Putting perspective on the 787

Update: The Wall Street Journal has a long article (subscription required) discussing the problem and the possibility the FAA could release the 787s for service if it approves interim steps designed by Boeing. It also has this illustration:

 

Original Post:

The grounding of the Boeing 787 by the US Federal Aviation Administration wasn’t entirely unexpected, based on discussions we had in the last 48 hours with people in the US and in Europe.

Although the FAA did not pull the Airworthiness Certificate of the airplane, the grounding had virtually the same effect.

Airlines throughout the world followed suit and some of the regulatory agencies followed the FAA lead.

We’ve been inundated with media calls asking about the ramifications. Here’s a synopsis of the questions and our responses.

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American Icon: Saving Ford and Alan Mulally

We just finished the new book, American Icon: Alan Mulally and the Fight to Save Ford Motor Company. It is well worth reading.

There’s very little about Mulally and his time at Boeing, though there are lots of references. The most extensive discussion is Chapter 3, The Man on the White Horse, in which Ford CEO William Clay Ford Jr. approaches Mulally to leave Boeing and the process Ford–and Mulally–went through for his decision-making.

Part of the process was the interaction between Mulally and Boeing CEO Jim McNerney–and McNerney doesn’t come off looking too good. This may not be particularly surprising, since the story is told from Ford’s and Mulally’s viewpoint and is not a deep look into the Boeing side of things. But this examination is nonetheless interesting. This is a big omission, but the machinations reported are insightful.

But the main event–the crisis Ford was facing when Mulally joined, and how he built a team to deal with it–is fascinating reading. It makes you wonder how different things might have been on the troubled 787 program had Mulally been here as things went south, with his applied management tactics that were very different than the atmosphere widely discussed among employees once Mulally left. This atmosphere, employees said, punished bad news rather than rewarded honesty and candor, and Mulally’s successor, Scott Carson, simply didn’t have the technical background to cope with the 787′s growing challenges.

The author, Bryce C. Hoffman, was the automotive reporter for the Detroit News. He gives a candid look at some of Mulally’s errors, but by-and-large this is a story in which Hoffman paints a picture in which Mulally can do little wrong.

Is he a fawning story-teller or do the results speak for themselves, driving the story to its constant pat-on-the-back approach to Boeing’s refugee? We think largely a results-story. At the end, Hoffman gives credit to those who also had a hand in saving Ford, but almost as an after-thought–except for Bill Ford himself, who realized he didn’t have the depth or experience to do the job himself and set aside his ego and family legacy to bring in Mulally.

AA plans 767 retirement from about 2015–does this mean 787 order will finally be firmed up soon?

American Airlines announced that it plans to retrofit Boeing 777-200s and half its Boeing 767-300ER fleet with lie-flat business class seats as a means to upgrade its international service. AA also announced that it plans to retrofit only half of the 767 fleet and retire the rest.

IAM 751 Tweets that the retirement will start about 2015.

Does this mean American is preparing to at long last firm up its MOU for up to 100 Boeing 787s? The MOU was made several years ago, but was never firmed pending resolution of pilot contract negotiations. This, of course, hasn’t happened, and now in bankruptcy, American is moving under Section 1113 of the bankruptcy code to void the contract (and other labor agreements) and to impose its own terms.

This fleet upgrade and retirement announced suggests to us that American might be nearing a resolution (under 1113 if nowhere else) that will lead to firming up the 787 order.

No wonder Jim McNerney favors an American solution to a US Airways merger.

How many 787s will Boeing deliver in 2011?

787 in bigger trouble than thought: Seattle Times

Update, December 21: Flightblogger’s piece (referred to in the Dec. 19 update below) is now up: The price of the 787 sales success.

Original Post:

Dominic Gates published this story for the Sunday Seattle Times; it’s not good news for the 787.

Update, Dec. 19: There is more to come, this time from Flightblogger in the next day or two.

Boeing: 787 fire caused by FOD, design changes coming, no word on delay

Boeing issued this press release at 3pm PST Nov. 24:

Boeing Initiates Changes to 787 Power Panel, Updates to Software

EVERETT, Wash., Nov. 24, 2010 – Boeing [NYSE: BA] is developing minor design changes to power distribution panels on the 787 and updates to the systems software that manages and protects power distribution on the airplane. These changes come as the result of what has been learned from the investigation of an onboard electrical fire on a test airplane, ZA002, earlier this month in Laredo, Texas.
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Our 787 forecast: 4-6 month delay

Update Nov. 22: Bloomberg News has this report detailing the source of the FOD.

Original Post:

It’s become a worldwide sport, trying to forecast how long the widely expected delay from the in-flight fire of Boeing 787 ZA002 will be.

Morgan Stanley predicts the first delivery of the 787 to All Nippon will slip from February to 2012. This is the most dire prediction.

Here’s ours, and this has several elements to it. Everything that follows is based on numerous conversations with many sources who have knowledge of events.

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54 failures on QF A380

The Associated Press, via this story in The Seattle Times, details the in-flight emergency of the Qantas A380 after the No. 2 engine suffered an uncontained failure.

The account is very dramatic, particularly when the as-yet untold story of the Boeing 787 ZA002 is considered.

Qantas recorded 54 failures, including the near-deployment of the Ram Air Turbine (RAT) that does so only when there is a major system failure. The RAT, as we know, deployed on the 787.

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Boeing repositions two 787s, probe continues

Update, Nov. 17, 4:30PM PST:

This article from Europe talks about efforts by Safran group to acquire Zodiac, which is a supplier on the Boeing 787. The article refers to possible interest (or lack of it, actually) by Hamilton Sundstrand as a potential bidder for Zodiac and that Zodiac is a competitor to Sundstrand.

As it happens, a company called ECE is subcontracted by Sundstrand on the P100 control panel on the 787, where the fire originated on ZA002. ECE is a subsidiary of–Zodiac.

Update, Nov. 17, 9:00 AM PST:

Heidi Wood, the aerospace analyst at Morgan Stanley, issued this brief note today:

What’s new: Yesterday, Boeing issued a press release update on the 787 highlighting the ongoing investigation into the test flight fire incident. While test plane ZA002 remains in Texas, 2 other 787s (ZA001 & ZA005) have returned to Seattle until a resolution can be determined.

What Does This Mean? Our read-between-the-lines interpretation of the press release:

(1)Boeing: “Boeing has established a plan to fly two aircraft back to Seattle.” “No decision has been reached on when flight testing will resume.”

Translation: The other planes (may) have an issue too. Which suggests 2 things: 1) it’s unlikely flight tests will resume shortly (days, a week), 2) bringing test planes back means it’s not de facto a quick fix. We estimate flight test resumption in late December, early 2011.

(2)Boeing: “The incident demonstrated many aspects of the safety and redundancy in the 787 design, which ensure that if events such as these occur, the airplane can continue safe flight and landing”.

Translation: The vagueness alerts us, as it sidesteps claiming the systems all worked. This tells us the multiple redundancies may not have performed as they should have, which dovetails with what our sources have been asserting. We’re impressed by the honest admission; we believe this is an FAA chief concern.

(3)Boeing: “We must complete the investigation and assess whether any design changes are necessary.”

Translation: Design changes are necessary. Questions arising about software, hardware redesign extend the horizon & could push first delivery to 2012.

(4)Boeing: “Until that time, BA cannot comment on the potential impact…on the…program schedule.”

Translation: Delay ahead. They just don’t know how extensive yet to set a new, credible target. When they do, they’ll officially announce the next delay.

Original Post:

Boeing just issued this update on the 787 program:

EVERETT, Wash., Nov. 16, 2010 – While the investigation into the incident onboard 787 Dreamliner ZA002 continues, Boeing has established a plan to fly two other aircraft, ZA001 and ZA005, back to Seattle from Rapid City, S.D., and Victorville, Calif. The U.S. Federal Aviation Administration has reviewed and approved the plans.

ZA001 was undergoing refueling in South Dakota when the incident on ZA002 occurred and the company decided to forgo additional flights. ZA005 was on remote deployment for testing in California.

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Updates on Airbus, Boeing events

Aviation Week has this long and detailed story about the Airbus A380/Qantas engine failure.

Qantas A380s remain grounded indefinitely.

KING 5 (NBC, Seattle) has this account of the Boeing 787 fire.

KIRO TV (CBS, Seattle) has this item about the FAA and the 787′s certification tests.

Flightglobal reports an FAA pilot was at the controls when the 787 fire broke out.