Leeham News and Analysis
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Leeham News and Analysis
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- Production increase delays hurt Airbus costs December 2, 2024
- Books to consider for Christmas November 29, 2024
Paris Day Four: Air show winds down as Spirit strike looms over industry
By Bryan Corliss
June 22, 2023, © Leeham News – The business portion of the Paris Air Show wound down today, with no new orders and news of a looming strike in Kansas that will soon grind Boeing aircraft production to a halt.
It was a stark contrast to the high pre-show expectations. Some analysts were projecting we’d see between 2,000 and 3,000 new aircraft ordered this week in Paris. By our count, there were 1,084 – a sizable haul no doubt. However, 970 of those came from IndiGo and Air India, who had telegraphed their plans to place those orders before the show, and used Le Bourget as a backdrop for signing the papers.
The rest of the orders amounted to Boeing and Airbus announcing solid, but unspectacular, deals with a handful of other airlines and leasing companies.
Our colleagues on the ground in Paris reported real excitement around the chalets and exhibit halls, after the long disruption of the Covid-19 pandemic.
But much of the talk at Paris centered around efforts to bolster shaking supply chains – and that was before the strike vote at Spirit roiled the industry.
- Wichita update: Pickets go up Saturday
- Electric aircraft gets second launch customer
Strike to start Saturday; no word of talks
Picket lines will go up outside Spirit’s Wichita factory at 12:01 a.m. Saturday, the headquarters of the International Association of Machinists & Aerospace Workers announced this morning.
Wichita Eagle photo
That said, work already has stopped at the factory, with Spirit telling union-represented workers last night that they shouldn’t report to work Thursday. They will get paid as if they worked today, the company said, but all overtime is canceled.
Wednesday night’s strike vote came after “13 years without a fully negotiated accord and years of working to keep Spirit AeroSystems a player in the game,” the union said. IAM headquarters said officers with Local 839, which represents workers specifically at Spirit, and District 70, which represents workers across the Wichita area, will “regroup and begin planning the following steps to bring the company back to the table.”
Spirit, for its part, reiterated that it respects “the rights of our represented employees,” and added “we look forward to continued meetings with IAM leadership.”
Neither side, however, is saying when or where any new talks would take place.
Boeing would particularly be affected by a long walkout. Spirit supplies 70% of all 737 aerostructures, and it builds the forward sections (the 41 section in aerospace jargon) for all Boeing aircraft.
Spirit also supplies parts to Airbus, but most are made at plants outside Wichita that aren’t affected by the labor dispute. Some deliveries of A220 parts will be affected, however.
The dispute calls into question Boeing’s plans for increasing rates on its 737 and 787 lines this year.
The Seattle Times reported today that Boeing Commercial Airplanes Chief Stan Deal sent a message to workers Thursday morning asking them to remain focused on building airplanes and promising to keep them apprised of developments.
New Zealand carrier launch customer for electric plane
One of the few announced orders on Thursday was for an in-development 44-seat electric aircraft.
Maeve Aerospace image
Dutch manufacturer Maeve Aerospace announced that Air Napier, a New Zealand charter carrier, had placed an order for 35 Maeve 01 electric aircraft and would become a second launch customer for the plane.
Maeve said New Zealand was a “happy hunting ground” for electric aircraft manufacturers, given its geography and eco-friendly attitudes.
Maeve is aiming for a 2030 entry into service for the plane, which is designed for a range of 550 km (340 miles).
A golden opportunity for Boeing to clean up the stored accumulated MAXes from the last few years…👍😉
Assuming that anyone wants to buy them.
They’re 3+ years old, and have been stored outdoors in a cool, wet climate.
Those 2 lessor 787s that were recently scrapped were stored for 2 years at Prestwick: scrapping them cost less than trying to undo the mess that arose during storage.
Bryce.
Those 2 early 787s had endless engine issues and were basically grounded as inoperative because of it. The fact that they were broken for spares indicates that the spares themselves were well preserved as they were in a yellow taggable state. This shows that that the aircraft suffered no ill effects from environmental decay. Furthe the lessor chose to convert the aircraft to spares taking advantage of being able to set the market price for them as these 2 birds were the first 787s broken down to provide a non Boeing parts source….. BA and the industry as a whole is well versed at long term storage of aircraft and your premise that the a cold damp location caused damage to the point that the aircraft were scrapped is incorrect.
Well said, thank you.
@ Scott Correa
From the link:
“The two Dreamliners, original registrations LN-LNA and LN-LNB, ended up being exposed to the weather in a region known for cold and humidity, a condition that is not suitable for preserving aircraft.
“With no interest in reactivating them, the two Boeing 787s were condemned to become parts stock for models of the type that are in activity.”
https://www.airdatanews.com/why-two-brand-new-boeing-787s-are-about-to-be-scrapped-in-scotland/
***
We’ve had multiple, detailed accounts of the huge costs involved in de-mothballing stored aircraft…surely you’re read these?
There comes a point where teardown for parts is more lucrative than RTS.
Bryce.
To your point. Your link clearly states that there was no interest in returning these aircraft to service and that there are no spare engine parts available. Nobody wants them, The article also says 95% of the spares in them are recoverable, which is above the industry average for parts recovery which indicates the aircraft was in great shape, They are also not subject to corrosion as aluminum aircraft are making many of the moisture concerns irrelevant. These 2 aircraft were broken for spares because that was the best way forward to recover the residual value in them. They were not scrapped due to environmental damage incurred during storage. It would serve us all better if you could separate facts from fiction on RTS costs. The bulk of RTS costs lessors must pay are due to the changes in interiors, avionics and livery that the new operator needs to do to get the airplane configured for his fleet. This is quite a bit different from an operator parking his airplane and bringing it back to his fleet at a later date where none of those costs are incurred. Those costs are quite low, and are one of the reasons aircraft parked for extended periods do come back to service. You are attempting to mix reconfig costs, which are quite separate from storage costs into a lump sum to confuse the issue, which otherwise is quite straightforward….
@ Scott Correa
Here you go:
“Qantas CEO Says It Takes 4,500 Hours To Get One Grounded A380 Flying”
https://simpleflying.com/qantas-ceo-4500-hours-get-one-a380-flying/
And that’s just to de-mothball the plane after storage — no reconfiguration of the interior involved. Furthermore: these planes were stored in a desert — not in cool, wet Scotland,
***
And another quote, from Boeing itself:
“Here’s the punch line,” Calhoun said during a recent presentation to investors at the 737 delivery center in Renton, Washington. “It takes as many or more hours for us to prepare an airplane and return to service as it does to assemble it in the first place.”
https://www.nwnewsnetwork.org/transportation/2023-03-08/stockpile-of-boeing-737-max-jets-assures-moses-lake-years-of-work
***
I’m not talking about storage costs, and I’m not talking about re-configuration costs — I’m talking about the costs to make a stored aircraft suitable to fly once more.
I’m not the one here who has difficulty separating facts from fiction 😉
And here’s a link on the two scrapped 787s, with a more explicit piece regarding the deterioration in the aircraft during storage:
“When Rolls-Royce-powered 787s encountered the fan blade corrosion issue in 2019, all 35 of Norwegian’s 787s were grounded. Although some of them have found new life with the likes of Air Europa and recent startup Norse Atlantic Airways, more of these ex-Norwegian Dreamliners are likely going to join the waiting list for scrap.
“This is mostly because of their condition. The two now beginning to be scrapped have been in storage at Prestwick for 4 years, which is quite easily the least ideal place for aircraft storage.
“The main reason behind this is the conditions, aircraft in storage need dry, arid conditions for their lifespan to be prolonged, however, Prestwick and Scotland in general don’t typically see these conditions all that often.
“The inadequate storage location can also be said for the other ex-Norwegian 787s. These aircraft have also been in storage in the likes of Shannon and Prestwick, meaning these jets will likely head for the scrap heap in the not-so-distant future.”
https://aviationsourcenews.com/manufacturer/first-boeing-787-dreamliners-to-be-scrapped/
It’s worth noting that the climate in Washington state — where that MAX inventory is out in the parking lot — is comparable to that in Scotland..
Just to clarify a bit:
1. Calhoun’s remarks included all the work required under the RTS AD for the MAX. The effort to return from simple storage is considerably less.
2. The Qantas remarks about the A380 are for a return from deep storage. They would be less than for the two scrapped 787’s. But neither Boeing’s stored 737 nor the 787 aircraft are in deep storage, they receive regular maintenance.
3. As Scott pointed out, Moses Lake is a quite dry environment, that is nothing like Prestwick. That’s why Boeing stores aircraft there.
@ Rob
“Just to clarify a bit”
– The 2 scrapped 787s were also in “deep storage” — four years, in fact.
– Many of the 737s in inventory are 3-4 years old — take a good look at planespotters.
– Lots of MAXs stored at Paine field — which has an average monthly rainfall of about 7 inches.
Poor attempt at damage control 😏
“But neither Boeing’s stored 737 nor the 787 aircraft are in deep storage, they receive regular maintenance.”
Got a link for that, Rob?
***
Further, “all the work required under the RTS AD for the MAX” is loose change compared to the nightmare set forth by Alan Joyce.
Did you even read the account that he gave?
Again If something I said is factually incorrect, you are free to bring factual evidence to bear. It is correct to the best of my knowledge.
The Boeing stored aircraft are regularly maintained and exercised. That is a far different situation than at Prestwick. A much better climate as well.
Thus the effort required to bring them out of maintained storage is not comparable. Thousands of aircraft went into maintained storage during the pandemic, and brought right back out again.
@ Rob
Again, since you’ve provided zero links to back up what you’ve asserted, one can label everything you’ve said as being “factually incorrect”.
As usual: fantasy presented as fact.
Rob: “deep storage”
ROFL.
The A380 were prepared for storage.
The “Dreamliners” were probably just pushed into a vacant spot.
guess what takes more effort.
undoing planned storage ..
Keep in mind that an A380 has much more relevant real estate.
And another link:
“Reviving aircraft from storage to airworthiness can be an expensive process. The planes were stored in Prestwick, Scotland, a much wetter environment than the Mojave Desert or Arizona. Without a buyer, the salvager EirTrade plans to “reverse engineer” the Dreamliners for scrapping and sale of parts.”
https://www.forbes.com/sites/michaelgoldstein/2023/03/19/ex-norwegian-air-boeing-787-dreamliners-hit-scrap-heap-after-just-ten-years/
@Bryce
Well stated 👍
Good facts.. I like it.
Remember, no one is smarter than Dave Calhoun. Just ask him. 😂
@Airdoc
Thanks!
Always amusing to see the desperate attempts at damage control by the BA Back Office 🙈
@Bryce
He won’t provide a link.
There’s no such thing as ‘deep storage’. It’s termed either, short term – six months or less and long term – more than six months.
Aerospace OEM’s provide technical information for both.
What are you on about? Everyone knows Scotland is a warm, dry, sunny place, no self respecting loch-dwelling monster would reside there otherwise, it’s basically far nicer than Southern California and midge is a total myth intended to scare….
Who am I trying to kid? It can be properly, miserably soggy there, and Prestwick is on the soggier, wetter Western side. Strangely, there are sub-tropical gardens on the coast that side, so it can’t be all bad.
The generalities involving storage of aircraft in damper climates do have some truth however the generalities are based on older conventionally constructed aluminum aircraft which are far more succiptable to corrosion than composite structures. Also, current corrosion preventatives applied in the factory go a long way in preventing salt spray corrosion which is far more serious than fresh water moisture issues. Thats why corrosion inhibitors are salt spray tested, its the most demanding exposure …. Metal airplanes still corrode, but not nearly as badly as they used to…. Advances in coatings, sealants and applied ester based sprays are the pyramid these advances are built on….. Thats the problem posting generalities based on the entire fleet of aircraft as opposed to current production birds which are far more robust
Airdoc wrote
@Bryce
He won’t provide a link.
There’s no such thing as ‘deep storage’.
https://www.lawinsider.com/dictionary/deep-storage#:~:text=Deep%20Storage%20for%20any%20Aircraft,and%20components%20of%20such%20Aircraft
@ Scott Correa
Did you go through your link to find use of the term in the aircraft world?
It’s not there…
I can’t believe the absurdity of the writing above over a couple of aircraft.
Talk about making a mountain out of an molecule.
@Transworld
Considering a 787 goes for somewhere in the ballpark of $125 million a pop, it’s more like a quarter of a billion molecule.
Hi Thomas,
I believe BA is pushing those stored MAX out the door as soon as humanly possible if they can line up a paying customer and all the rework, RTS, certification etc are done properly.
However, I believe rework by Spirit at Boeing facilities are suspended.
I know that this is continents off the subject, but I thought that some of you aerostucture guy’s out there might know the answer. What on earth are they talking about acoustic monitoring for the carbonfbre hull of the submersible Titan? Am I missing some incredibly complex software solution or is this the dumbest thing imaginable?
I’m not getting onto any plane that relies on this tech until I have an answer.
Acoustic monitoring of carbon structures listens for the sound of individual strands of fiber failing in tension. As more fibers fail the actual note shifts lower and you can draw a very exact picture of laminate health by listening to what is breaking and where and mapping the notes and their location
Thanks for that. Still not sure how much use it would be knowing that a pressure vessel is already failing.
I agree with you that a pressure hull in a failure mode is a lousy place to use it. It works far better when you instrument an exemplar part and cycle it through a series of loads/overloads and you develop the signatures for your known structure. As you fly, you listen to the structure and if you hear what you heard on the exemplar part, you know exactly what is going on….
Grubbie:
While the data will come out, my estimate on the dive time has the Titan at something around 8000 feet when it got crushed.
A bit of quick math (I am a certified diver) is ballpark 3500 psi. I am not quite sure how you do the differential calc but its 420 or so. That magnifier difference is no comparison.
No aircraft uses that system and the differential is more like 8 psi so less than 1.0. and of course the action is reversed.
Now think on this, as nutty as it all is, it was successful for years. That is a testimony to CRFP and worth thinking about as a method of future submersibles as the pressure chamber was always the issue with space.
With some good testing you might well come up with a workable design. Part of that would be to go to at least 150% pressure overload.
All the people on board that thing were volunteers, the MAX crashes were tragedies because those people had every right to expect the aircraft to work correctly.
and if you want some head shaking reading, read this one on the Salvage situation on Titanic, truly mind boggling rulings on an illegal ruling that resonate to this day.
https://casetext.com/case/rms-titanic-2
I suspect its all information overload for Bryce who really does not understand stored aircraft (and a number of other subjects but its is interesting.
Another interesting detail.
CEO proudly told lots of people that he had used out of date material from Boeing. Boeing deny supplying it so presumably it came from one of their suppliers. Actually he was probably right, the shelf life is incredibly conservative and you can obviously do test coupons, etc.A lot depends on how out of date it was and storage conditions.
Still, this would be a red flag for me regarding his attitude towards an absolutely critical structure.
@Trans
Being a PADI OWSI (seems like a lifetime ago), that translates to around 243 atmospheres.
You check your dive tables to see how long your bottom time is, at that depth? 🙂
BTW – I knew this guy. He taught me cylinder inspection. He had every cert you can imagine and bought it in 200 ft in sunny, warm Florida, where he taught.
I can’t even imagine 8000 ft and that cold and dark…
https://www.seattleweekly.com/news/in-too-deep/
Another aspect is that a composite submarine hull is in compression, so it’s behavior is different.
There is a lot of experience in composite pressure vessels that are in tension, but not much for applications in compression.
This why composites have not been widely considered for deep submersibles. James Cameron has talked about this at length. He dismissed a composite hull in his own vehicle.
Continuing with your observations…….. The only thing holding a cfrp laminate together in compression is the interlaminar shear value of the matrix. The ability of the glue to hold onto the fibers and react the load through the laminate using only the matrix allowables for compression is misunderstood by many. In compression, the glue alone carrys the loads. Its a bad practice. We also need to add the cold soaking of the vehicle to the list of suboptimal conditions
Yes, completely agree.
Another issue coming to light is fatigue cycling. The Titan diving depth was derated from 4000m to 3000m, due to cyclic fatigue.
The thing about fatigue is that it’s going to continue with use. So if the vessel had to be derated after a number of dives, that loss would be continuing with each dive.
Rush may have done a projection based on that derating, to determine that he still had some margin. But the relationship may not be linear.
This happened to the Virgin composite deep submersible, they realized it would have a fatigue life of one dive. At which point, it was obviously abandoned.
Interesting that fatigue cycling is mentioned here, since that’s the issue ultimately underlying the shimming debacle on the 787.
An improperly shimmed joint has a compromised ability to elastically absorb the shear/torsional forces experienced during flight, hence shortening the MTBF. Effectively, the service life of the plane is shortened, which affects secondhand/leasing value.
Rob.
With respect to the derating of the Titan. It is a completely new quagmire when you start using statistical measures to monitor a universe of variables when the population is 1. All your decisions are then suspect.
Bryce, you are correct about the 787 and fatigue life. That’s why the repairs restore the original life.
However the cases are eons apart in severity. The Titan was severely stressed by under 100 dives, and the cyclic fatigue compromised it’s strength, below the limit load.
A 787 has a design life of 66,000 cycles (200,000 hours) and the join gap fatigue contribution is not capable of compromising it’s strength below limit load. In fact it’s strength remains near the same ultimate load.
But you are correct that there is some loss of fatigue life, until the aircraft is remediated. Exactly how much, is not quantifiable yet.
We’re not talking about “severity”, Rob — we’re talking about the basic phenomenon of cycle fatigue.
Although, when BA gets the ultimate bill for inspection, repair and/or scrapping of the affected 787s, the financial effects may prove to be very severe indeed 🙈
And I already know that I’m correct — I really don’t need to hear that from you 😏
“A 787 has a design life of 66,000 cycles (200,000 hours) and the join gap fatigue contribution is not capable of compromising it’s strength below limit load. In fact it’s strength remains near the same ultimate load.”
How about when there’s a combination of manufacturing issues in the join?? Isn’t that one reason why BA was forced to ground a bunch of them which were just delivered in the summer of 2020?
@ Pedro
You’re not allowed to be realistic here!
You’re only allowed to quote from the official 787 brochure, and from BA’s PR manual 😉
Rob likes to tell us about the *design* specs of the 787 — but he omits to discuss the fact that those *design* specs weren’t met due to *production* screw-ups.
For example:
(1) “…sources familiar with the matter noted that the area of the structure cannot withstand the maximum stress while flying, putting the area at risk of failure.”
https://www.aerotime.aero/articles/25764-boeing-787-aog-aft-fuselage-issue
(2) ““This proposed AD was prompted by reports that shimming requirements were not met during the assembly of certain structural joints, which can result in reduced fatigue thresholds and cracking of the affected structural joints,” the FAA explained. “Not meeting the shimming requirements during assembly of the [affected structure] results in excessive pull-up forces, fastener shanking, excessive burr heights in metallic members and the presence of metallic chips (foreign object debris) in fastened interfaces, which all degrade fatigue performance of any affected structural joints,” the agency added.”
https://aviationweek.com/mro/aircraft-propulsion/faa-draft-mandate-targets-boeing-787-shimming-issue
Thanks @Bryce.
Oh my.
-> Affected aircraft would need repetitive high-frequency eddy-current inspections, the draft AD said.
Does it look like it’s business as usual?? 🙄
-> “We have been trying to determine a door removal and inspection approach to see [if we can] plan a nondestructive inspection method to determine what we need to do going forward.”
https://www.seattletimes.com/business/boeing-aerospace/faa-memo-reveals-more-boeing-787-manufacturing-defects-including-contamination-of-carbon-fiber-composites/
Bryce and Pedro said…….
“You’re not allowed to be realistic here!
You’re only allowed to quote from the official 787 brochure, and from BA’s PR manual 😉”
Thank God Im not doing that…. I avoided getting moved to the 787 program by flat out telling people I wasnt interested in building tupperware airplanes. The crux of the 787s issues stem from the fact that it is an OML tooled airplane. This makes the joins difficult as all the shimming gets back driven into the circumferential splice fasteners. When you are building a structure that is inelastic in tension, the fastener installations must be made correctly. BA did a craap job of doing this after a shim process change was driven into the airplane and it failed to be reproducable. Theres a long story behind how this program got as effed up as it is, and its a shame because when its assembled correctly, its a good bird. If I were still at BA, I still wouldnt get near this program with a 10 foot pole, tupperware shouldnt fly when the assemblers of the product dont care enough to do it right……. if you make the case that there is a reduction in fatigue values of the airplane because of bad assy, I wouldnt argue otherwise. We might have a discussion on the diferences between what it means with respect to limit load, but bad assy hurts the airplane.
Pedro, you are correct that there was a small number of aircraft (8, I believe) that had a combination of flaws. These were immediately grounded and fixed, years ago now.
But that is not representative of the existing fleet. The statements I gave for the aircraft in service, are correct.
Also the inspections you quoted, are a routine part of aircraft maintenance checks. There is no requirement for more frequent checks on the 787 than normal.
@ Rob
There was “a small number of aircraft” detected — SO FAR — .
Nobody knows what gremlins are hiding in the in-service fleet, because they haven’t been inspected yet, and because BA doesn’t have a sufficiently detailed manufacturing register to be able to pre-identify affected frames.
This really is a disaster waiting to happen.
Scott C:
Well after all these years and fatigue testing to (twice the lifetime) of the 787, its not a good argument that its flawed.
All aircraft are over-designed to a degree (the 787 wing never broke).
The A380 wing was interest as it did break but exactly where they predicted it would. I do not the A380 an issue to fly in based on how they handled it (some of the other issues were of concern but my take is they had good fixes and they worked)
Any aircraft is going to have issues if the shims are not right. That is not exclusive to CRRP.
Just the fact you use the term “Tupperware” (that is and was great stuff and in fact it lasted forever) trying to denigrate it speaks volumes.
I agree on not moving into a new area, I refused at the end of my career because it was all pain and no benefit.
Rob is correct, as long as it did not have combined shim and build specs off in the same spot, they are keeping an eye on it.
That is and has been true for Aircraft since time immemorial. Boeing in fact accurately assessed and built a program to deal with Aloha cycles and where the fuselage would fail (and it failed exactly where they said it would)
The prime failure was Aloha for faking the inspections (when they acualy did them on the rest of the fleet they were revealed in all their predictions as spot on).
The secondary failure was the FAA not keeping its eye on Aloha (the guy was responsible for all repair station in the Western Pacific).
It read very much like NASA and Boeing capsule, NASA said they assumed Boeing knew what it was doing and did not need the attention Space X did (ironic that)
So yea, its a shame that the 787 program got out of whack, its good it was caught and or reported and the FAA did something about it (the MAX victims paid a terrible price but others benefit, and that has been true for Aviation on other industries forever)
Read the Maconda report
https://permanent.fdlp.gov/gpo4390/C21462-407CCRforPrint0.pdf
The bottom line (pun intended) is that the 787 safety system worked vs the Maconda that was so corrupted it did not. Its why we installed layers of safety. You don’t want to have to use your safeties but this is all a human endeavor with all its flaws and if and when you need it, having layers of safety is the best system.
What about the 787 Section 41?
No way to re-use it, you just take all the parts out of it and those work on all models of 787
It sounds like AB would be much less affected by a strike at Spirit than Boing would. See also Pedro’s recent twitter link on build quality in the other thread..
Spirit, Wichita, supplies engine pylons for the A220. It supplies 8 of them per month.
That’s it.
Here are the Spirit programs.
https://www.spiritaero.com/company/programs/
Does this only effect Wichita?
Yes…only Wichita is affected.
Can A220 be produced without pylon?
They can be produced, but not delivered.
On the other hand, it’s possible AB has a stock of pylons (e.g. because they kept taking them during the recent downturn), in which case deliveries won’t be affected.
Either way: AB delivers about 4 A220s per month, so the potential revenue impact is very small.
This could well be troublesome: The offer was rejected even though it was recommended by the negotiating committee of the union. I have some personal leadership knowledge of these things and it suggests some serious internal issues – such as a massive disconnect between the upper and lower leaderships of the union. May be easy to solve but past practise in other ‘trade’ (meaning specific skill-sets in specific installations – as with this plant) has often seen sustained disengagements.
Perhaps the upper leadership of the union has been “incentivized” by other parties…who knows?
How an automaker kept its union officials “fat, dumb and happy”:
https://www.detroitnews.com/story/business/autos/chrysler/2018/08/16/sergio-marchionne-gave-expensive-watch-uaw-failed-tell-investigators-orruption/985477002/
That’s very common: union leadership often-to-always
gets coopted by management, leaving the rank and file out to dry. It’s not workin’..
Not sure how it works in Europe but that is not true in the US.
More or less unless a US Union offers constant increases, the management gets voted out. Having been in 3 unions, its a bit like a mob, small number intimidate the others.
I had one case where there was a vote on a proposal. I had heard that most of the people involved were not paying their dues and it was a Union Rule you had to be current to vote.
So I called it. The Union head (who had done a coup on the previous one) said, we don’t have to address that, we are all members here and just let it go.
Nope, I am paid up, you if anyone should maintain the rules, I call for a check of the books and determine who is and is not paid up.
Pretty funny how fast some people ran for their rigs to get checkbooks!
This also goes to show what outsourcing can do for and to you, Boeing no longer controls their own fate.
I would just buy out Spirit Wichita and give up on it as a failed experiment.
Having been on the end of an outsourced contract, you only do it because you chop benefits and its cheaper. The Union members have to ask themselves why should be not be paid full up? Spirit bids it lower than Boeing could do it. So it goes.
Boeing will have to do something quickly, boost Spirit compensation or buy it out. If the section 41 includes the 767 and it seems to, then no more KC-46A either soon.
Boeing’s stock Price has lost almost 10 points in 2 days…
My hypothesis is still fitting the facts, though one has to always be on guard against confimation bias.
#controlledDemolition?
From the link:
“Nearly Boeings entire commercial line-up is ridden with troubles. The company’s best-selling model, the 737 Max, has been suffering from various technical issues, the most severe of which led to its month long grounding. There are also new problems regarding the widebody 787’s horizontal stabilizer which potentially impacts delivery speed adversely. The777X, meanwhile, keeps delaying, with deliveries that were initially scheduled for late 2019 now expected for 2025. Some customers, including Emirates CEO Sir Tim Clark, have already threatened cancellations (although it should be noted that, so far, Emirates has not followed through). The fact that Boeing models disproportionately often suffer from engineering flaws (the likes of 787 battery issues, 737 Max MCAS failures, 787 water leaks) is probably not a coincidence. I find the narrative (as presented here and here) of a deterioration of Boeing’s engineering first approach following the 1997 merger with McDonnel-Douglas rather compelling. Notably, the original 777, the last model developed before the merger, has not shown the same level of design flaws. Deeply rooted cultural issues, will inevitably take time to address.”
“Arguably, Boeing’s biggest problem as a business is its massive indebtedness. The company reported more than $40 billion in net debt as of March 31st. While the overall debt load decreased by $1.6 billion to $55 billion YoY, cash and equivalents decreased by $2.4 billion during the same period. Notably, the company racked up around 85 percent of its net debt in less than five years. At year-end 2018, the net debt was only around $5 billion. There has, of course, been the impact of Covid. But that does not sufficiently excuse the massive increase. To put matters in perspective: Airbus today has a €8.4 billion (about $9.2 at current exchange rates) net cash position (compared with a net cash position of €13.3billion at the end of 2018) despite facing the same environment during the Covid years.
“Borrowing costs may be considerably higher going forward, given the relatively high and increasing interest rates. That could increase the interest and debt expenses, which have been consistently around $620 million to $690 million per quarter since Q1, 2021 if the debt burden is not reduced materially. As is, the company also has negative equity in excess of $15 billion. $4 billion worth of bonds with a weighted average coupon rate of 2.52 percent come due in 2024. Another $3 billion at a 4.5 percent coupon and $400 million at a 1.875 percent coupon matured in the present quarter. If the company were to refinance via new bond issues, it would likely have to pay considerably higher coupons.”
https://seekingalpha.com/article/4612661-the-boeing-company-held-down-by-its-debt-load
‘The commercial aircraft division continues to underperform. In the near term, Boeing’s defense division appears unable to compensate for the commercial segment’s losses. The defense division, too, has been unprofitable for the last few quarters and will likely continue to lose money due to cost overruns on fixed cost contracts, according to Boeing Defense Space and Security CEO Ted Colbert. Only the services business generates healthy margins at the moment.’
Guy knows what he’s talking about
———————————————————–
The critical crews favourite Wall St analysts, Seeking Alpha:
“Boeing: Time To Load Up
Boeing presents a compelling investment opportunity with a robust backlog of $411 billion and strategic partnerships, poised for outstanding recovery …”
ROTFL… not even I could be that bullish
@ Dukie
Did you see who wrote that particular “Time to Load Up” piece?
A commercial entity called “Que Capital”.
No conflict of interests, of course 😉
Dherin is also doing his best to pump it up:
Boeing Stock: Why I Am Buying More
https://seekingalpha.com/article/4611580-boeing-stock-why-i-am-buying-more
and the comments (SMH)
‘Looking forward to Paris Air Show. BA should shine. Beyond that getting planes out of the barn and improving FCF and paying down debt for 2023. Then BA can talk about stock buybacks and a dividend.’
Buybacks and dividends….
“Boeing’s biggest problem is it’s massive indebtedness….”
Worth repeating that before the Max disaster Boeing (with Calhoun on the Board) was spending more than 100% of Free cash flow on dividends and buybacks, and during the previous 8 or so years spent a total of $64 billion on this.
This management priority meant that the company had no savings to fall back on in the event of an unplanned disaster such as the Max.
Just saying that the financial hole was dug over the last 10 years by executive management, including Calhoun who was on the board.
And guess who has taken the hit from the bad management at Boeing in last decade ?
The shareholders !
Are you crying over the split milk of the share buybacks – a way of returning to shareholders THEIR money. They loved the buybacks as it also boosted the share price
What goes up can also come down , move on to other issues rather than worrying about Boeings shareholders
Duke.
Stock price and indebtedness are 2 different things. Debt is an obligation the company must repay. Its contractual. The stock price is independent of debt as there is no actual connection between the two. Case in point was the drop of the share price by 10 bucks in the last couple days because of linkage to the general market conditions and not one peep of a change in the debt being carried by the corporation…..
@duke
“And guess who has taken the hit from the bad management at Boeing in last decade ?”
The “hot potato”. That’s not long-term investment. Lol.
Scott C:
I don’t being to see how you separate Boeing debt and its stock price.
The reason they are in debt is the stock price (manipulation of it) so the heads of Boeing can make vast amounts of money off their shares (talk about an invitation to corruption)
Boeing stock has roughly tracked the Dow Jones index over the last 5 days, which lost 450 points, while Boeing lost 14 points over the same period.
The reasons for this quite obviously fall outside Boeing.
But, over the last 5 years, BA is still down 45%…whereas the DJ index is up…
We live in an upside down topsy turvy Newspeak world.
Yes, you can choose the time period to show a loss. As you can for any stock. Confirmation bias is nothing new here.
I answered the point raised by Checklist involving the last few days. My answer was correct.
And for the record, the 5 year decline is 33%, because it includes the pandemic downturn. If you choose the period of 1 month, 1 year, or YTD, all show net gains. But those again are an arbitrary choice. You can pick your answer via the period selected.
“My answer was correct.”
So was mine, Robbie.
Investors look at all sorts of periods when evaluating stock performance. They do that inter alia to evaluate any evolution in P/E value. It also allows “noise” to be removed from the larger picture, e.g. to reveal an underlying sideways trend.
On Mar 1, 2019 BA was at $440.
It closed at $205 on Friday.
I feel for those guys who were in at that rate and decided to hold onto BA because they thought it would rebound.
I don’t feel for anyone who bought into Boeing.
Much like the Titan, they knew what they were getting into even if they chose to ignore it.
I do have huge sympathy for Boeing employees as well as Spirit and those lost in the MAX crashes.
@Transworld
‘I don’t feel for anyone who bought into Boeing.’
How many employees had their retirements tied up in the company they worked for, trusting them to be good stewards of the corporation they were wholly invested in?
I know of one in here, who by a stroke of both good and bad fortune, sold out before the Max crashes and pandemic. How many employees were told to hold on, it’ll pass?
Over on the investing site, there were posts by employees (so they said) that word came down through the grapevine that, “It’ll be grounded for two weeks, then business as usual” and they believed?
How many older people, looking for a safe haven to park their retirements were told that Boeing was gold plated?
“Look at the backlog! Look at the dividends. Look what their doing with their free cash . Look at the profits. Over 800 aircraft and $12 billion in profits in 2018. Sales over $100 million.”
IIRC our friend in here got out around the $400 mark. Sold it all, kit and kaboodle – needed the proceeds for medical reasons.
SOMEONE bought those shares. Not all investors are day trading vultures; some buy long term and park their savings, trusting mgmt to run things properly.
Even today, with BA under a microscope and the financial facts presented in B&W, quotes from their own financial statements, you have people in here claiming that all is well.
“Cash flow! Backlog! Calhoun is the man!”
Not everyone has an accounting background. So who do you believe?
Thanks for the comprehensive link.
This provided one of our more colorful commenters made me smile:
Starts with this fluff: “Boeing is getting a head start on retrofitting the 737 MAX fleet with an additional angle-of-attack monitoring system by rolling out new aircraft with the needed wiring in place and preparing a service bulletin for operators to use on in-service airframes.”
but the piece finally ends with some substance:
“..Boeing has agreed to roll out the entire package of changes >>on the rest of the 737 MAX fleet within three years once it gets certified on the 737-10<< . Ideally, the work will be done during scheduled heavy maintenance visits.."
https://aviationweek.com/shownews/paris-air-show/boeing-jump-starts-737-max-angle-attack-system-retrofits
"jump start™" super-on-the-ball
“Boeing has completed the critical design review of an enhanced angle-of-attack (AOA) system..”
Its been signalled for almost 2 years this was going to happen such as a story in the highly reputable Aviation week in Nov 2021
“Fleming says the enhanced system will monitor five different parameters “that will help us determine whether we have an erroneous signal or not. And then if we determine that we have an erroneous signal, then we’ll suppress that and you won’t get the issue.”
It always makes me smile at how out of touch the critical crew always is.
I wonder if Dukie noticed that he missed the point that @Vincent was making…?
Upside is down, backward is forward.
Its incomprehensible , like his financial screeds.
most of it was just a rewrite of previous quotes , but no new quality information provided by actual experts.
In short his point ‘might be’ …meh
I struck me how proud, stars & stripes branded and nationalist Hall 4 looked. More than all the other national clusters.
By and for USA it seems. Look at us! Not cooperative..
Rethink what the goals are of participating, IMO.
Hall 4 had the best airco though 😉
Rumors that ended up not materializing at the show:
– Delta’s A330neo and A350 orders;
– orders from Japanese airlines JAL and All Nippon;
– widebody order from Indigo;
– orders from Viva Aerobus.
Some more?
– KLM widebodies.
– Qantas A330 replacement.
– Emirates follow-on.
Well remembered from KLM and Qantas. But I think any order from Emirates will be placed at the Dubai Air Show.
Yes, I think that the Dubai air show is a more likely forum for any Emirates order.
And there’d be a symbolic “goad” towards Emirates if Turkish / Riyadh were also to announce orders there.
I think airlines have become more careful ordering new aircraft, the future looked bright in 2019 too & everybody needed their governments to survive.
So a lot of energy, consideration an trade-offs go into fleet decisions and tradeshow timelines are low on the priority list.
I remember a few years ago big airlines were getting cold feet on becoming overly exposed to one OE, Airbus. That situation has not improved and the vulnerability of OE/supply chain problems hasn’t declined since. .
Will a long strike at Spirit Aero affect long term decisions by Boeing next new commercial aircraft and how its outsourced. The 737 had legacy production when it was Boeing That said, is Boeing too dependent on one 1st tier supplier for a new airplane launch?
Nothing beats a capital-light/asset-light financial model in WS.
David P:
Good questions and thank you for getting the tone onto something worthy.
The 777X wing being made in Everett is one example of the “rethink” of outsourcing but more from the 787 production mess than Spirit.
Spirit may in the future be a reason Bering buys back its production and goes back to more vertical integration.
Good question on can Boeing actually launch a new aircraft and while I think they can right now I suspect it would be painful.
But they have lots of people from the MAX, 787 and the 777X programs freed up so maybe……….
John Maynard Keynes: “I sympathize, therefore, with those who would minimize, rather than with those who would maximize, economic entanglement among nations. Ideas, knowledge, science, hospitality, travel—these are the things which should of their nature be international. But let goods be homespun whenever it is reasonably and conveniently possible, and, above all, let finance be primarily national.”
-> Prattandwhitney says ~10% of GTF fleet is AOG, awaiting an engine; admits that TOW “is not yet at the level we expect” and problem exacerbated by supply pressures affecting material availability. But TOW “compares favourably” V2500 at similar point #ParisAirShow
https://twitter.com/MaxK_J/status/1670780698104414210
Airdoc wrote
@Bryce
He won’t provide a link.
There’s no such thing as ‘deep storage’.
Check out the 2 citations in lease agreements where deep storage is defined along with the lessors obligations..
https://www.lawinsider.com/dictionary/deep-storage#:~:text=Deep%20Storage%20for%20any%20Aircraft,and%20components%20of%20such%20Aircraft
The request was for a link to prove Robbie’s assertion that the stored 787s / 737s were receiving maintenance while in storage…
Truly absurd and sadly what I have come to expect.
Yes Bryce, the Sun will rise in the East tomorrow and I don’t have to provide a link.
Poor @TW can’t follow the thread…🙈
Jump ship!
-> Boeing, UW and NASA deny design partnerships with OceanGate
WSU Everett and Everett Community College severed ties with company.
-> Boeing may have consulted with OceanGate, but it’s not clear what that involved, according to a 2013 UW news release.
“The Boeing Company worked with OceanGate and the UW on initial design analysis of the 7-inch-thick pressure vessel,” the release read.
Ocean Gate just overstated their claims
‘https://www.heraldnet.com/news/boeing-uw-and-nasa-deny-design-partnerships-with-oceangate/
‘“Boeing was not a partner *on the Titan* and did not design or build it,” the company said.”
There seems to have been work on a different design
‘ partnership was a steel-hulled submersible that can travel to 500 meters ( 0.3 miles) depth, named the Cyclops 1.”
Its clear what was involved, 10 years back
BA apparently doesn’t care what Ocean Gate said until it blew up in its face.
Ten years ago when BA was hair-on-fire working on re-engine the 737NG, 787 was briefly grounded (not really unless you look back a decade later) and the launch of 777x, BA was interested in a small project like this and reallocated its R&D staff?? Where’s priority?
I wonder when tbe first lawsuits will be filed?
BA knowingly supplied sub-standard material to another company (at a discount) — which is contributory to the accident that happened.
The passengers on board were very wealthy — plenty of money for litigation.
Bryce
…”Thanks!
Always amusing to see the desperate attempts at damage control by the BA Back Office…”
—
Where Bryce takes us on board is always a trick.
The stored 787s are among those that have been inoperable because of Rolls Royce.
This is an isolated case.
The market needs the 787 (Dreamliner and airlines trust in Boeing.
Far from what Bruce assumes, as a desperate attempt to troll Boeing
one more time …
We’re talking above about the airframe — not the engines. You do understand the difference don’t you? 🙈
***
“This is an isolated case”.
No, it’s not.
There are still hundreds of MAXs sitting out in the parking lot.
Lots of 787s, too.
For several years.
And it’s really hard to find customers for them 🙄
***
“The market needs the 787”
Making it all the more intriguing that 2 787s were scrapped because nobody wanted them 😏
The cabin of the C919 looks like a mock-up made out of wood. The seats, side wall, trunks give me an impression of poverty in the finish, but also a bad taste of the interior architecture. Doesn’t seem to have properly copied Boeing interiors. The other thing that shocked me is the shape of the engine mast with vents of the same shape and appearance as an old A320ceo…
It seems that the Chinese still need a lot of lessons. In the current state in my eyes, the C919 is nothing exceptional. Neither Comac nor China. Airbus and Boeing can still breathe for a very long time… This lack of taste and this blandness repels me. The Chinese will still have to learn a lot in all aspects of civil aeronautics. Watch Sam Chui’s video and judge for yourself… https://youtu.be/6g_Vk2A7AK0
Chceklist:
The C919 is merely a state of the Aluminum art and nothing to do with the future. IE, a copy of the A320. Shrug (no link)
That does not mean it won’t work, the ARJ works, how reliable? No link.
The C929 would have been the current state of the art with CRFP but that is a dead duck now.
Airbus got its start with a bold strategy, twin engine wide body. I even had to fly in one (I was impressed, nice solid aircraft though I was not keen on two engines over water).
Airbus had carte blanch as well as a lot of tech background to draw from as Europe had long been playing with various concepts and the Airbus entity let them execute.
Equally as flawed as Concorde was commercially,. it was an amazing and extremely well executed aircraft. Its one known flaw was known and should have been addressed.
It certainly aimed high and though commercially not viable, its clearly showed how capable European designers were.
China simply does not have that and a Chinese Communist endeavor is going to be saddled with mediocrity because it can’t do anything else. the system does not allow it.
While the C919 is FBW, its structure is no more advanced than the 737. Its not an advance of any kind and its filled with Western equipment.
Sure China keeps working on an engine for it and they will succeed, but it won’t be state of the art, its going to be pre CFM-56.
The Soviet Union had a jump on jet engine because they were given a design and even that was a dead end and the Axial Jummo was the way of the future.
But a post WWII draw down by war weary Europe and the US with other things on its plate and it caught the world by surprise in the MIG-15. Those are the kind of tech angles that can be played.
The Mig-15 was flawed in many ways but it was enough performance that is fought on equal terms with the best of the US (if we had put a bit more effort into higher output engines, that would have been a plus US advantage but that is also a history rewrite).
The MIG-15 did not have the movable elevator which was a key to high performance jets (but having seen it the Russian copied it and had a series of successfully fighters)
China is starting from way behind and did not even try a CRFP wing because that would have been well beyond the tech they had and decision was made for mediocrity.
Its one of those things most people do not grasp, but a system can’t generate something the system does not allow and the Chinese Communist run and controlled system simply could not conceive of or generate a more modem airliner.
I carefully separate out Chinese Communist from Chinese. Left free to do it independently, China is fully capable of innovation. Their system hobbles that in many areas and aviation is one.
China in its history has been far more advanced than the West in some areas and it certainly ramped up to match the West in others though its fragmentation hobbled it.
Good conservative rockets work and that is an area the system does work in. But you need a free nut job like Musk to try something brand new.
Yes. No coincidence the C919 was to be a modern carbon fibre wing single aisle plane but then wasnt. The difficult tech couldnt be mastered in time and then a ‘gift’ from Airbus came with A320 wing production contract to the same factory in Xi’an that now makes the C919 wing… in aluminium. Its like the Rolls Royce selling of the centrifugal nene jet engines to Russia, ( which in an improved version became Mig 15s Klimov VK-1) it changes everything.
Even MacArthur in the early 1950s knew from his life long experiences in Asia the Chinese alliance with Soviet Union was temporary only for as long as it suited their purposes and they could get the finance & technology they wanted , it only lasted till 1961 when a complete break happened .
The break point ( among others) from late 50s was over transfer of nuclear weapon & submarine technology which Khrushchev resisted.
@ TW said:
“Its one of those things most people do not grasp, but a system can’t generate something the system does not allow and the Chinese Communist run and controlled system simply could not conceive of or generate a more modem [sic] airliner.”
I wonder what his explanation is for the fact that the US “simply could not conceive of or generate a more modern passenger train”: the replacement for the current east coast Acela train was designed/built by French company Alstom…
On the subject of COMAC:
“And That Makes Two: COMAC Delivers Second ARJ21 To TransNusa”
“TransNusa Airlines, a subsidiary of China Aircraft Leasing Group (CALC), received the second ARJ21-700 aircraft early this month. The aircraft arrived in Indonesia on June 10th. This delivery signifies the second ARJ21 aircraft handed over by the Commercial Aircraft Corporation of China (COMAC) to an overseas airline.”
“According to recent reports, TransNusa is close to starting to utilize its ARJ21 for its international routes, with the potential destination for its first flight being Kuala Lumpur, Malaysia.”
https://simpleflying.com/and-that-makes-two-comac-delivers-second-arj21-to-transnusa/
@Bryce
‘Making it all the more intriguing that 2 787s were scrapped because nobody wanted them’
Turning to our trusty planespotters source
https://www.planespotters.net/aircraft/production/boeing-787?sort=status&p=22
Sort them by status and then check out the past two pages, 21 & 22
I make out about 45 Dreamliners parked. Among them British Airways, All Nippon, JAL, KA, Air China, Air India, et al.
After ‘Parked’, you have ‘Stored’ – a dozen or so jets, about half of which belong to lessors.
Then of course, you have the ‘on order’ planes, sitting in the employee car park in Seattle.
Pedro.
Your timeframe seems to mirror the Boeing Echo Voyager standup. Now I wasnt on that, But I knew we transferred MR&D guys to it. As far as the OceanGate peeps, today news is speculating up here that OG may have purchased a pile of expired prepreg from BA surplus….. I sure hope thats not the case
“OceanGate CEO Stockton Rush reportedly said that the carbon fibre used for the vessel’s hull came at a “big discount” from Boeing as it was past its aeroplane shelf life”
https://www.mirror.co.uk/news/us-news/oceangate-ceo-admitted-titan-subs-30313989
No problem with time, it was just a selling point. CFRP lasts a very long time and does not wear out. What do you have to prove.
This is based on an allegation “out of context” useless and insignificant for those who know
Checklist said…..
This is based on an allegation “out of context” useless and insignificant for those who know…..
I know. Yes, time matters on prepreg. Prepreg is carbon fabric impregnated with catylized resin. The process uses resins in the B Stage. B Stage materials are designed for short term freezer storage. In their frozen state they are still slowly hardening and have a freezer maximum viability dwell time before they have hardened enough to impair the normal curing process per the users process specifications.. Apparently you dont understand this process and the limitations on freezer out times and total freezer dwell times….. Its not a sales pitch as you assert but in fact a closely controlled method of getting product transported from the mill to the end user. Just abour anyone in the autoclave parts making portion of the industry haa this down cold. Sorry couldnt resist the pun……
Checklist said…..
This is based on an allegation “out of context” useless and insignificant for those who know…..
Checklist guess what, I know. Yes, time matters on prepreg. Prepreg is carbon fabric impregnated with catylized resin. The process uses resins in the B Stage. B Stage materials are designed for b short term freezer storage. In their frozen state they are still slowly hardening and have a freezer maximum viability dwell time before they have hardened enough to impair the normal curing process per the users process specifications.. Apparently you dont understand this process and the limitations on freezer out times and total freezer dwell times
Time matters on all chemicals, they each have their shelf life and you use a very conservative one in critial areas like aircraft (gulf clubs not so much)
Many hold longer when cold (some do not). We used to put our film in the Fridge to keep the longevity of it to when we used it (always nice in those days to order larger numbers and get a deal, stuff was seriously expensive and digital is wonderful)
Not sure what the argument is. Life safety should be conservative and well tested and Titan was a polar (pun intended) opposite and who knows if Rush was lying about the acquisition.
I do know Boeing used to surplus off stuff (the Surplus warehouse was a tech wonder to just walk through).
Over time we will know how the Titan came about and if Electro Impact really worked on it (I doubt it, they are far from stupid)
Bryce
…”Making it all the more intriguing that 2 787s were scrapped because nobody wanted them…”
—–
I feel spanking of Boeing hurts 👋👋.
-> 2 old 787s scrapped and another 600 new 787 Dreamliners to be delivered.
And you are desperately trying to convince us otherwise.
2 787 is catastrophic
Lol! What despair to affirm such an insignificant thing. Courage to you 👍
Very true.
They have scrapped 777 and A380s because the parts were worth more than they could sell the aircraft for (and in the case of the A380, no one wants to buy them, Emirates won’t buy used BA might but have not so ……………)
Does not mean there is anything wrong with the A380 that a GP engine would not fix right up, its just its not commercially viable so they scrap them to help Emerites keep their fleet going.
Looks like @TW missed the point — as usual 😉
Wow!!!
https://www.youtube.com/live/k-MQFvSMN7s?feature=share
Excellent commentary in French and English. Good shooting, and beautiful aircraft the MAX-10, and 777-X IS litle bit more a killer of elegance !….✈️
I’m not sure “killer” and Boeing is an association that “you” ought to be emphasizing these days. After all, the last
*three* commercial airline all-fatalities crashes have been Boeing 737s (two MAXs and one NG).
Hit the trifecta, they have.
Arrogance and cynicism make you forget the crashes of the A320s in 1988, 1990, 1992.
Sorry, it’s not up to me to assign the dunce cap of those who haven’t learned their lessons,
Otherwise I would have done it
Apparently checkbot is unfamiliar with the Streisand Effect.
But do go on..
Memory is maintained too. Do not forget it …
Don’t forgert next time and provide valid arguments.
Thks
Vincent, well said
Interesting article on the Wichita strike:
“One standard tactic to withstand potential labor turmoil is to stockpile inventory. But Arlington, Virginia-based Boeing likely has fewer 737 fuselages available as a result of the April vertical-fin defect that originated at Spirit, according to Kristine Liwag, an analyst with Morgan Stanley. She estimates that repairs will be needed for about 40 of the roughly 65 fuselages Boeing had stored as a buffer.”
“Boeing’s inventory of undelivered 737 jets stood at 225 at the end of the first quarter. It plans to work the figure down alongside shipments of newly built planes as Boeing targets 400 to 450 737 deliveries this year.”
“At best, a new offer could be approved and Spirit workers back on the job toward the end of next week, according to Ken Herbert, an analyst with RBC Capital Markets. However, the rejection of the package by a 79% margin with 85% of workers backing a strike suggests “a clear disconnect” between Machinist leadership and its members.
“We expect that pressure from Boeing will contribute to Spirit”s desire to put something in front of the union that will get accepted,” Herbert said in a research note. “But we can also appreciate that the union knows it has an opportunity now to be very aggressive with its demands, so there is an element of uncertainty on the timing of a resolution.”
** And of note **
“Airbus regularly evaluates suppliers and monitors their financial health, factoring these assessments into contingency planning, a spokesman said.”
Looks like BA doesn’t do such evaluation…
https://www.bloomberg.com/news/articles/2023-06-23/boeing-s-737-output-at-risk-with-key-supplier-in-labor-turmoil
Airbus doesnt have the type of multiple T1 suppliers like Spirit which provides major assemblies- they are all Airbus subsidiaries except Latecoere who seem to be downsizing
The components suppliers at the next level down and yes Boeing has staged interventions for the important ones.
Looks like Dukie has already forgotten that Spirit is a major external supplier for the A220 (wings, keel beams, fuselage sections, pylons), and that AB has a total of 12,000 external suppliers…even though we discussed this same subject just last week.
Thanks for all that info, especially the quotations. I support the unionized, striking
line workers in Wichita.
#solidarity
Bryce
“…Looks like BA doesn’t do such evaluation…”
—-
And what will this change for Airbus? They will also be subject to the Spirit strike, that’s all…
..it needs much better algorithms, methinks.
There’s no structure whatsoever to its thought processes.
It’s just a random syntax generator, using trigger words as prompts.
+1
“It’s just a random syntax generator, using trigger words as prompts.”
Hallucinating …
There is no ”AI” , there is only i-chaff; and there will be *lots more* of it from our rulers.
checkbot is a good early example. I notice that it and TW get along well.
Still since PAS’23, this improved standard from Boeing is stunning!
Can’t wait to see the second-generation “Boeing Sky Interior” on the 737MAX around 2028 before the launch of Boeing’s next aircraft that will replace the 737MAX around 2025-2026… 👍
https://twitter.com/BoeingAirplanes/status/1672500078433452032? t=RVR6uXjSxXGbd8Bo5NjkgA&s=19
And Spirit and the Union are in talks and the workers may well got back to work Sunday or Monday.
Boeing is not going to let this ramble on, probably enough nose and fuselages in the system to coast through.
A comment comes to mind from a guy I worked with, something to the affect that a fool if he keeps his mouth shut can create doubt but open his mouth and prove it is not a good strategy (assuming you don’t want to look foolish)
Sure I have been wrong (there was that one time I thought I was wrong but I was right) but that said, I don’t double down. A tech who does is an unsuccessful tech though I see it works for politicians.
If/when it gets resolved, it will cost Spirit a lot of money.
Spirit will then have to pass those costs onto BA.
Increased costs will push BA’s finances further into the ground…and it’s already making a loss every quarter.
“… may well got back to work Sunday or Monday”??
Lol. Which Sunday? Which Monday?? There are fifty-two a year, right?
Further signs of the anticipated cargo glut:
“Cargo Airline Western Global Weighs Bankruptcy as Cash Dwindles”
“- Creditors had begun confidential talks with company last month
– Truist seeks to sell loan, accepts bid of 40 cents on dollar”
“Western Global Airlines LLC is weighing options including filing for bankruptcy as it faces dwindling liquidity, according to people with knowledge of the matter.”
https://www.bloomberg.com/news/articles/2023-06-25/cargo-airline-western-global-weighs-bankruptcy-as-cash-dwindles?leadSource=uverify%20wall
Earlier this week, @Frank posted about the malaise at FedEx, which is laying off 23,000 employees.
Western Global has two 777F’s on order with BA, signed in 2022.
https://boeing.mediaroom.com/2022-02-16-Western-Global-Airlines-Purchases-Two-Boeing-777-Freighters
They have a fleet of 21 widebodies, including 17 MD11F’s and 4 747’s.
Seems to me that everyone over bought during the pandemic, thinking it was going to last forever.
IIRC Fedex is also parking aircraft.
Frank:
It was a rush that was not backed by reality. FedEx is an oddball as they go crazy in cycles and then drawback. I saw one office area get built, then stopped the finish out, then in spurts they built it out and in the end it cost them far more than just to have built it out and pickled it.
Their current aircraft buy was well before Covid.
I don’t know if you remember the day they announced, oh, by the way, the 727 is dated and old (3 person crew) and we are going to replace them all. Well the 757 was out of production so they bought around 100 pax versions and had them converted. The 757 is outdated as well so at some point they will have to jump to 737-800 or -8.
UPS ordered the 757F from Boeing.
MD-11F is not a very viable aircraft and is going the way the DC-10 did. FedEx spent tons of money upgrading the DC-10 to what is called MD-10, and then dumped them as they were not viable.
Others jumped into the game and the worst ones were the conversion operations who thought that was going to last.
I would separate FedEx out from the others due to FedEx oddity and erratic fleet building.
If they were going to buy 767s they should have bought used ones and converted them. The parked aircraft will be the MD-11 and A-300/310 if they have any left in operation.
The other aspect is that Widebody Pax aircraft are flying in numbers back to the pre Covid schedule. That puts a huge amount of freight capacity back in the air and cheaper than pure F carry.
In FedEx case they were overbuilding the fleet prior and Covid kept them out of the current situation.
So they will be getting out of MD-11, they even parked some 757PCF though those will come back on need.
The A300 fleet is getting old so those will start to go.
Fedex is closing the MD-11 base in Anchorage and likely the MD-11 simulator will go in the near future as well. They could put a 777F simulator in its place, the Sim Halls are agnostic.
So this is a video by Sam from Wendover (who loves talking planes) about Overnight Shipping. He talks quite a bit about Fedex – even talks a bit about Alaska.
The key part, to my point – starts at the 7:25 mark and runs for about a minute, or so. It’s on aircraft utilization.
https://www.youtube.com/watch?v=y3qfeoqErtY
@ Frank
Wow…that’s sobering data about plane utilization!
@Bryce
Yah – he does a nice job with his videos.
I guess it makes sense, if you’re going to have an asset sitting on the ground, doing nothing for 20 hours of the day, better that it costs you a couple million dollars as opposed to $40 or $50 million.
So they pay a little extra in fuel and maintenance.
Which gets me thinking.
https://en.wikipedia.org/wiki/FedEx_Express#Fleet
This is the Fedex fleet. They have 53 of the 777F’s in service, plus another 6 coming. They also have 128 of the 767-300F’s in service with 24 on the way.
Those 30 aircraft are new and they’ve got to get them in the air to make them profitable. If they’re sitting on the ground for most of the day, you might as well keep the old klunkers around.
Those 777’s are only 8 years old, according to Planespotters
https://www.planespotters.net/airline/Federal-Express
And the 767 fleet is just under 5 years old.
That’s ~180 new-ish aircraft they have heavily invested into, over the past decade.
Look at the age of everything else!
28 years. 32. 30.
I wonder if they’re getting the bang for the buck out of the new aircraft?
@Bryce
This is UPS
https://www.planespotters.net/airline/United-Parcel-Service-UPS
They have a smaller fleet, but they skew older. The young 747-8’s at 4 years old really brings down the average age. Take those away and you have:
20. 21. 17. 30. 29.
Panama Canal
https://twitter.com/SamChambers/status/1673271453364506625
Bryce
…”If/when it gets resolved, it will cost Spirit a lot of money.
Spirit will then have to pass those costs onto BA.
Increased costs will push BA’s finances further into the ground…and it’s already making a loss every quarter…”
—-
wishful thinking or established fact?…
He sells the skin of the bear, before having killed it
The guy continues in his hopes and his inobjectivity👍
Checklist:
Clearly someone went off the rails again, Spirit cannot just pass costs onto Boeing. They have a contract and it will be specific.
I suspect Boeing understands the cost jump and will negotiate it out with Spirit but that is negotiated, not passed on. Its not in Boeing interest to have Spirit disrupted (in fact it would be fatal).
What will be interesting is going forward and if Boeing buys back Wichita from Spirit or does a slow roll takeover or just does not outsource a future aircraft hull like they did.
It may have worked at one time when lots of unemployed aircraft workers but like all economic aspects, that changes and its a whole different world.
If all Spirit can do on the Boeing contracts is break even they will want to get out of Wichita as well. Its other work might make money (that is speculation, the only one that would for sure is the A220).
(1) Contracts don’t last for ever — they have a fixed term.
(2) Contracts can be re-opened and re-negotiated.
(3) There is such a thing as force majeure
(4) It’s in BA’s interest to do whatever Spirit asks in this matter — because BA will otherwise be assembling no aircraft.
***
“…if Boeing buys back Wichita from Spirit…”
Using what funds…?
Good question! 😂
The correct answer:
Let’s say with what fund Airbus paid the 20 billion euros of the A380 flop program?
Germany, France and Spain with the taxpayer’s pocket, ?…
(Of which I am a part)…
Roll eyes! How much debt BA is carrying? How much cash/debt AB has on hand??
Can you read a fin. statement? Do you know how??
BA is giving Spirit money to ease its financial burden, the last thing BA wants is a major contractor goes belly up. It’s not in the interest of Spirit to continue a losing business indefinitely, they own the tools and it would be very costly for BA to find another major contractor like Spirit.
Yes indeed roll your eyes when you see the same for the flop A340-200/-300, A340-500/-600 then came Power8 Airbus in agony. Fortunately, the taxpayer has the money in his pocket. Airbus has the right to make mistakes but not Boeing!…
Then the launch of the A350 was the last resort so that Airbus would not die in front of aggressive Boeing with the 777 and the freshly launched 787 (2004-2006)
Numbers for RLI ( as in “reimbursable launch investment” ) are freely available.
Overall it has been a rather profitable financial tool for the investors.
Compare to plain taxgifts from US government and states for Boeing.
an overall loss.
Thai Airways “aims” to buy 30 WB and an undisclosed number of NB.
Thai Airways is one of the least homogeneous airlines in the world.
It buys a multitude of mixed jets.
…”It comes after workers rejected a proposed four-year deal on Wednesday, with 79% voting no and 85% voting to strike.—
https://leehamnews.com/
6% of them said to themselves “I don’t want to go to work”…👍
-> DOT audit report details conflict within FAA over eVTOL certification
https://twitter.com/theaircurrent/status/1673373981280444423
Wow
-> “From my perspective, and Airbus’s perspective, we need a stretch, we’re not quite sure to what extent. That’s why we don’t call it a -500, call it A221,” said Airbus’s Chief Commercial Officer Christian Scherer.
https://twitter.com/jonostrower/status/1673472393107611649
From my point of view and that should be the same for everyone. Excellent excuse for Airbus not to launch a brand new program. The A350 is now 18 years old…👍
According to Forbes, if Boeing holds 68% of the widebody jet market in 2023 (60% in 2018), it’s up to Airbus to launch something new, isn’t it?
A320neo, A330neo, A221,
this one is pretty pale isn’t it?
Then ?
airbus may just have to sit pretty.
There is a good chnace that fullfilling those orders will kill Boeing.
Lol! That is the intention of some here.
You can always dream!🙏