max disaster.


If the Dreamliner becomes a problem aircraft for customers (like the Max is), Boeing will be left with exactly what quality product available to sell today? Like 90% of their orders would be at risk at that point, no?
 
Opus99
Posts: 1954
Joined: Thu May 30, 2019 10:51 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 8:17 pm

gobears19 wrote:
BoeingGuy wrote:
LCDFlight wrote:
Thinks are starting to get a little better now, because there is nowhere to go but up since the 737 Max disaster.


If the Dreamliner becomes a problem aircraft for customers (like the Max is), Boeing will be left with exactly what quality product available to sell today? Like 90% of their orders would be at risk at that point, no?

Even at that. Max is still selling. Boeing customers are very very loyal.

Even today we have QR asking for 777X freighter.

I don’t think the 787 will get to that point. It’s been in service for over 10 years...with its rough start, quality issues, it’s still the go to widebody frame
 
Vicenza
Posts: 269
Joined: Sun Apr 19, 2020 3:21 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 8:40 pm

Revelation wrote:
Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?


But then again, there is also an element on a.net who prefer that all problems at Boeing should be kept well hidden, and out of view. I would suggest he has perhaps already done so and, as stated in the article, there seems to be be no progress on a resolution. I see no evidence that he 'redirected' a reporter's question as you conveniently suggest.
 
SRJ94AB
Posts: 10
Joined: Tue Feb 23, 2021 10:54 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 8:52 pm

Opus99 wrote:
gobears19 wrote:
BoeingGuy wrote:


If the Dreamliner becomes a problem aircraft for customers (like the Max is), Boeing will be left with exactly what quality product available to sell today? Like 90% of their orders would be at risk at that point, no?

Even at that. Max is still selling. Boeing customers are very very loyal.

Even today we have QR asking for 777X freighter.

I don’t think the 787 will get to that point. It’s been in service for over 10 years...with its rough start, quality issues, it’s still the go to widebody frame



The 787 will be popular going forward but it will depend on the outcome of these fuselage inspections. The fact they are having to do these inspections and calculations is pretty alarming, and with ALC claiming they can’t see how the regulators are going to get around this issue is not a good sign.

It may have been in service for 10 years but if the calculations find something that effects the fatigue life or structural integrity long term then potentially the fleet could have to be de-rated. I guess we shall have to wait see what happens.
 
User avatar
Revelation
Posts: 25793
Joined: Wed Feb 09, 2005 9:37 pm

Re: ALC tells Boeing "to get house in order"

Wed Feb 24, 2021 9:10 pm

Vicenza wrote:
Revelation wrote:
Couldn't he have handled this in a more productive way? Say similar things, but say them in a private letter addressed to the Boeing CEO and BoD?

But then again, there is also an element on a.net who prefer that all problems at Boeing should be kept well hidden, and out of view. I would suggest he has perhaps already done so and, as stated in the article, there seems to be be no progress on a resolution. I see no evidence that he 'redirected' a reporter's question as you conveniently suggest.

My understanding, convenient or otherwise, was that he was being asked about what he wanted from a new Boeing aircraft project and he redirected the topic to 787:

From the thread starter's link:

Speaking at the lessor’s earnings call yesterday, CEO John Plueger said that, before Boeing embarks on any new aircraft project, it needed to get its current products in order. He said,

“We want Boeing to … get its house right, to get its house in order. The 787 delays are impacting us, as well as the rest of the delivery, the manufacturing process. Boeing has gone through a tremendously difficult time and while they certainly have made a lot of progress, the blunt truth is we need them to fix the remainder of their house first before we have any interest in talking about new aircraft.”
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