737 program chief talked about Renton production site

With the rhubarb that emerged from the Boeing 2Q earnings call over where the 737RE production will be, and the contradictory messages to come from Boeing Commercial Airplanes (BCA) in Seattle and Boeing Corporate in Chicago, we thought it might be useful (and certainly interesting) to return to the Boeing pre-Paris Air Show press briefing by Beverly Wyse, the Vice President and General Manager, 737 Program.

During the briefing, the question of potential 737 production rates came up. Boeing has announced a rate of 42/mo from 2014 and even then there was discussion of taking rates to 50/mo. Since the Air Show, BCA CEO Jim Albaugh said the company is studying a rate of 60/mo. It was within this context that the question over production was asked.

Wyse’s comments at the press briefing are noteworthy on a couple of points.

Wyse said:

  1. Renton has the room for a full, third 737 production line;
  2. Renton has the capacity to produce 63 737s a month (two 737-based P-8A Poseidons are included in this number);
  3. There were (on June 2-3) no plans to move the 737 production anywhere else;
  4. You could put a third line at Renton, “but would you? Or would you look somewhere else?”
  5. There isn’t a “significant” investment required for a third assembly line.

Here is the transcript from the recording of that presentation:

Question: How much capacity is there in Renton to build airplanes. What kind of rates could you achieve?

Wyse: It’s an interesting question. Each one of our final assembly lines (FAL) can produce 21 [a month]. The FAL is not a significant investment. If we were to bring another FAL over on the P-8 line, we could imagine we could address that demand fairly significantly. We have demonstrated we could go to 63 a month. [Emphasis is Wyse’s.]

You absolutely could [put another line in Renton]. The question is, would you? Or would you look at putting it somewhere else?

You could do mixed commercial and P8 on Line 3.

We have no plans right now to move our FAL off this production site. Maybe if when we originally started this program we had a vision of what production levels we would be at, we might have made a different decision, would you put all of this production on this site, but we have been so successful with this employee base. You never say never, but it’s not something seeing or studying now.

At the Paris Air Show, we interviewed Pat Shanahan, who heads all airplane programs for Boeing, and he, too, said there is room at Renton for expansion.

Boeing CEO Jim McNerney told analysts on the call said “major investments” are required to add another line at Renton, but did not define this (nor did Wyse when she said no “significant” investments are required).

Thus, the situation remains as clear as mud.

13 Comments on “737 program chief talked about Renton production site

  1. Let’s see… GE guy #1 (coincidentally, the “jobs czar”) plans to completely offshore GE’s imaging technology (x-ray, CAT, NMR) business, now (former) GE guy #2 makes like “ABR” (anywhere but Renton) is s oood spot for a Boeing FAL… Can we connect the dots yet? And where’s Chainsaw Al when he’s most needed?

  2. I see it as one of 2 things:
    1. Boeing really does not have a clue as to what they are doing, what they need to do, nor how to do it. To top it off, they cannot seem to agree amongst themselves as to what they should be communuicating to the public, the market, to their employees and to their customers.

    2. They have some blindingly brilliant plan to reverse all of this in one, quickly timed, fell swoop. Maybe secretly all along they have been developing the BWB, Sonic, Twin Aisle, NSA (BS-TANSA?!) and are much closer to launch and definition than they have let on. Needless to say, it will have an EIS only a year or so after the A320NEO EIS.

    [Edited remaining remarks as violating Reader Comment rules.]

    • What ?about? a production site in Europe or Asia?

      Forget it.
      US style management and Euros are incompatible.
      Even the plants they buy in perfect working order are run down
      in no time if they let US managers off the leash.
      No idea about Asia. McD tried that, right?

      You need to have perfectly understood and then planned the manufacturing task
      you want to offshore. Imagine the Tianjin plant planned, built and managed by Boeing.

  3. The differences from Wyse’s remarks seem to be that McInerney is saying that the 737RE investment will be larger and that building it some place other than Renton is an open possibility. I thought it was very interesting that McI mentioned Renton’s “competitiveness” with other places as one factor that B would consider. Maybe his words have are meant for the union’s NLRB suit to force B to put a second 787 line Puget Sound region, the message being, “If B uses bases its decision on lawful grounds (ie not based on strikes and other union proper exercise of legitimate labor rights, and talks instead about all the legitimate production costs/issues any company would normally consider), B can move 737RE any where it wants and there is nothing the union can do about it, so why not drop the suit and keep the RE AND 787 surge lines in NW Wash?”

    Another reason for McI remarks may be that B is planning major changes to the 737RE in addition to engines. These could include a new wing which might give the RE performance equal to or clearly better than the neo with the LEAP X only. B might also lenghthen the RE’s landing gear to allow GTF use, either with the current wing or as part of a new one. With a new wing and GTF capability, the RE would become a kind of 797 lite, and would make sense if the production lives of the RE and neos were at least 15 years from first delivery or more; ie that B felt that A would not do its own NSA before 2030, as they have been saying.

    I know this seems like a long shot, but it is consistent with B’s need to protect mkt share not only against the neo but also the C Series and similar competition soon to arrive. One thing AA’s order teaches for sure is that this narrow body mkt will be huge over the next 15-20 years not only because of escalating pax demand, but also because airlines will be moving to large single aisles to replace bigger twin aisles as a way to reduce fuel costs. B will fall behind in this mket if they do not do more than re-engine.

    In addition, doing more than re-enginning squares with McI’s remarks to the effect that there is finally light at the end of the 787’s tunnel (hopefully the light is not an on-coming locomotive), Albaugh’s claim a while ago that B have trained 18,000 engineers and need something for them to do, and EIS of 2017 not the neo’s in late 2015. Problems include whether B can ramp to 60/mo if they do more than re-engine, and whether their contract with CFM allows them to use the GTF.

    The main problem of course is whether B deliver anything on time that is more complicated than a up-dated Wright Flyer. I will not comment on this because I know Uwe wll step right in first chance he gets.

    • “.. more complex than a Wright Flyer ..”

      couldn’t resist, could you 😉
      .. This is not quite my position.

      I have the impression that Boeing is quite challenged with setting up a new project
      from scratch. All the little iterations of tweaking a bit here and there stuff on the other
      hand seems to (still?) work rather well.
      This is endemic ( one of the FlightGlobal writers presented this a couple of days ago
      taking reference from a range of MIL projects ).
      Oversupply of cubicle workers and a lack of engineering cum management talent with
      a holistic view. ( That means immersive competence and not topic surfing talent 😉

      Now, currently predicting Boeing to flounder is easy ( so I do take up the low achievement part here ;-).
      Predicting when they will be on top of their issues is a much more difficult task.
      Not having TopBooms clairvoiance I find this excruciatingly difficult.

      @Tom: you are too harsh.

  4. How come is always the same people posting and kind of saying the same nonsense after each article posted here. Is airliner.net down or something that we have to constantly read the same “experts” time after time. Right now, it is useless to read comments here when it just pretty much a repetition of a previous one by the same poster. Amazing!!!

    • Tom, I whole heartedly agree with your comment. Looking at some of the continuous nonsense comments on this site, it appears that some “participants” found a home here which they couldn,t find elsewhere. I believe this site should take this as a “do something about it” message!

  5. Lots of room in France to build a new plant and don’t forget to think METRIC when retooling i hope Mcboeing trained the 18,000 engineers in the metric way or they will have another coc-up as they did on the 787 delayliner designing a aircraft on U.S.A superdoper computer in A/F mode and then converting in to metric DON’T WORK. I know that as i have owned british m/bikes jap/bikes us/bikes and i need three differnt set’s of tool’s as it’s B.S.for uk bikes A/F for US bikes and METRIC for the jap bike

  6. +++++++++++++++++++++++++ BREAKING NEWS ++++++++++++++++++++++++++

    Asiana Air Boeing 747 Freighter crashes in South Korea Waters with 2 crew members on board

    Build year of the B747-400 aircraft was only 2006 (less than 5 years old)

    Asiana Airlines Inc., South Korea’s second-largest carrier, said the crash of its cargo freighter in the sea south of Jeju island earlier today caused 200.4 billion won ($190 million) of damage.

    The Boeing 747-400 aircraft was carrying two crew members and 58 tons of cargo to Shanghai from South Korea’s Incheon International Airport before problems with the controls, the airline said in an e-mailed statement. The cost of damage is based on the book value of the plane, the carrier said in a separate regulatory filing.

    The plane was heading for Jeju when communications were cut at 4:11 a.m., about an hour after takeoff, Asiana said. Rescue workers are searching for the crew members and the airplane’s black-box flight recorder, which may help determine the cause of the accident, the Ministry of Land, Transport and Maritime Affairs said. The airline shares fell the most in more than four months in Seoul trading following the crash, its first since 1993.

    “The crash may damage Asiana’s reputation if the airline is found to be responsible,” said Kang Seong Jin, an analyst at Seoul-based Tong Yang Securities Inc. Insurance will likely cover the lost cargo and plane, limiting direct costs, he said.

    h t t p://www.bloomberg.com/news/2011-07-28/asiana-boeing-747-freighter-crashes-in-korean-waters-correct-.html

    Bloomberg/Tong Yang Securities are already trying to blame the airline, whereas there is still not the slightest insight available regarding the cause of the crash. There are more balanced reports available, but not in english. One of them hints at possible problems with a delicate freight, as there was a payload consisting of fluid chemicals and lithium batteries on board.

  7. I’ve made some inquiries, and gotten back some emails from BA emloyee aquaintances in Renton.

    They are somewhat non-plussed by Mcnerney’s statement. They just see it as typical worker-baiting they have come to expect. They are universally pessimistic about the next contact negotiation, having little hope that BA will negotiate a square deal, and see another fight looming, which it is hoped (but not thought likely) will be limited to a war of words.

    Wyse sent out a notice to all Renton employees in a somewhat vague and wordy attempt to prevent a panic which isn’t taking place anyway. BA commercial management seems more upset than the rank and firl by McNerney’s quite unnecessary thumb in the eye directed at the IAM.

    One said: “if they want sixty, we’ll build sixty. If they want zero, we can do that too”.

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