Odds and Ends: 787 Developments on ELT, Production; Frontier as a ULCC

787 Developments: There have been a flurry of developments late Friday on the Boeing 787.

First, it emerged that Boeing’s Charleston plant will not reach a production target of three per month by the end of this year as Boeing repeatedly said. The Charleston Post & Courier first reported the story, and the Puget Sound Business Journal picked up on it Friday.

We weren’t surprised by this because (1) we’d been hearing rumblings for months that progress at Charleston was less than Boeing was suggesting publicly and (2) we got a call from the Post & Courier reporter a week ago perplexed by Boeing’s response when he made inquiries. And to us, this is the most bizarre part of the entire story. Boeing’s official response was quite snarky:

“If anyone was under the impression that Boeing South Carolina would be at three per month by the end of this year, they didn’t understand what we’ve been saying about the surge line in Everett helping us to meet the program-level rate as the facility there comes up in rate. That’s been our message for a long time now,” the Boeing Charleston spokesperson told the P&C and Everett told the Business Journal (via two different spokespersons).

This was really quite a pissy official statement from Boeing.

When the P&C presented Boeing with Boeing’s own statements from last year pledging a 3/mo production rate at Charleston, the Corporate Communications people had to backtrack. Steve Wilhelm at the Business Journal wrote:

But when confronted with Boeing’s own October 2012 release stating that the North Charleston operation would hit three monthly by the end of this year, as well as a 2012 interview with North Charleston site director Jack Jones, in which he said he expected to hit an even-higher 3.5 monthly rate by the end of this year, the Boeing communications team backed down.

After conferring with her colleagues, presumably in North Charleston, [Lori] Gunter (Boeing Everett) issued this statement:

“The 787 program is on track to reach a total production rate of 10 airplanes per month by the end of 2013. This rate will be accomplished by combining the results of the Everett Final Assembly Line, the Boeing South Carolina Final Assembly Line and the Temporary Surge Line in Everett. Boeing South Carolina is expected to reach a production rate of three airplanes per month in 2014.”

This is an embarrassing display from Boeing.

Since the surge line had been put over to rework, we wonder its current status.

Second, The Wall Street Journal, followed by The Seattle Times, reported that Canada’s regulators are about to issue an Airworthiness Directive concerning Honeywell’s Emergency Locator Transmitter; and that there was a part that should have prevent the ELT from overheating in the event of a short circuit.

Seperately:

  • Frontier as a ULCC: The consultancy CAPA has an analysis of the prospect of Frontier Airlines moving even more in the direction of becoming an Ultra Low Cost Carrier than it has already.

Odds and Ends: Bernstein: no 777X before 2020; Alaska, Frontier and Competition; A380 repair costs; Boeing labor challenges

No 777X before 2020: Bernstein Research, in a note issued today, says it doesn’t see delivery of the Boeing 777X before 2020. Also: on a recently completed trip to Asia, Bernstein wrote this:

There’s clearly huge demand for the 787. There was a lot of excitement about it, but Boeing was heavily promoting the 747-8, for which the company is certainly seeking more orders, with few orders for the passenger version and the air freight market being very weak. To date, the majority of orders for that airplane have been freighter orders. This is a relatively small program, but we think it is the most difficult within Boeing’s portfolio right now. …[Y]ou’re probably not going to see the growth that Boeing had once hoped for there. That’s certainly how we have been making assumptions, as well.

Alaska, Frontier and Competition: The Centre for Asia Pacific Aviation has this analysis about Alaska and Frontier airlines, which aside from being a little geographically-challenged, is one of CAPA’s usual well-researched and thought-0ut looks at airlines. (In fairness, CAPA often strays from the Asia-Pacific, but we couldn’t resist the quip.) CAPA now actually calls itself Centre for Aviation.

A380 Repair Costs: Aviation Week has this article detailing the costs to Emirates Airlines for repairs to the Airbus A380 wing bracket cracks.

Boeing Labor Challenges: Boeing seems headed for war again with labor unions. Here’s an article from The Everett Herald with several links within it; one from MyNorthwest.com about SPEEA; and one from The Seattle Times about SPEEA.

Cargolux and Qatar: We posted some news about Cargolux and Qatar yesterday; The Seattle Times has this piece about the threat to the Boeing 747-8F from Cargolux’s problems.

Odds and Ends: Sharklets, CAPA analyzes the Middle East

A320 Sharklet: Jon Ostrower has a detailed piece about the wing work needed to retrofit the A320 with sharklets and some thoughts about what this means for the neo.

Dubai Air Show: The Center for Asia-Pacific Aerospace (CAPA) does an analysis on the orders placed at the Dubai Air Show and what these mean. CAPA has a couple more links within the article that are worth clicking. One link is about Bombardier and its CSeries progress.

Middle East: More on the region: Bloomberg has this report in which Emirates Airlines is considered a safer investment than the sovereign risk of Dubai.

Bernstein Research, meanwhile, issued a note today (Nov. 28) on the Middle East. It writes:

Long term strategies at Boeing and Airbus for long haul aircraft need a special focus on Middle East airlines. We see growth at the big three Middle Eastern airlines (Emirates, Qatar, Etihad) as a trend that will not end any time soon and will come heavily at the expense of European and Asia-Pacific airlines (e.g. Lufthansa, Air France, British Airways, Thai, Singapore, Qantas). The big three airlines are all now among the fifteen largest long haul airlines in the world in terms of widebody fleet plus backlog (Emirates is the world’s largest and Qatar the third). Compared to other regions, the Middle East is an outlier in that planned fleet growth is much larger than could be justified by the region’s GDP growth alone. But, this fleet growth is all about acting as a “sixth freedom” hub for long haul traffic, particularly connecting the Asia-Pacific region with Europe and Africa.

Pratt & Whitney: Time magazine named the GTF one of the top 50 inventions in 2011. The Montreal Gazette has this take on the Time honor. (We’d link directly to Time’s article, but it is for paid subscribers only at this point.)

Air India: The airline is now apparently planning to sell its new Boeing 787s and lease them back, thus neatly avoiding the controversy over export financing.

Boeing Wichita: News broke last week that Boeing is studying closing its Wichita operation, which is dedicated to military business. With the defense budget under attack, Boeing is finding it hard-pressed to keep Wichita open, according to news reports. The news sent Kansas politicians scurrying and set off some irate comments because Boeing promised Kansas 7,500 jobs in the KC-X tanker competition if it won (as it did). The politicians say Boeing promised Wichita the tanker finishing business and it better keep its promise. The Wichita Eagle has this latest article, which also has some interesting history of Wichita’s role in aerospace.

KC-46A Tanker: Speaking of the tanker, DOD Buzz and Bloomberg News have reports that Boeing is likely to lose money on its initial contract with the tanker. This is not particularly new; this was first reported earlier this year. But the amount has grown from a $300m loss to $500m on a $4.8bn contract.