WingedMigrator
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Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 4:37 am

Mike Bair, former 787 program manager, comments on the challenges he encountered with suppliers.

http://seattletimes.nwsource.com/htm...erospace/2003986302_webbair01.html

Fair use excerpts:

Quote:
"The right way to do this would be to have all those big parts across the street so you could just roll them in"

(...)

As for the global network of suppliers working on the now-delayed 787, Bair had some blunt words. "Some of these guys we won't use again."

(...)

He said the problems in completing the first airplane resulted from the production system in Everett being overwhelmed with parts work that should have been done by the suppliers.

"That whole production system is built for 1,200 pieces. ... Everything about it was designed for 1,200 parts," he said. "We threw 30,000 at it."

Bair said some of the major airframe partners on the Dreamliner have performed so poorly that Boeing likely won't use them on future programs.

He also said some engineering design work had to be pulled back inside Boeing when the partners couldn't deliver.

(...)

Bair declined to name the suppliers Boeing "won't use again." He said he was referring not just to the six first-tier airframe partners — Alenia of Italy; Mitsubishi, Fuji and Kawasaki of Japan; Spirit of Wichita, Kan.; Vought of Texas — but also to some of their suppliers in the second tier.

I find it rather surprising that Boeing would heap such scorn on suppliers that they're signed up to do business with for the next several years. I suppose "they know who they are", but does anyone have any ideas as to which exact suppliers are incriminated?
 
grantcv
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 6:52 am

I have often wondered if Boeing's decision to outsource so much of the 787 wasn't part of Boeing management's dissatisfaction with their own workforce and all the strikes in recent years. It has often seemed to me, even when I was employed by Boeing, that management gets frustrated with their workforce and look to other vendors as a better solution. Knowing the good and bad about your own workforce, and then comparing that to the glossy presentation of outside vendors, it is easy to see the rationale for outsourcing. But when reality sets in, everyone has pretty much the same lousy workforce and the problems are the same everywhere. But with outsourcing the management problem is more difficult. On the brighter side though, you have someone else to blame.
 
abba
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:24 am

Quoting WingedMigrator (Thread starter):
I find it rather surprising that Boeing would heap such scorn on suppliers that they're signed up to do business with for the next several years

To me this also indicates some level of immaturity on the part of the Boeing's management. First they seem not fully capable of selecting partners carefully enough - to evaluate their potential well enough. Secondly it seems as if they lack skills in managing such diverse supply chain as they have build around the 787 program - and in particular foresee which initial problems will arise untill the supply system is fully tuned in and it has become routine for the suppliers to produce "their" particular parts to a given standard.

I wouldn't be surprised either if Boeing also lack the ability to follow, support and communicate effectively with their supply chain in the development phase. The frustration expressed in the words of Bair might as well indicate incompetence on the part of his own organisation in leading a program as out-sourced as the 787 program as well as uselessness on behalf of their suppliers.

Abba
 
Carpethead
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:29 am

I wonder if any of these suppliers are Japanese.
There are companies in Japan that do top notch design, manufacturing, and skilled work force (albeit probably at high cost), but some just can't cut the mustard too.
 
swallow
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:38 am

Quote, "That whole production system is built for 1,200 pieces. ... Everything about it was designed for 1,200 parts," he said. "We threw 30,000 at it."

More clarity about why things have bogged down at the Everett factory. His disappointment is palpable and understandable.

Supply chain management is challenging and this will provide good material for case studies on global outsourcing in business schools around the world.

Makes me wonder about the implications for production ramp up. It may not be as fast as anticipated with over 100 planes to be ready for delivery by end 2009.

It also gives Airbus food for thought on the 350 supply chain. Do more design in-house seems to be the mantra going forward.
The grass is greener where you water it
 
swallow
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 9:18 am

Quoting WingedMigrator (Thread starter):
suppose "they know who they are", but does anyone have any ideas as to which exact suppliers are incriminated?

For first tier suppliers, I would guess Vought and Alenia as they have been highlighted in the press before. Have not heard complaints about the Japanese 'heavies'.
The grass is greener where you water it
 
BrianDromey
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 9:27 am

I think a lot of the problem may lie with the realtive in experience Boeing has with this type of "stuffed" construction, and movng large parts of completed airliner from one corner of the globe to another. Something on this magnitude ahs never been seen before, and with different countires,languages and customs it was bound to get a bit tricky. Airbus make it look easy, but remember that they have been doing at for 20years, every day. That sort of experience is bound to teach many lessons.

Everything about the 787 is pushing boundaries. That is definately a good thing. Once it enters service Im sure the airlines wil love it, even if the delay stretches further. If airlines will wait 2.5 years for the A380, they will wait for the 787 "revolution" too. Anyhow, widebodies are no exactly plentiful right now....

Brian.
 
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keesje
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 9:37 am

Quoting WingedMigrator (Thread starter):
Mike Bair, former 787 program manager, comments on the challenges he encountered with suppliers.

Thnx for posting. very interesting strategic stuff. It confirms what people in the business have been mentioning : Boeing is learning hard lessons about outsourcing so much 787 design & production.

Of course this has been denied for yrs, Bair however is source that can not be denied.

I think the world has been looking at this Boeing experiment and will draw its conclusions and dependency on far away suppliers, program management, communication and contratcting.

One lesson: pressing suppliers to come up with rock bottom prices / bring in big money to get a piece of the pie might hurt later on when you really need them. They grab you by the b.lls.
"Never mistake motion for action." Ernest Hemingway
 
Lumberton
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 10:08 am

Quoting Grantcv (Reply 1):
I have often wondered if Boeing's decision to outsource so much of the 787 wasn't part of Boeing management's dissatisfaction with their own workforce and all the strikes in recent years.

 checkmark  I'm sure it was a factor in the decision. I don't want to drag this thread off topic, but long term labor peace is something that Boeing sorely needs. In a few months it will be time to renegotiate the contract with their unions. Will the 787 model be the "ceiling" for outsourcing, or the "floor"? In other words, what lessons will be incorporated in the production of the next new aircraft--more or less outsourcing?
"When all is said and done, more will be said than done".
 
PolymerPlane
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 12:15 pm

What surprises me most is that Boeing actually asked the suppliers to design the parts for them. I do not think this is a wise idea. It probably would have been better for them and the 787 project to have Boeing design the whole thing and have other people to manufacture it for them. I think it's a really different ball game with designing and just manufacturing. Boeing's expertise is in designing the airplane, it should not have been outsourced.

Cheers,
PP
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par13del
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 12:34 pm

American companies have been leading the outsourcing charge for many years, I find it hard to believe that Boeing is in any way re-inventing the wheel when it comes to outsourcing, the percentage may differ but the process is the same. The majority of the work is outside your control other than paper specifications that your specify for quality control etc. I can accept the "conspiracy theory that Boeing did this to ward off their high labour cost - unions - or avoid any disruption in their manufacturing process, if this is the case they did a lousy / lazy job at it, and they are now paying thr price for it. IN previous B787 threads, I have mentioned that Boeing should have set up a second line when indications of delays became apparent, this second line however, was to be a more "traditional" line, which even if not at the same volume, would be a buffer if the "new" line failed or had problems, call it secondary insurance.
 
AirframeAS
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 12:42 pm

When it comes to outsourcing, you get what you pay for. I've said this for years and nobody listens to me nor cares. And thats ok. In this case, this is Boeing's to lose for outsourcing this stuff when they had their own people to do it. Having said that, it seems like Boeing has ZERO confidence in their own people. WTF?!
A Safe Flight Begins With Quality Maintenance On The Ground.
 
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keesje
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 12:48 pm

Foreign governments subsidiezed billions to get a piece of the 787 cake.

Italians, Japanese and others are not interrested to do cut throat costs manufacturing only in return.
"Never mistake motion for action." Ernest Hemingway
 
slz396
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 1:04 pm

Quoting Keesje (Reply 12):
Foreign governments subsidized billions to get a piece of the 787 cake.
Good point indeed.

Some people have apparently forgotten that Boeing has been very eager to sign certain foreign partners which waved a very big check to them.

Boeing itself may not get direct government subsidies, but notably the Japanese partners of the 787 program are highly subsidized (and that is still an understatement really) and it is a given that at program launch Boeing was talking all the time about levelling the playing field with Airbus, feeling they needed to secure more government funding to successfully compete with them.

It now seems some key foreign partners were selected more on the basis of the extend of their financial contribution to the 787, than on their technical skills and knowledge...

With all respect, but I remember several early 7E7 topics in which notably the skills and knowledge as well as the ability to handle large industrial programs of some foreign partners were questioned. As always, those 'ad rem' remarks were quickly dismissed as bashing and were systematically ended off with a trivial: "Do you really think Boeing would be so stupid to take partners that are not capable to do what they are signed for?" Well, it seems Bair has given a very clear answer to that one, didn't he?

When you give away a large part of the 787 program (not only the manufacturing, but also the designing) to "developing countries" -at least when it comes to aviation manufacturing- which aren't really at the same point on the learning curve and aren't meeting all the international standards when they did some programs on their own, you shouldn't be surprised to find out that your end product isn't really meeting all the standards either, regardless how close you watch them.
Quite a worrying outlook for the 787 actually, as god knows what the long term quality and reliability of the 787 will be. That of a traditional Boeing plane is well known, but that of a hybrid Boeing/poorer standard manufacturers plane so far doesn't look too promising...

[Edited 2007-11-01 06:35:26]
 
ebbuk
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 1:55 pm

Teething problems will always occur whenever anything new is in the space. For Boeing it would appear they took the risk right to the limit and it has resulted in a 6 month delay. No more please, we want the 787 out sooner rather later
 
2175301
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 2:23 pm

The key here is the lessons learned. At the end of the day Boeing and the entire aircraft industry will be better off by this program.

A key item though. In a program like this - it was Boeing Managements responsibility to put into place adequate contingencies - and to work with all the suppliers on all levels - to ensure adequate quality and production schedule.

I suggest that instead of blaming others - that a mirror would show the most responsible party.
 
abba
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 2:39 pm

Quoting Swallow (Reply 4):
It also gives Airbus food for thought on the 350 supply chain. Do more design in-house seems to be the mantra going forward.

Airbus has a longstanding experience in exactly this.

A question also is worth asking is the human resources Boeing has in cross cultural communication (save for its sales department). Having lived in Asia for more than a decade I have seen many companies that really wasn't up to the mark in this respect. Some of the worst I have seen has been American (some of the best too - by the way).

However this is a real first hand personal experience I have had in HK: One morning I was to get some cash from an ATM. In front of me were two early twenty American Ladies getting cash. Once they got it out of the machine they started crying - turning to me claiming that they have been sorely cheated. Why? Because they got wasn't real money that one could spend in a shop. What they got was genuine HK$ from the HSBC...

Now, if the ones Boeing has selected to communicate with their Japanese and Italian partners were selected primarily for their engeneering skills....
 
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Stitch
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 3:00 pm

Might I remind (some) folks that Airbus is looking both to spin-off many of their own internal suppliers under Power8 as well as seek risk-sharing partners for the A350 - including some currently doing work on the 787?

As to Boeing's "maturity", might I remind (some) folks of how Airbus France laid much of the A380's problems at the feet of Airbus Germany?


While it is easy for us here at airliners.net to sit back with the benefit of 20-20 hindsight and throw stones at Boeing, the cold, hard facts are that no private company can reasonably be expected to be able to fund a new aircraft program with a price tag between $10-20 billion USD out of their own bank accounts and cash flow and deliver it within a handful of years. As such, they need to find risk-sharing partners to help field the cost - and reap the profits.

The fact is these companies - be they internal like Airbus and the A380 or external like Boeing and the 787 - stated they could meet the need. And yet, in the end, they couldn't. For at least a year, if not longer, Boeing management has been saying the sub-contractors were not meeting expectations, to say nothing of contractual obligations. Boeing shoveled upwards of $750 million in extra R&D spending last year directly to those suppliers to try and get them up-to-speed and maintain the schedule.

If Boeing tried to do all this in-house, they couldn't have afforded it. And even if they could have, it would have added years to the program because all the facilities would have needed to be built and all the staff hired. And then that staff would hold Boeing over a barrel the next time labor talks started because of the sales success of the program.

In the end, Boeing had no choice but to do it this way and since it is the first time they are doing it, there are stumbles and trip-ups. But while annoying and embarrassing, in the end, this is how commercial aerospace needs to be done going forward unless you want the State underwriting the entire costs, as was done in Brazil, China, and Russia...
 
texfly101
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 4:18 pm

Quoting PolymerPlane (Reply 9):
What surprises me most is that Boeing actually asked the suppliers to design the parts for them. I do not think this is a wise idea. It probably would have been better for them and the 787 project to have Boeing design the whole thing and have other people to manufacture it for them. I think it's a really different ball game with designing and just manufacturing. Boeing's expertise is in designing the airplane, it should not have been outsourced.

They have been doing this for years. The 777, 767, and 747 all have supplier's employees that sit at Boeing desks and do a major part of the design. To get the best designer, its often best to use the supplier's engineers. Who knows the parts better than them. And using them also means that you get the best person to design the job and then don't have to pay them after the work is done and you don't need them anymore. Its not the best thing to have Boeing design everything and the manufacturers just build it. You get a better design this way.
As far as the outsourcing/union issues, too bad it will be way too tempting to the conspiracy theory advocates to turn away from, look at the scripted Apollo landing theories that won't die. But the truth of the matter was that it was done for cost control and the economics of the airplane. It had to cost 20% less to buy. You can write a contract and pay a known amount for only the pieces that you need. That gives a known overall cost to buy. Hire a bunch of people to work at Everett and they still have to be paid even if there isn't work to do. Add in the overhead costs like medical, retirement, sick leave, etc and its a hard cost to manage as it variable, mostly upwards vs the non variable cost of buying a wing from a partner. Also, given the fact that the partners shared in the development costs, those being non recurring and up front, Boeing doesn' t have to foot the financial costs, like borrowing funds, paying "today" money to build manufacturing equipment, etc, that entails. They pay for those costs on a "delivered piece" basis which is better for the economics of the airplane. If you look at it from a financial standpoint, it makes a lot of sense to use that strategy. If the unions could have matched that economic set of financials, they would have gotten the work. The unions had a chance to bid on the work and their numbers weren't within the parameters that had been set for a winning bid, i.e the 20% drop in capital costs.
I will say, and I can't really say much more, that if you look at Bair's statements, you will read that he says "supply chain" and that means parts, fasteners not being the only ones involved. The way that parts were handled, or mishandled and not tracked, is a major problem. If you want to take the time, you can read back thru previous news articles and see who was tasked for parts management. You might find that they are not doing that job today. Not living up to glossy presentations when they were awarded the contract and not being able to do the job will get you dropped from the team, that's just a normal clause in any contract.
This airplane's management and assembly strategy was definitely flawed, but not fatally. It will get built, its not that far off from getting done and back on track. You don't see any airlines cancelling orders. And more importantly I think, is that there isn't too much criticism of the delay from the airlines. They have representatives that are on site and know the full status of the 787. They will be a good monitor of what is going on. If they aren't too upset, not cancelling any orders, being willing to absorb the delay, that says a lot.
 
sphealey
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 4:34 pm

> You can write a contract and pay a known amount for only the
> pieces that you need. That gives a known overall cost to buy.
> Hire a bunch of people to work at Everett and they still have
> to be paid even if there isn't work to do.

When you are buying wheat or roofing nails in a fungible market that is clearly true. When you are buying complex supplier-designed components it is not so clear: the supplier has to take into account that _it_ might end up with people standing around (as Airbus' suppliers have, as Alenia has). So the supplier either has to factor that into the price or he has to take _real_ risk (not Wall Street risk) that he could end up holding the short end of the stick. If the situation turns bad the supplier can now (1) ask for a price increase (2) go bankrupt (3) eat the cost - which will eventually have other effects on the managers and the entity. Ford used to have an entire auditing department that went around to suppliers and reviewed their books to ensure that the suppliers weren't signing contracts that put their financial stability at risk.

There's no free lunch - certainly not in complex high-tech manufacturing.

sPh
 
abba
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 4:41 pm

Quoting Sphealey (Reply 19):
There's no free lunch - certainly not in complex high-tech manufacturing.

 checkmark 
 
Wsp
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 5:37 pm

Quoting WingedMigrator (Thread starter):
Bair said some of the major airframe partners on the Dreamliner have performed so poorly that Boeing likely won't use them on future programs.

He is stuck with them for the 787 and will have to bring them up to speed. This will cost money and time and they have no choice, they have to do it anyway. So what is the point to throw all that away and go for another untested partner in the next project?

IMHO he is either bluffing or he is run by emotions rather than rational thought.
 
ScottB
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 5:55 pm

Quoting AirframeAS (Reply 11):
Having said that, it seems like Boeing has ZERO confidence in their own people.

I doubt that it is the case that Boeing has no confidence in the SKILLS of its employees; rather, it's the fact that Boeing has COMPLETE confidence that its employees will again turn the screws when it comes time to negotiate a new contract. And, by the same token, they needed to demonstrate to Washington State that they weren't going to necessarily remain the piggy bank for the state's budget.
 
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Stitch
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 6:42 pm

Quoting Slz396 (Reply 13):
Quite a worrying outlook for the 787 actually, as god knows what the long term quality and reliability of the 787 will be. That of a traditional Boeing plane is well known, but that of a hybrid Boeing/poorer standard manufacturers plane so far doesn't look too promising...

This statement beggars belief...

To think that Boeing or Airbus would even take a chance on fielding a plane that was unsafe is...well, I can't find the words. Especially in a society as litigious as this one. And folks talk about Boeing or Airbus "losing all credibility" over being late with a delivery.,,

[Edited 2007-11-01 11:45:34]
 
Aircellist
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 7:57 pm

From the article:

Quote:
The 737 replacement jet is expected to fly around 2015, and selection of the manufacturing site would likely be made at least five years earlier.

At one point, explaining the reason for the 787's global supply chain, Bair said it was difficult to ask the Japanese to invest money and then build their sections somewhere else than Japan.

So is the supersite concept that he outlined — supplier factories located alongside final assembly — really practical?

"I don't think it's outside the realm of what may have to be done," Bair said in the interview afterward. "Toyota builds as many cars here in the U.S. as in Japan."



Quoting Grantcv (Reply 1):
I have often wondered if Boeing's decision to outsource so much of the 787 wasn't part of Boeing management's dissatisfaction with their own workforce and all the strikes in recent years.



Quoting Slz396 (Reply 13):
Boeing itself may not get direct government subsidies, but notably the Japanese partners of the 787 program are highly subsidized (and that is still an understatement really) and it is a given that at program launch Boeing was talking all the time about levelling the playing field with Airbus, feeling they needed to secure more government funding to successfully compete with them.

From the article again:

Quote:
Bair said when Boeing staged the 2003 to choose a 787 assembly site, ""We weren't being mean. Or trying to do anything heavy-handed."

"Painful as it was for everybody, it spurred a lot of action here in Washington about the need to be competitive," he said. "The state and everybody responded beautifully."

And now, his comments indicate, Washington may have to respond again.

"It really was not a game Boeing was playing," in 2003, said Snohomish EDC's Knutson. "It came down to the cost of doing business. You are going to have to do that exercise again."

Just like last time, she sees the southeast United States as this state's prime competition. She said the state should push workforce training, expanded tax breaks and other indirect incentives.

"It's ours to lose," said Knutson. "We have to fight for it. ... This may be the first warning call."

A little bit out of topic, but...

Could the successor to the 737 be built in Japan?
"When I find out I was wrong, I change my mind. What do you do?" -attributed to John Maynard Keynes
 
ikramerica
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:09 pm

Quoting Aircellist (Reply 24):
Could the successor to the 737 be built in Japan?

I believe it's more likely that a 90-140 seat successor to the MD80/731/2/5/6 could be built as a true joint venture between Boeing and a Japanese firm(s), while a 150-250 seat 737NG successor would be a Boeing product, with a major Japanese company as a partner, but with major work being done in Washington and Oregon, with possibly only wings and stabilizers being shipped from Japan or England.

I think the worldwide waltz of assemblies of the 787 is no more or less convoluted as the A380 supply chain, which posed just as many problems, even though all the work was considered "in house".
Of all the things to worry about... the Wookie has no pants.
 
NYC777
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:10 pm

Well if they're planning to build a large 777/747 successor then those parts (assuming they're going to use the barrell method a la the 787) would be too large to transport along large distances and it would make sense to set up an industrial park where the facilities are in very close proximity to each other to facilitate logistics of the large fuselage sections. These sections certainly cannot be transported on a LCF like the 787.

I think Boeing will be lookig to build larger autoclaves in Everett as that's where Y# will be built IMO.
That which does not kill me makes me stronger.
 
parapente
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:18 pm

Well its really good news to know that there is nothing fundamentally wrong with the design and it wasn't just a few missing fastners after all.
Of course such serious flaws in the supply chain would have been realised ages ago.i.e before rollout. So lets hope the SFO don't spot any major share sales over the "fastner" period a la Airbus A 380.
 
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ER757
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:39 pm

Quoting Grantcv (Reply 1):
I have often wondered if Boeing's decision to outsource so much of the 787 wasn't part of Boeing management's dissatisfaction with their own workforce and all the strikes in recent years.

I believe this definitely entered into the equation. The thing is though, they still have union members doing the assembly and they are just as likely to strike as ever. And if other unions at Boeing strike (SPEEA for example), the unions that support the 787 assembly will walk out in sympathy as well, so not sure what they've really accomplished at the end of the day.

Quoting Slz396 (Reply 13):
When you give away a large part of the 787 program (not only the manufacturing, but also the designing) to "developing countries" -at least when it comes to aviation manufacturing- which aren't really at the same point on the learning curve and aren't meeting all the international standards when they did some programs on their own, you shouldn't be surprised to find out that your end product isn't really meeting all the standards either, regardless how close you watch them.
Quite a worrying outlook for the 787 actually, as god knows what the long term quality and reliability of the 787 will be. That of a traditional Boeing plane is well known, but that of a hybrid Boeing/poorer standard manufacturers plane so far doesn't look too promising...

Oh dear.....your post was going so well up to this point. Your assertion here is so beyond absurd, it hardly warrants a reposnse so I'll say nothing further.
 
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Stitch
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:48 pm

Quoting NYC777 (Reply 26):
Well if they're planning to build a large 777/747 successor then those parts (assuming they're going to use the barrell method a la the 787) would be too large to transport along large distances and it would make sense to set up an industrial park where the facilities are in very close proximity to each other to facilitate logistics of the large fuselage sections. These sections certainly cannot be transported on a LCF like the 787.

You could ship them via, well, ship. WA State built a rail spur from Puget Sound to the Everett factory.
 
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keesje
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:53 pm

Quoting Aircellist (Reply 24):
Quote:
Bair said when Boeing staged the 2003 to choose a 787 assembly site, ""We weren't being mean. Or trying to do anything heavy-handed."

"Painful as it was for everybody, it spurred a lot of action here in Washington about the need to be competitive," he said. "The state and everybody responded beautifully."

And now, his comments indicate, Washington may have to respond again.

"It really was not a game Boeing was playing," in 2003, said Snohomish EDC's Knutson. "It came down to the cost of doing business. You are going to have to do that exercise again."

Just like last time, she sees the southeast United States as this state's prime competition. She said the state should push workforce training, expanded tax breaks and other indirect incentives.

"It's ours to lose," said Knutson. "We have to fight for it. ... This may be the first warning call."

WTO stuff if you ask me.

On the Topic, now are the hard times that most expected. Few really had started believing it would all be a dreamlike Dreamliner process. It a complex new aircraft with critical technology outsourced. There is no guarantee whatsoever things wouldn´t have gone wrong if all was build in the US. Maybe critical technology from abroad couldn´t have been implemented and the 787 would have become overly expensive..
"Never mistake motion for action." Ernest Hemingway
 
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Stitch
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 8:59 pm

I wonder if the problems getting the A380 and the 787 out the door could make airlines...nervous...about the A350?

Not because they expect Airbus to "mess up again", but just that these programs are so large and so complicated that "odds" just don't favor the A350, which will itself incorporate new technologies and construction processes, sailing serenely along the Critical Path?

Might this help, rather then hinder, the prospects of the 777 in the near-term as airlines "hedge their bets" by buying a "tried and true" platform, as many have recently done with the A330?
 
Rheinbote
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 9:06 pm

The positive aspect for Airbus is that Boeing is demonstrating the pitfalls of their global outsourcing approach before Airbus could manage to copy it!  duck 
 
StressGuy
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 9:32 pm

I am just glad and a bit surprised that Boeing realized that this outsourcing of engineering (to the extent of the 787) was a mistake and seems to have admitted it. Many of us were shaking our heads from the beginning; hopefully Boeing learned a valuable lesson.
 
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Stitch
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 10:12 pm

Quoting StressGuy (Reply 33):
I am just glad and a bit surprised that Boeing realized that this outsourcing of engineering (to the extent of the 787) was a mistake and seems to have admitted it.

I do not think it was a mistake, especially as we're in the start-up stages.

If the suppliers are still sending empty barrel sections in a year, then it will be a mistake. But I don't think that will happen.
 
texfly101
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 10:20 pm

Quoting Ikramerica (Reply 25):
I believe it's more likely that a 90-140 seat successor to the MD80/731/2/5/6 could be built as a true joint venture between Boeing and a Japanese firm(s), while a 150-250 seat 737NG successor would be a Boeing product, with a major Japanese company as a partner, but with major work being done in Washington and Oregon, with possibly only wings and stabilizers being shipped from Japan or England

 bigthumbsup  he's got my vote

Quoting NYC777 (Reply 26):
These sections certainly cannot be transported on a LCF like the 787.

That's why they had the Everett dock enlargement as a part of the WA State concessions. That wasn't for the 787, it was for the larger structures like a redesigned composite 777 wing maybe? or a composite 747-8F wing maybe?

Quoting ER757 (Reply 28):
The thing is though, they still have union members doing the assembly and they are just as likely to strike as ever.

That's right and that's why the partners outsourcing strategy wasn't because of the unions. Conspiracy theory advocates will still insist otherwise but it was a simple fact that there was a pre-bid limit of the prices. Don't meet it, don't bother to submit a bid. It was that plain and simple. The partners that signed up for the tab got the contract.

Quoting ER757 (Reply 28):
And if other unions at Boeing strike (SPEEA for example), the unions that support the 787 assembly will walk out in sympathy as well,

Look at the last negotiations and see if SPEEA supported the IAM strike with their feet. I wouldn't count on SPEEA striking nor would I count on any sympathy walkouts.
 
nuggets
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 10:49 pm

I work for a major consumer electronics company (based here in the US) and I remember when we switched to outsourcing our product manufacturing overseas. It was a mess at first. Issues with language, culture, common documentation formats, and systems. We've now been doing it for a few years and things have gotten much smoother, but it still requires a considerable amount of effort in terms of supervision. Even with the effort, it still appears to be less expensive than running our own factories in the US like we used to.

I wonder if Boeing is going through similar growing pains.
 
sphealey
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RE: Former 787 Chief Disses Supply Chain

Thu Nov 01, 2007 11:08 pm

> I do not think it was a mistake, especially as we're in the start-up stages.
>
> If the suppliers are still sending empty barrel sections in a year, then it will
> be a mistake. But I don't think that will happen.

The question being, did Boeing set a mildly unrealistic schedule to keep everyone's nose to the grindstone - a not-uncommon management and project management technique? Or were they actually surprised by the difficulties and schedule slips they encountered? If the former then there is no fundamental problem. If the latter the situation is a bit more dangerous.

IMHO the key checkpoint will be first flight. I believe Boeing have announced it will be in the February timeframe. If they actually get in the air in December/January ("early" by the revised schedule) then that will be a signal things are probably on track. If the first flight slips again you can draw your own conclusions.

I would recommend reading Joe Sutter's 747 book. A lot of bad things and schedule slips happened on that project too. But that time management's attention was fully focused on the SST project and supporting NASA's Apollo 1 recovery effort so no one paid too much attention to the "obsolete technology project" over in the remote buildings. Sutter essentially said that if the spotlight had been focused on the 747 it might never have finished. But once it was finished it took off (so to speak - ha ha). So these kinds of problems are not unusual.

sPh
 
tdscanuck
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 12:45 am

Quoting Abba (Reply 2):
Secondly it seems as if they lack skills in managing such diverse supply chain as they have build around the 787 program

Of course they do. There has never been as large or diverse a supply chain as the 787 in any industry anywhere...*nobody* had these skills. After the dust settles, Boeing will be the only one that does have them.

Quoting Keesje (Reply 7):
Boeing is learning hard lessons about outsourcing so much 787 design & production.

Of course this has been denied for yrs,

Who denied that they were going to learn hard lessons?

Quoting PolymerPlane (Reply 9):
What surprises me most is that Boeing actually asked the suppliers to design the parts for them. I do not think this is a wise idea.

1) Boeing is *far* too small to design all the parts in an airplane.
2) Boeing has had suppliers designing parts for decades (at least back to the 707, probably earlier). The only difference on the 787 was the degree.
3) Boeing doesn't have the knowledge or experience to design a lot of stuff on an airplane themselves.

Quoting Aircellist (Reply 24):
Could the successor to the 737 be built in Japan?

Nope. US Government would never allow it, among other things.

Tom.
 
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Stitch
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 12:48 am

Quoting Sphealey (Reply 37):
The question being, did Boeing set a mildly unrealistic schedule to keep everyone's nose to the grindstone - a not-uncommon management and project management technique? Or were they actually surprised by the difficulties and schedule slips they encountered?

They have certainly been surprised by what has happened. They've known they have had issues for over a year and have spent much time and money to try and mitigate it, yet they still couldn't get it done.

That being said, I do think the original schedule appears to have been ambitious considering the scale of the program, which leads me to the comment by:

Quoting Tdscanuck (Reply 38):
There has never been as large or diverse a supply chain as the 787 in any industry anywhere...*nobody* had these skills. After the dust settles, Boeing will be the only one that does have them.

 yes 
 
ikramerica
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 1:11 am

Quoting Nuggets (Reply 36):
It was a mess at first. Issues with language, culture, common documentation formats, and systems. We've now been doing it for a few years and things have gotten much smoother, but it still requires a considerable amount of effort in terms of supervision. Even with the effort, it still appears to be less expensive than running our own factories in the US like we used to.

Same for the toy business. It's a balancing act between how much you design in the USA and how much you allow the Chinese factories to "figure out" from your concepts, and there is always a loss in quality with the latter, but you decide what the acceptable loss in quality happens to be to meet the price. And then you hope they don't put too much lead in it...

Same is true in animation. The lower the budget, the more you allow to be outsourced. A premiere Disney or Pixar film may have 90%-100% of work done in house, while a "direct to DVD" disney sequel or the Simpsons has all the work up to the key frames done in the USA, while a cheap cartoon at this point only has story boarding and model sheets done in the USA, with the bulk of the rest outsourced. Again, quality deteriorates the more the design work is outsourced.

So I wonder what happens with an airplane. It's not that the suppliers are inferior minds, but is the lack of direct supervision and control on an hourly basis going to lead to a decrease in quality (in the form of consistency of product and defect rate)?
Of all the things to worry about... the Wookie has no pants.
 
ContnlEliteCMH
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 2:13 am

I don't think that Mr. Bair's public comments about supplier issues are out of order. I'm can only guess, but I wonder if his frustration is not just with performance of these suppliers, but with their reaction to their subpar performance.

A present example with my own career may illustrate this. I have ascended to a position in which I have only one superior in the information technology organization in which I work. Anything related to data or business intelligence is mine. I have inherited a DBA who seems to have deep talent, a large amount of knowledge, and lengthy experience with our company. He's also got a bad reputation among other longer-term coworkersl as well as the internal business customers we serve. And he's lazy. He never seems to do all the work he can and that we need him to do to be successful.

Now, I believe such issues as reputation can be remedied with quality work done with a proper attitude. However, he doesn't work very hard and he actively resists efforts to peer into the quality and quantity of his work. In other words, he behaves badly after his own failures, and this is going to get him fired. I've just grown fed-up with it, and for the money we're paying him, I expect somebody who is knowledgeable and productive. I've only got the former. And it doesn't seem to matter how many times we chat, or how many times he gets written up. He just never improves and he seems to resent any push toward being better. It's almost like it's his... culture. I use that term outside of his race or creed; he's a white American so it can't be about differences between him and me. Culturally, he doesn't ever seem to connect with the concept that he's a screwball and that he needs to do better.

I'm a betting man, so I'd put some money down that a private chat with Mr. Bair would show the same frustration, except that "culture" in this case would have everything to do with heritage and geography. "So my parts are late? And they're of shoddy quality? Who cares?"

We're already interviewing people to replace my screwball. Boeing can't easily do that. They're stuck and the only conclusion you reach is "I'll never use those guys again."

[Edited 2007-11-01 19:18:46]
Christianity. Islam. Hinduism. Anthropogenic Global Warming. All are matters of faith!
 
tdscanuck
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 2:40 am

Quoting Ikramerica (Reply 40):
It's not that the suppliers are inferior minds, but is the lack of direct supervision and control on an hourly basis going to lead to a decrease in quality (in the form of consistency of product and defect rate)?

It shouldn't, since Boeing has outsourced manufacturing of major assemblies for a long time and build quality is primarily a manufacturing concern, not a design one. There are many suppliers whos' built quality meets or exceeds Boeing's.

Outsourcing of component design may result in some worse designs (and some better), but shouldn't have any significant impact on consistency of product or defect rate.

Tom.
 
WingedMigrator
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 2:42 am

Quoting Sphealey (Reply 37):
IMHO the key checkpoint will be first flight. I believe Boeing have announced it will be in the February timeframe.

Boeing said the first flight would be at the end of 1Q08.

I would have to differ with you on your first comment; the key checkpoint is not first flight; it is the large-scale industrialization of the program, as the production rate ramps up, with all the kinks that must be ironed out to get the supply chain running not only smoothly, but at high volume. The key checkpoint will be whether Boeing can deliver 109 frames by the end of 2009, as they are currently promising.

The significance of this figure, 109 frames by 4Q09, cannot be underestimated. The recently announced delay affects flight testing, yes, but Boeing is effectively saying that they can catch up by that date and put the program essentially back on track. Before any delays, the figure was 112 frames by 4Q09, or just about the same number. If the supply chain is indeed the root of the current delays, as Bair seems to say, such an achievement would be downright heroic (IMHO).

Quoting Tdscanuck (Reply 38):
There has never been as large or diverse a supply chain as the 787 in any industry anywhere...*nobody* had these skills.

 checkmark  it's almost too easy for us in the a.net peanut gallery to lose sight of that.
 
GBan
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 5:15 am

Quoting NYC777 (Reply 26):
Well if they're planning to build a large 777/747 successor then those parts (assuming they're going to use the barrell method a la the 787) would be too large to transport along large distances and it would make sense to set up an industrial park where the facilities are in very close proximity to each other to facilitate logistics of the large fuselage sections. These sections certainly cannot be transported on a LCF like the 787.

Mercedes has shown such a concept with the Smart-Factory complex in Hambach. Lots of outsourcing, but the suppliers had to set up their production facilities in Hambach.
 
abba
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 6:57 am

Quoting Tdscanuck (Reply 38):
Of course they do. There has never been as large or diverse a supply chain as the 787 in any industry anywhere...*nobody* had these skills. After the dust settles, Boeing will be the only one that does have them.

However, the learning curve for Boeing is much steeper by far as it would have been for Airbus if they were to do the 787.
 
JoeCanuck
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 7:30 am

Quoting Abba (Reply 45):

...and yet it didn't help them with the 380. In fact, wasn't it, in part, the lack of systemic standardization within Airbus, that led to the 2ish year delay? If they couldn't do it in house on time, it's doubtful that they would have done a better job at coordinating a project like the 787 by outsourcing.

The complexity of major modern projects is so daunting, financially and logistically, that no one company can be expected to be able to maintain and support all the resources needed, indefinitely.

One of the problems with doing it all in house, is that once the R&D is done, what do you do with the staff? Sure, some of them can move to production, maintenance or other projects but not all of them. You can't just afford to have a bunch of resources idle and it's impossible to predict when and where they'll next be needed.

The most critical in A.Net probably haven't had to organise anything more daunting than a morning donut run.
What the...?
 
BrianDromey
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 8:31 am

Quoting Stitch (Reply 17):
The fact is these companies - be they internal like Airbus and the A380 or external like Boeing and the 787 - stated they could meet the need. And yet, in the end, they couldn't. For at least a year, if not longer, Boeing management has been saying the sub-contractors were not meeting expectations, to say nothing of contractual obligations

There are two absolutely different scenarios here. Airbus went along its merry way desigining something that would not fit together, maybe becasue the French went on strike the day the software versions were to be decided, or maybe becasue the Germans were a bit too zealous in updating theirs, or just ignored the bloody French and carried on regardless. There were absolutely no supply chain issues.
Boeing went along its merry way, outsourcing the programme, and guess what, players on the team failed to deliver. It happens. I dont think its unfair to say Boeing was somewhat naieve in its supply-chain management.

Suggesting that the A380 and 787 delays are in any way comparable is absurd, and smacks of lack of cor-ordinated thinking. The are tow very different delays, casued by two very different manifestations of poor supervison and/or management.

Quoting Stitch (Reply 31):
I wonder if the problems getting the A380 and the 787 out the door could make airlines...nervous...about the A350?

Of course the A380 made the airlines nervous, and Airbus descendning into farce behind the scenes did not much help matters. IMHO the jury is still out on the A350 and Power8, to rebuild its reputation and regain credibility Airbus needs to get the A350 out the door with a small to no delay.

Quoting Tdscanuck (Reply 38):
There has never been as large or diverse a supply chain as the 787 in any industry anywhere...*nobody* had these skills. After the dust settles, Boeing will be the only one that does have the

I agree, but Airbus would still have been in a better position to carry out such an extensive chain. Boeing would have had to go that way eventually anyway, and I think the decision made was 100% the right one for the future of Boeing. But more time would have been prudent.

Quoting JoeCanuck (Reply 46):
...and yet it didn't help them with the 380. In fact, wasn't it, in part, the lack of systemic standardization within Airbus, that led to the 2ish year delay? If they couldn't do it in house on time, it's doubtful that they would have done a better job at coordinating a project like the 787 by outsourcing.

Agian, see above, to completely different scenarios.

At the end of the day, no one will care that the 787 is 6 or 12 months delayed. With oil at $100 a barrel, the airlines will be salvating at the mouth. The figures now must look even better than they did whe the 787 was first offered/ordered.

Brian.
 
JoeCanuck
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 8:58 am

Quoting BrianDromey (Reply 47):
Suggesting that the A380 and 787 delays are in any way comparable is absurd, and smacks of lack of cor-ordinated thinking. The are tow very different delays, casued by two very different manifestations of poor supervison and/or management.

Not absurd at all. In the end, neither company was able to get their planes built on time. Airbus couldn't coordinate within itself and Boeing couldn't coordinate resources from their sub contractors. The results are the same; the product is late to market.

The customer doesn't have the product they were promised. That's the bottom line. Does a customer have to care about why? Nope...the customer only has to worry about how the manufacturer will make it right.

The idea that Boeing is somehow more wrong for how their delay happened than Airbus, (or visa versa), truly is absurd. They both screwed the pooch and are paying the price.
What the...?
 
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Revelation
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RE: Former 787 Chief Disses Supply Chain

Fri Nov 02, 2007 11:56 am

Quoting Tdscanuck (Reply 38):
Nope. US Government would never allow it, among other things.

I'm wondering if you'd clarify this. If, for instance, Boeing decided they couldn't make money building the 737 replacement in-house and it was built by a Japanese firm instead, and marketed and supported by Boeing, why and how would this be disallowed?

I really doubt the US Government has much if any willpower to block the plans of any large US corporation. Decades ago we had the breakup of Standard Oil, and then AT&T, and now we see the same entities recombining themselves. without a peep from Uncle Sam.
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