Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Bjorn’s Corner: New engine development. Part 23. Development risks. September 6, 2024
- If a strike occurs, here’s what Boeing can do September 5, 2024
- China banks on C919, but numbers say it still needs Boeing September 2, 2024
- Bjorn’s Corner: New engine development. Part 22. High Turbine technologies. August 30, 2024
- The A330 for medium haul or twice the frequency with A321XLR? Part 1 August 29, 2024
Spirit Q2 / 2024 results are awful
By the Leeham News Team
Aug. 5, 2024, © Leeham News: Spirit AeroSystems released its second quarter financial results today and it wasn’t pretty.
Revenues were $1.492bn, up from $1.365bn last year – a 9% increase, year over year. However, the net loss was ($415m), vs ($206m) in 2023.
This brought earnings for the first six months of 2024 to a loss of ($1.032bn), compared with ($488m) for the same period last year.
Cash used in Operations burned through $566m vs ($183m) last year, while Free Cash Flow (FCF) was ($597m) against ($211m) in 2023.
Negative FCF for 6 months
For all of 2024, FCF was reported at ($1.041bn). Cash and cash equivalents total just $206m, while
Total Debt is at $4.061bn. Debt was reduced slightly, from $4.084bn at December 31, (a $23m reduction). However, Spirit started the year with $824m in cash and equivalents, down $618m.
Spirit reported that it had lower production volumes on the 737 Max program, delivering a less than anticipated 27 sets to Boeing (BA). Spirit detailed some issues in the release:
“Events in the first half of 2024 have resulted in significant reductions in projected revenue and cash flows this year. These recent events include the production and delivery process changes implemented by Boeing, lower than planned 737 production rates and the lack of price increases on Airbus programs. Management has developed plans to pursue various options to improve liquidity as needed and expects these plans to sufficiently improve the Company’s liquidity.”
The cash balance of $206m should be very concerning, not only to Spirit – but to Boeing, as well. BA has agreed in the acquisition of Spirit on June 30, 2024, to assume the net debt of Spirit Aerosystems, when the deal is consummated sometime in 2025.
As Spirit is forced to increase the amounts it borrows to cover FCF shortfalls and improve liquidity, Boeing will be forced to add more Spirit debt to its balance sheet, in the future.
27 Max deliveries. Wow
They can’t afford to sustain production. Spirit is borderline solvent. Boeing statement about continued cash burn coming into greater focus. Unless and until Boeing injects capital their goal of 38 deliveries per month went out the window
” The cash balance at the end of the second quarter of 2024 was $206 million.” says Spirit 1H2024
I think your claims arent connected to reality
They are still building *737 at 31 pm* , but deliveries are slowed while rework happens at Spirit -not at Boeing as before
Hence inventory has a big jump , which will become revenue when railed away
[cough]
What’s the sourcing for your claim they’re “still building 31” MAXes per month? As far as I know they are nowhere near that number.
Spirit says so its financials… further down I link to it
Building and delivery are different things- all plane makers FAL ( a’nd car makers factories) have large parking lots for ‘nearly completed work
As usual your clumsy smears are easily refuted… nor should the usual suspects and their smears allowed to get away with it
Spirit says so its financials… further down I link to it
Building and delivery are different things- all plane makers FAL ( a’nd car makers factories) have large parking lots for ‘nearly completed work
As usual your clumsy smears are easily refuted… nor should the usual suspects and their smears allowed to get away with it
What’s the point in building 93 MAX in a quarter when Boeing only accepts 27 of them? Boeing’s deliveries and revenues are going to take another dive in the next few months.
Do you mistook SPR’s word on purpose?
“Hence inventory has a big jump , which will become revenue when railed away”
Fuselage deliveries by rail should be public knowledge. correct?
Why should it ? They dont have to report each weekly train load , no, its in the quarterly numbers
Are you really going to stand by the tracks and count them- possible but only the more conspiracy minded would even consider it. Telling big porkies in the quarterly reports has lawyers for shareholders suing
spotters providing info?
Did you count how many shareholders lawsuits SPR has? 🤭
One should avoid the misconception that inventory is “money in the bank”.
22 fuselages per month entering inventory presents a major headache in terms of storage costs. Then you have to factor in insurance costs during storage. And, since the frames were manufactured with borrowed money, you also have extra loan servicing costs during storage.
But the big elephant in the room: all those sub-par fuselages have to be re-worked before delivery, and that also incurs (big) costs.
So, when one takes all these extra costs into account, it becomes clear that they significantly erode (already meager) margin. In other words: will that inventory generate a penny of earnings by the time it eventually gets delivered (if ever)?
No point in generating revenue if there are no associated earnings. BA learned that lesson with all the corroded frames that it still has out in the parking lot.
Cash or cash equivalents is the term. It is counted that way for all airline manufacturers or their suppliers.
Planes that have come out of the plant and are being readied for delivery, but transaction not completed by cutoff date is called cash equivalents
In Spirits product they are ‘stuffed fuselages’, when it gets to Boeing ( or on their train) its ‘sold’
I believe you are mistaken.
‘Stuffed Fuselages’ on the train would be classed as ‘Accounts receivable, net’ within the Balance Sheet.
‘Cash or Cash equivalents’ are purely financial instruments, such as Cash in Bank Accounts, Foreign Currencies, Treasury Bills and other short-term debit (less than 90 days maturity)
I understand your logic but stand by my statement. You are assuming that Boeing starts accepting fuselages in quantity and soon. It just pours more cold water on the notion that Boeing would hit rate 38 by the end of the year. Not sure what planet we are one when we assume that Spirit can make 9 of 31 fuselages within spec in Q2 to making 38 of 38 in the next 6 months. And that does not even address the burndown of production buffer that Boeing obviously went through to sustain the few deliveries they had.
For the last quarter, Spirit has been in the business of making very expensive paper weights.
@duke had similar prognostic for BA. It didn’t go well IIRC.
In May, Spirit began to layoff workers in Wichita. Why?? Production of the 737 *slowed* since a panel flew off one of those airplanes operated by Alaska Airlines in midair in January.
AP: Key Boeing Supplier Spirit AeroSystems Is Laying off 450 After Production of Troubled 737s Slows
https://www.usnews.com/news/best-states/kansas/articles/2024-05-16/key-boeing-supplier-spirit-aerosystems-is-laying-off-450-after-production-of-troubled-737s-slows
“Spirit reported that it had lower production volumes on the 737 Max program, delivering a less than anticipated 27 sets to Boeing”
That’s 9 per month.
Analysts estimate the current MAX line rate at BA to be about 15 p/m.
So, BA is using 40% previously-delivered shipsets from Spirit, and 60% new shipsets.
At this rate, Spirit will be bankrupt before the takeover deal can be comsummated.
Per Boeing’s Q2 report, they delivered 135 MAX through end June.
By my calculation looking at what was delivered, no less than 48 of those 135 were from stock remaining from the MAX grounding. So a somewhat more sobering 87 were delivered from “normal production” through to end of June.
With just 27 fuselages arriving at Seattle in Q2, Boeing’s deliveries and revenue are going to be down significantly in the next few months.
Assuming no more are shipped and none in a Q at Renton that would be true.
Spirit may ship some of the stashed ones if they can correct what ever sidelined them.
We know Boeing is having issues, that is not news. Its going to be a rough couple of years and hopefully recovery.
But this year is going to be bad and half of next year. Some of that can change to some degree if higher production is achieved for the MAX and 787.
That is the challenge going forward.
Are steps taken going to have an impact (hard to imagine anything under Calhoun would) and a longer time still to clean up the mess he was the last leaver of.
Spirit and Boeing need to come up with a plan to fix the issues and get these rates up, both are in precarious positions before combining, and until they solve that they’ll only get worse. What is keeping the rate at 27? Defects? Something else? The MAX10 also needs to get certified. They’re running out of runway on all fronts
There is only one thing that Boeing needs to focus on: fix the 737Max and 787 production. The 737-Max10, the 777x, even Boeing’s debt and cash flow and all other stuff is completely irrelevant until production is fixed.
If the production does not get fixed soon, it is not only Spirit which needs a bail-out, it is the whole supply chain. The whole supply chain is a house of cards now and if only 1 smaller supplier collapses due to Boeing production problems induced cash flow problems, then the problems go from very bad to completely catastrophic. I believe it is not Spirit who is at risk of collapsing, there are probably quite a few more.
Even when BCA’s production rates were higher, they still weren’t enough to cover costs and produce a meaningful profit in the past 5 years.
BCA’s biggest problem is a lack of margin on its sales…and that problem can’t be undone.
And another big problem is a lack of deposits inflow from new sales: with mounting cancellations, BCA effectively had net zero sales in H1. For years, deposits have been BCA’s main/only source of positive cashflow. — and that gravy train has now dried up.
Yes
Ndb has it spot on.
Of course Spirit is a mess. Previously Spirit mess was being corrected at Boeing end and at a cost to both.
You don’t wave a magic want and turn this kind of failure around in a quarter. CEO in a week, wow, click his heels and solve all the problems. Right Mel.
They will be lucky to stabilize by the end of the year and more like end of next year.
Getting the -10 certified does not solve all the issues either. Boeing needs clean build aircraft and in numbers.
Get that and you can begin to make progress.
Is that 27 737s delivered in Q2? Only 9 a month?
My question as well..
From the Spirit press release:
“During the second quarter of 2024, the Company delivered 27 Boeing 737 fuselages…”
https://www.prnewswire.com/news-releases/spirit-aerosystems-reports-second-quarter-2024-results-302214664.html
So that’s 27 for the entire quarter.
Still producing them just arent being shipped.
Quote Spirit report
” Spirit’s production facilities cycled at a rate of *31 aircraft per month* during the quarter, a rate faster than the units were accepted through the product verification process, which led to an increase of undelivered units in Wichita, Kansas.”
Boeing said they wont accept fuselages even with minor defects, so they are being held back for rework. Previously they were shipped to Boeing and Spirit staff were doing the fix on Boeings FAL.
” Once the completed units can be fully inspected and accepted by the customer, they will be considered delivered which will allow Spirit to collect on those units.”
Its simple people- even a non accountant could work it out- not looking at anyone whos always guessing
https://www.spiritaero.com/pages/release/spirit-aerosystems-reports-second-quarter-2024-results/
Which would suggest a startling statistic: namely, of every 31 fuselages Spirit produces, only 9 are on-spec…the remaining 22 being sub-par.
Thanks for that insight!
Where are they sticking these 66 fuselages? If my math is right.
Online, you can see a photo of rows of fuselages outside in a yard, each covered in white plastic sheeting…
Money in the bank 🙈
sub par or Boeing is overly picky to avoid having to pay up?
Overly picky maybe. But after the blowout Boeing doesn’t have much choice. That blowout is in large part rooted into poor quality work that travelled to the Boeing FAL.
Boeing is ultimately stopping its own production by holding work at Spirit. What’s left unanswered is how much rework those fuselage sections will require. Spirit will need its own ghost factories if there is meaningful rework.
Also unstated was whether the 27 fuselages that were delivered were done so with a first pass yield or whether those were reworked as well.
Casey:
What caused the blowout was a gap in the system that allowed an opening of the Exit Blank to not be properly handled.
The quality issue revealed that gap but it was there.
That gap is a core issue that should never have existed. Boeing managed to created that gap despite a process that should not allow it to happen.
The quality issues from Spirit (or Boeing) stand alone, so you have multiple problems.
Equally at issue is are there (or were) there other gaps. You can still have a cause to do an action that opens up an avenue of failure. It simply should not exist.
The quality issue should not either, but its two separate problems that one revealed the other.
Oddly the quality issues in of themselves would not cause a near crash. Its ugly, its got its own areas it might but a few rivets painted over are not going to be near fatal (or fatal).
Indeed!
“we’ll fix ’em later.” love it.
In newspeak, “cycle” means SPR is *not* producing consistently at a rate of 31 per month. Lol.
Boeing CFO West said in an investor conference in February 2024:
“And the FAA has increased oversight, and we welcome it. We believe the scrutiny from ourselves, from the regulator, from our customers, is only going to work to make us stronger. We also have to acknowledge that if we go slow and we stay at these capped rates for longer, we respect that. And right now, we have a 38-per-month cycle the supply chain is cycling to. First half output will be lower than that because we have to acknowledge that we have lots of things to focus on …”
Imagine actually getting paid — and handsomly paid, at that — to spout utterly meaningless waffle like that…🙈
Yes, that was quite the obfuscative word-salad from Mister West.
#shouldbefine
That’s what they’re reporting in their Q2 filings, so it had better be true.
Some benchmarking / for comparison:
“Airbus registered 59 orders and delivered 77 commercial aircraft in July 2024”
“Airbus’ commercial aircraft orders and deliveries for the month of July 2024 have been published as follows.
“July 2024 deliveries: 77 deliveries to 40 customers (1 A220-100, 6 A220-300, 2 A319neo, 24 A320neo, 32 A321neo, 5 A330-900, 6 A350-900, 1 A350-1000)
“July 2024 gross orders: 59 [6 A320neo for Berniq Airways, 26 A321neo (11 for Japan Airlines, 15 for an undisclosed customer), 7 A330-900 for Virgin Atlantic Airways, 20 A350-900 for Japan Airlines]
“2024 deliveries to date: 400 deliveries to 70 customers”
https://www.aviation24.be/manufacturers/airbus/airbus-registered-59-orders-and-delivered-commercial-aircraft-in-juy-2024/
—
That’s 58 A319/320/321-family deliveries p/m…versus about 18 MAX deliveries p/m (of which 3-5 old frames from the parking lot).
If we throw in the A220, then the AB narrowbody figure rises to 65 — more than 4 times the rate over at BA.
More benchmarking…this time regarding early slots:
“IndiGo to start wide body services on Airbus 350-900 by 2027”
https://www.aninews.in/news/business/indigo-to-start-wide-body-services-on-airbus-350-900-by-2027-pieter-elbers-ceo-indigo20240805144759/
So, despite being ordered just 3 months ago, they’ll be in service by 2027.
Weren’t “earlier slots” supposed to be a major sales pitch over at BA?
Then again, you can’t deliver early slots if you have an abysmally low line rate…
While not worth commenting on, when factual gets turned into Alt Facts, then it should be called out.
Slots for both A and B are oversold. More so for single aisle but they both know some airlines will have issues that mean no takers.
So when a slot opens up they sort out who they want that delivery to go to. Nothing more than that. Airbus is ramping up production and that is part of it. 10 A-350 a month is the goal.
We are also seeing the indicators for a down turn. Some Airlines may be pulling back, others no. It depends on their market, management etc etc.
United wanted more A321s sooner and can’t get them. That could change tomorrow.
Who wants to pay how much to get those slots?
More detail:
“Spirit delivered 27 737 fuselages in the quarter through June 27, lower than it anticipated and sharply down from the 74 it delivered in the year-ago period.”
“The U.S. supplier has also lost money on Airbus’ A220 program on higher costs. During the second quarter, Spirit recorded $25 million of forward losses on the program. Overall, it recorded net forward losses of $214 million in the period.”
“The company said it has developed plans to pursue various options to improve liquidity, as it burnt $597 million in cash. Analysts on average expected a cash burn of $169 million, according to LSEG data.”
“Spirit said it borrowed $200 million under a bridge term loan facility last month.
“Adjusted loss per share was $2.73, wider than expectations of 90 cents. Quarterly revenue of $1.49 billion missed analysts’ estimate of $1.59 billion. ”
https://www.livemint.com/news/spirit-aero-losses-more-than-double-as-737-output-drops-a220-woes-linger-11722896082958.html
—
So, the company has resorted to borrowing from a bridge credit facility; Boeing may not be far behind.
This is going rapidly south.
Seems like Boeing should have Spirit go Chapter 11 and put in a stalking horse bid rather than buying them. They’d just have to ensure that Spirit’s supply chain doesn’t go down with the filing.
no idea what the US laws look like, but in “normal” jurisdictions, insolvency administrators must immediately closed down all loss making operations, liquidate assets and try to rescue the profitable ones.
So, from that point of view, the Boeing offer is just a way to manage the collapse and being able to avoid a total chaos.
It is shocking to see, that not even the quasi-monopoly of Spirit in carbon components provides them with a sound business case as an aircraft ORM supplier. Now you can imagine, how bad live for other suppliers is. There is a lot of capital burning going on. IMO, the point of no return for Spirit’s demise has long been passed.
Chapter 7 vs Chapter 11 insolvency.
https://en.wikipedia.org/wiki/Chapter_11,_Title_11,_United_States_Code
IMU:
7: saveguards assets to satisfy creditors
11: saveguards the company against creditors.
Bankruptcy can destroy the supply chain of which BA cannot afford.
Indeed. Financial engineering is what got BA into this pickle.
Actually bankruptcy is quite nice (for a business, the laws are designed to make them happy).
You no longer are in debt, people will loan you money at great terms. Your shares become worthless and you can sell more. Its a wonderful system.
Reminder: Before closing of the merger with BA, SPR compensates AB $559 m for agreeing to take on the work performed by SPR, while it will pay a nominal sum of $1.
And, while it’s waiting for the merger to close — which is expected to take (at least) a year — BA is burning through $1B per month.
Moreover, BA has large-scale strike action to contend with soon, with associated costs.
And, while all that’s going on, Spirit is sinking deeper into debt…which will ultimately have to be added to BA’s balance sheet.
Lucrative deal! 🙈
Too big to Fail? If Spirit Aero is in that bad of shape, what about their second and third tier suppliers? Airbus should accelerate their purchase of Spirit assets to ensure the supply of Airbus aircraft. 737 production line and its supply chain could be going down!
Certainly a valid point, but neither Boeing nor Airbus can accelerate this deal: it’s now in the hands of anti-trust regulators, and they won’t lay an egg for many months.
The regulators in China, in particular, can be expected to take their time. Any change in corporate structure of a company doing business in China requires approval from Chinese regulators…and, when the company in question derives at least $55M of its turnover from China, the review process is particularly tedious.
Straight from the party in Zhongguo is that ?
When it started to become obvious that Boeing would step in to buy Spirit, why wouldn’t they have put the Belfast factory into Administration and leave Airbus with the headache rather than paying $559 million?
It’s not as if Spirit had to avoid pissing off a customer (and if that customer is costing you hundreds of millions a year, maybe it does make sense to “fire” them.)
Do you know details of the contract between SPR & AB? Is there any performance guarantee by SPR? Is it possible for AB to sue SPR? Last thing BA wants is egg on its face. 🙂
SPR supplies AB A320 & A350 program from Scotland & NC. I’ll leave that for professional to deal with.
-> ‘and if that customer is costing you hundreds of millions a year, maybe it does make sense to “fire” them’
If it’s that easy, SPR would have gotten rid of those $$$$$ losing contracts for BA years ago!
Bruce:
Shrug, its a complex multinational aspect and what applies where is ?????????
Why Airbus wants to leave itself exposed to a melt down is bizzare.
But Airbus said if they do a new aircraft they want the usual suspects to pay for it
So, Airbus is making billions and beating Boeing and they still need to have their hands out?
It defies all logic. A billion is nothing to Airbus but they risk programs to get it.
Boeing is not the only company that can be stupid management wise
Moribund BA buys moribund Spirit: why expect improvement from either outfit?
“The beatings will continue until morale improves.”
👇👇 FAA news:
“JenniferHomendy jumps in during the 737 MAX 9 hearing: “This isn’t a PR campaign for Boeing… What was going on then?”
https://x.com/davidshepardson/status/1820852024545550590
‘After Boeing’s Lund offers long explainer about changes to production, @JenniferHomendy says: “I just want a word of caution here, this is not a PR campaign for Boeing. What I want to know, what we want to know is what happened in March, April, May, June, July, August, September leading up to this.” ‘
https://x.com/jonostrower/status/1820852661769392502
👍
“One longstanding question just got an answer: Boeing’s fired 737 VP/GM Ed Clark has not been interviewed by the @NTSB as part of the investigation into Flight 1282.”
https://x.com/jonostrower/status/1820872032600326427
‘Boeing ‘s Elizabeth Lund reveals that the company did receive several “Speak Up” reports from employees about removal work (like that done on the door plug) prior to #AS1282. A review process was started, but “we did not get the elements and implemented prior to the accident.” ‘
https://x.com/willguisbond/status/1820862049779421444
‘In a back and forth between @JenniferHomendy & Boeing’s Elizabeth Lund, the NTSB chair asks on the new quality and production health KPIs: “How do we know these are the right numbers if they were available to you for years?”
https://x.com/jonostrower/status/1820887273963188738
“The NTSB board members are digging into the idea of Boeing’s durable level of change and historical back sliding on manufacturing quality, which it says has been a repeated theme through its AS1282 interviews.
“Spirit’s Michael Riney said Spirit contractors doing work inside Boeing’s Renton factory do not have access to the plane maker’s shipside action tracker (SAT), instead the contractors receive an excel spreadsheet that is checked for updates from prior versions.
https://x.com/jonostrower/status/1820913370679353659
“The SAT is a tool that tracks tasks that need additional manufacturing support. It’s been likened to Slack, but for building airplanes.
J Ostrower has compiled their updates:
https://theaircurrent.com/feed/dispatches/live-updates-ntsb-alaska-1282-investigative-hearing/
Great post. I forget JO does safety items that are open.
So many aspects to try to get sorted amidst a hugely complex undertaking.
👇 “Assumptions such as ‘we did it before so we can do it again’ are often wrong”
“Major demographic shift: Spirit’s Terry George says that 5 years ago 95% of Spirit assemblers had sheet metal experience. Today that number stands at 5%. Shifted from a 2 week training to a 6-8 week training.”
https://x.com/jonostrower/status/1820843024378663064
Ask TSMC about the availability/quality of skilled labor in the US…🙈
Continuing apparent disinterest in the “early slots” at BA:
(The graph at the top of the article speaks volumes)
“Cathay Pacific Nearing Deal to Buy Dozens of Widebody Aircraft”
“(Bloomberg) — Cathay Pacific Airways Ltd. is close to announcing a plan to buy dozens of twin-aisle aircraft and is favoring European planemaker Airbus SE in the decision, according to people familiar with the matter.
“The Hong Kong-based carrier is leaning toward Airbus to provide the long-range aircraft, though rival Boeing Co. could still seal a last-minute deal for its 787 Dreamliners, said the people, asking not to be identified because the discussions are confidential.”
“A split order between the two planemakers is unlikely, the people said. Cathay already has 48 A350s in its fleet and operates 43 older generation A330s. Boeing last won an order from Cathay in 2013.”
https://www.bloomberg.com/news/articles/2024-08-06/cathay-pacific-nearing-deal-to-buy-dozens-of-widebody-aircraft/
Order for 30 A330-900 + 30 more options.
“SCOOP: @CathayPacific is close to announcing a plan to buy dozens of twin-aisle aircraft and is favoring @Airbus in the decision.
https://t.co/2crKGPs9JX
https://x.com/AirEVthingTRNSP/status/1820842235820458154
Edit: sorry missed that @abalone has posted above
Interesting — though not surprising — that there’s no mention of more 777Xs…
In that regard:
“Spirit provides the forward fuselage, nacelles and struts for both the 777 and 777X.”
And regarding the 787:
“Spirit AeroSystems delivers a fully integrated fuselage structure for the Boeing 787 Dreamliner. The composite forward fuselage (Section 41) and engine pylons are built in Wichita, Kansas, and the wing fixed leading edge and wing movable leading edge are built in Tulsa, Oklahoma, and Subang, Malaysia. Spirit has been delivering these assemblies and components on the 787 since 2007. In 2016, the 500th unit was delivered to Boeing.:
https://www.spiritaero.com/company/programs/
” that there’s no mention of more 777Xs…”
cosmetic orders ( like the LH 777X “over”order )
are no longer achievable for B.
the pooch has a red and swollen rear.
https://www1.hkexnews.hk/listedco/listconews/sehk/2024/0807/2024080700175.pdf?fbclid=IwZXh0bgNhZW0CMTEAAR0u-RWFZIfCvwRoirea2nx64EBKmsHcDXhB2xl-TEt_aXx2bAVn1LgdnRU_aem_V4IlnxyM4-Kow-XM91WXKA
Looks like Cathay is buying 30 A330-900s.
Also reported by Reuters https://www.reuters.com/business/aerospace-defense/cathay-pacific-buy-30-airbus-a330-900-aircraft-11-bln-2024-08-07/
Wow.
And it’s a firm order — not an MOU, or a meaningless LOI.
Looks like Hong Kong was quite a bit more sure of itself than Seoul 🫣
Then again, Seoul had to make some kind of gesture so as to unstick the anti-trust blockade of the Korean/Asiana merger in the US…
‘Cockroaches of the factory’: Workers paint a picture of chaos and dysfunction at Boeing
https://www.cnn.com/2024/08/06/business/boeing-737-max-blowout-ntsb-hearings-day-one/index.html
Last 13 comments come from two posters.
Interesting
What is interesting is what is said – not who says it: As far as I am concerned both commentators are reporting facts, together with sources, not just opinion.
DH:
Fair enough though I question selective use of facts.
I was paid work wise to figure out what the facts meant.
An example was a Compressed Air Dryer that claim it used no compressed air for its function (one type we had used about 40 compressor HP to run its air purge dryer)
Well the Non Air Purge unit did use air for cooling off the desiccant towers, not nearly as much but it used air that had to be accounted for in the calcs for how big a compression plant you need for the mechanics ops and what it used.
Another one was Free Air Cooling air conditioning. Yea, but it had such a wide operating band that you had to set the computer room really cold then it rose to warmer that computers did not like.
So free cooling was worthless as the only way to manage a band tight enough was to disable it.
Anyone can find someone to support their opinion.
But what is the point without context and does it pass the smell test?
I mean we can put it down to, Boeing bad, end of the world, China good let the crowds cheer.
A/C for LNA? Wow.
BTW Are you questioning the objectivity of guys like J Ostrower, David Shepardson??
Oh the five stages of grieve!
some mornings i see a score or more of new posts.
and it is artless patter from just a single poster.
Bottom line is Boeing and Spirit are in for a hard time.
So, Team A scores 4 goals.
We know Team B has lost. Do we have to endlessly repeat that?
Yes the financial metric is important, not to kick Boeing but where they and Spirit stand. Without it you won’t know if they are doing better.
But say magic wand is waved and the next quarter they make 5 billion.
Is that reality? No, its just one data point, you need to see what the trends are.
So context and analysis is critical.
And anyone that has two brain cells knows Boeing is in for a slog to get back to normal (assuming they can). I think they can, I don’t think you see the turn around be level until next year. It may be 5 years.
And we are seeing an economic downturn. So BCA may have 5 years of pain. But its how much pain and they sure won’t be over producing (call it a silver lining)
In the meantime Boeing defense has some good very assets, some of which are doing well (P-8/E-7/AH-64/Chinook/ F-15EX, maybe F/A-18 (assumes navy needs to fill in missing F-35C)
KC-46A should reach stability or has. T-7A as well.
But note, Airbus talks about how they underbid defense programs, gasp!. Tell me it ain’t so.
Maybe Airbus should suck things up and buy out its part of Spirit before they loose production to Spirit meltdown!
Do I think its the end of the world for Airbus? Nope. Do I think some of those decisions like the A400 were stupid? Yep. Do I think overall Airbus management is better than Boeing (or its corporate approach) – Yep.
Airbus is more grounded in the political reality of Europe and that is not Jack Walch thinking.
But there is context and there is analysis and bottom line is Boeing has a rough road ahead of it.
It also finally has some hope with what looks like a good CEO choice.
The next part is seeing how he manages it. And the affects of good management are 2 years away to stability and 5 years + to full recovery if they can do it.
Flogging Boeing and Spirit while they are down is easy. What is disappointing is the lack of transparency. Boeing releases its quarterly earnings and cheerfully announces rate 38 by the end of the year and then Spirit comes out and announces production that is mind shatteringly bad. Did Boeing really think nobody would notice?
Six months after the blowout we should be past the discovery phase. Boeing and Spirit releasing guidance that is obviously inaccurate is a big reason why nobody believes a word they say.
Casey:
I think that is fair enough, but keep in mind Calhoun is not gone till Thursday.
Boeing and Spirit are in turmoil. Yes its managements fault but that management is going away. I won’t try to defend Spirit but they are linked to Boeing and what info they want to release to the public in regards to the new owner?
Boeing is not going to turn on a dime even with Ortberg in charge. He has a huge amount of work ahead of him. It took 30 years of bad management (more?) to get Boeing to this point.
Rather than short term indignation, I think long term assessment is in order.
Now if you are cheering the demise of Boeing (or your hope for that) then …………
I am not. I would like to see them recover. I am not going to be stupidly cheering but I am going to be watching to see where it goes.
I would not cheer Airbus going into a melt down either. I may not like how it was formed and funded but its a reality and a huge amount of jobs and industry are now dependent on them doing well.
I think its best for both Airbus and Boeing to have a good competitor. And no, China is not it. No issue with Candada, Brazil, Japan etc.
BBD made a heck of a good aircraft in the C series and Embraer has been amazing in carving out a segment and it would be grand to see a competitor from them for the single aisle market.
“announces *production* that is mind shatteringly bad.”
Production is 31 pm. Its the deliveries you have made a beginners mistake in calling it production
Check the facts
https://www.spiritaero.com/pages/release/spirit-aerosystems-reports-second-quarter-2024-results/
Oh yes, very Boeing-esque! Just ship it, who cares about quality?
So you think with FAA inspectors and the production down that has not had an affect?
We call that the Ostrich Affect, common meme before there were memes about putting your head in a hole in the sand and ignoring what is really going on.
Its a bad look when your post does not reflect the current aspects (and yes, I have made posts that were wrong/incorrect.
But it was not for a lack of trying to be informed in this complex area.
@Transworld
Just meaningless semantics.
Let’s say, your customer ordered ten chairs. Your made ten, but only three were accepted. The rest need re-works. Can we say you produced ten chairs? Yes, we can. But that’s meaningless, and not entire correct. Can you make an income estimation from those chair? No, there are a lot of missing data here.
Same with SPR here. They can say “produced 31” but that’s misleading, especially in financial context, which our discussion is in.
You keep trying to polish a turd. Less than 30% of Spirit’s production was accepted for delivery by Boeing.
That’s appalling by any metric regardless of how much spin you want to put on it.
Thank you for the crudeness.
No one is trying to polish anything.
Those who like to have simple response don’t recognize that its complex and a lot going on.
I would like to see you turn Spirit around on a dime let alone Boeing.
Yea, when you are on the pointy end of the problem its a lot tougher and for most of us impossible.
Duke and I disagree often, but I respect what he did in running a business. Something I never did.
You also like many ignore that this is going to take time to correct and its a huge amount of turmoil and in flux with not only the quality control issues but Boeing buying Spirit out as well as Spirit paying Airbus to take over their own stuff.
Something to think about if Airbus is all that smart to not grab their marbles while they aren’t completely broken yet. Frankly I think its a dumb move.
Boeing is going to do nothing resource wise towards those Airbus segments.
@Transworld
Please stop with the pearl-clutching. The comment wasn’t directed at you anyway.
Trumpeting a production rate of 31 is pointless when less than 30% are fit to be delivered to Boeing. But let’s get into the semantics of production vs delivery by way of distraction.
Crude is crude.
Yea it makes for a cool snippet but adds nothing to the discussion in my not so humble opinion.
You posted and I can comment on said post as long as I keep it inside the guidelines of which there is nothing that says it has to be directed at me or any other person such that if not so direct, you cannot respond to it.
To portend that is a cop out.
The underdelivered product obviously had enough flaws that Boeing would not accept them. I would argue that 30% acceptance is the best case scenario for Spirit. Those 27 delivered fuselages may not have been accepted at first pass. That detail is not revealed.
What is also not revealed is the rework required in order to deliver the ~66 fusealges sitting in undelivered WIP. Are we talking reworking a handful of rivets or replacing a seal OR did somebody screw up and drill a hole through a structural member. Whatever the damage was, it must have been significant enough to stack up that many undelivered units.
Casey:
Going back to the initial trigger for the door removal, as I understand it, bad Riveting was involved. That is pretty miner in the scheme of things.
Do not get me wrong. Its not acceptable, let alone the follow up of putty them and paint over as the first shot to get through.
The basic fact is that as near as humans can, they are obligated to a perfect fuselage delivered. A single bad Rivet has to be fixed. Its what they signed up for and no sympathy at all.
So Spirit is in disarray and they have to come up with a system to deal with that issue there not at Renton. So now your group that dealt with it has to be moved and still ensure any found issues are handled.
If things had been going well this would not have happened so a certainty you do not have the managers to pull it off.
Boeing managers are going to be out of the Condon to Calhoun people and clearly those are not the people you want in place.
Boeing new CEO is not even in position yet and when he is, there are 1000 fires to deal with. I am amazed he is willing to take that on (and a reason I think he is going to limit himself, huge stress dealing with a huge mess)
Spirit has to be tring to figure out do you focus on quality on the line and just shuck the bad fuselage aside or focus on the bad ones or try to do both? (which I think is what you have to do but a balance of skill is involved for where you get the most fuselages out in the time frame)
They may well have been better off shipping problem fuselages and fixing them on Boeing site like they have been (the build certificate probably does not allow that now they are being inspected correctly)
Who do the Spirit people listen to? Boeing mangers that will be gone, their own managers Boeing is beating on ?
Can you imagine the morale level ? Rumors running through the facilities like wild fire.
So one bad rivet can hold up a fuselage delivery.
I have said it before but I believe its relevant. You deliver a perfectly running aircraft with nothing wrong, and then a system fails and you are allowed to operate that aircraft under what they call minimum equipment list (MEL)
Its a misleading phrase, what it means is you count on backup systems to make up for the failed system. So its really an alternative equipment list.
So why delivery a shiny new aircraft in all its new glory and allow a degraded one to fly?
And yea, someplace in all the details will be how many bad rivets you can have developed and not have to fix them.
@TW
Not sure what you know or if you care:
BA knows for awhile SPR’s problems/issues, but did they force their contractors like SPR to raise production no matter what in order to meet their own (unrealistic) target of $10 billion FCF??
From J Ostrower’s compiled updates:
“10:02 am: On disagreement with Boeing on increasing 737 rate with Spirit, George says: “They have the authority, but obviously we’re going to fall in line on whatever the rate increase.” Notes strong discussions between the companies on rate increases, especially post-COVID. — JO
Five years of pain? They’re already in their sixth year of pain! So around eleven years of pain in total?
As I pointed out to Frank P, under Calhoun they were going to sink for sure.
They have a new CEO and he gets the latitude that its going to take years to fix what the Condon – Calhoun line have taken down.
Unless you believe in magic, it take hard work to fix the problem, but the hard work will start tomorrow and it ain’t going to be fixed tomorrow night.
Longer.
$3 billion in annual interest payments. $58 billion in consolidated debt. Cash burn off of $8 billion in 1H2024.
Getting to a break even position at BCA is going to be an accomplishment
‘Do we have to endlessly repeat that?’
It only seems like repetition because it is happening quarter after quarter, going on 6 years now. There is also this:
https://www.cnbc.com/quotes/BA
People use research to make financial decisions to invest in BA – just ask Jacobin who recently said he bought in at BA (around the $185 mark IIRC) and how he’s feeling about it being down at $165 today.
So, for 6 years now, same o same o.
I agree.
But Frank P, there is a new CEO. Everything I see says he is highly qualified even that engineer thing so many lust after.
You complain nothing is done and when something is done you keep beating the fuselage to death.
How about some analysis on what moves like write offs and sell off of segments would do?
Frankly (pun intended) I think Boeing has a lot to work with and if the CEO can get it working right, its got a lot of upside.
I don’t see them ever beating Airbus in the single aisle area, but if they can stabilize at 40% its still a good market.
A new aircraft in that area is not going to solve that, but it would give them a viable (hoping on that) product for the future to compete on equal or even better footing.
It took a lot of years to loose the SA market and I don’t see Airbus allowing it to be taken back. But if they can manage a product that is 5% better, while many Airbus customers won’t go there, current Boeing customers have that option and you might claw back one here and there.
Before Boeing stood no chance, now they have a decent CEO its not a given but its foolish to think he can turn it around in a quarter. There are many quarters of more pain.
“Boeing to make design changes to prevent future 737 MAX 9 door panel blowout
https://x.com/Jamie_Freed/status/1820929404798661068
Shrug. Nothing wrong with the system they have.
Putting lanyards on bolts is not a solution, its a knee jerk reaction to a failed process.
What about the engine sheer bolts. Landyard those too? The answer is having n your build work process complete. Do something, its in the system and red flags stay until its been complete and inspected.
The Cowl heat issue needs a fix, not the door blank bolts.
The whole avbiation system relies on that method.
‘Lund said Tuesday Boeing is still building “in the 20s” for monthly MAX production – far fewer MAXs than the 38 per month it is allowed to produce. “We are working our way back up. But at one point I think we were as low as eight,” Lund told the NTSB.’
‘Jonathan Arnold, Aviation Safety Inspector at the FAA, said a systemic issue he witnessed at Boeing’s factory was employees not following the instructions.’
She may be building “in the 20s”, but she’s only shipping about 15 of those p/m. One can only wonder why…
And she “thinks” production got as low as 8? Not very sure of the data at her own company, is she?
One wonders where BA finds these people: I’m guessing under rocks, or in hollow logs…
Where thoughts would be good is not just reporting the bad financial news, but what can Boeing do about it?
Write downs have been mentioned, but what I have not seen is anyone assess what kind of impact that would have.
Selling segment of Space and Defense off would have impacts that I would like to see assessed. Some are likely a wash, some like the defense munitions area would be eagerly sought out.
Satellites are another area that deserves assessment of what it would bring.
No one is buying out KC-46A and I don’t think even if someone wanted it that would be good for Boeing long term. Same with T-7 program.
Anyone can be negative. A test of worth is what can you do that is positive? If my folks had given up at the first obstacle they faced I would not be here (some would cheer that idea of course)
Do you cheer the sinking of a ship and crew and or passengers going down or do you support the crew that is trying to save it?
“Do you cheer the sinking of a ship and crew and or passengers going down or do you support the crew that is trying to save it?”
Well…considering that the crew of this particular ship (i.e., Boeing) has been on a years-long mission of killing people and stranding them in space (i.e., Starliner), I vote that we let the ship sink before the crew gets the opportunity to kill again.
As they say, “If it’s a Boeing…you’re not coming back”.
I am not for Boeing current management.
There are working people who are affected. Most of them are trying to do their jobs.
Equally there are innumerable suppliers to Boeing, and they are trying to do their jobs.
A complete Boeing failure could destroy a huge swatch of high tech US economy.
If that is what you are good with I pity you.
Canard management made a decision that speed was more important than running into ice bergs and the Titanic went down. 2400 passengers and crew as I recall. None of who had anything to do with Canard management decision.
If Calhoun had a heart attack and died I would have no sympathy. I certainly understand where the employees of Boeing are at as well as an industry dying and the affect that has.
2008 should have been enough for you. It took us 10 years to crawl out from that debacle.
Value for $$$?
More Than F-35: Why Does the F-15EX Cost $97,000,000 Per Fighter?
https://nationalinterest.org/blog/buzz/more-f-35-why-does-f-15ex-cost-97000000-fighter-211720
How come USAF can justify to pay more for a 4th gen fighter than an “expensive” 5th gen fighter like f-35?
“Boeing’s Defense, Space and Security unit, one of its three main businesses, has lost billions of dollars in 2023 and 2022.”
Would 2024 turns out to be different? 🤔
Update: “Boeing is more than $7 billion in the red on the KC-46… and is starting to incur significant losses on the fixed-price T-7, as well.”
“… they’ve gotten into some contracts in the past”—like the KC-46 taker and T-7 trainer—where “it’s apparent that as they were bidding those, there was key information they were lacking.”
That is so old it makes me look like a youngster again. sigh.
“How come USAF can justify to pay more for a 4th gen fighter than an “expensive” 5th gen fighter like f-35?”
Guess: Value for money.
F-35 is an unfinished committee product
while
the 15EX actually could do its job ?
Though this is generically a commercial site, the F15EX carries a substantially greater payload and overall has greater performance attributes. In the right environment, that is more helpful. We still fly B52s for that matter. There is a possibility Boeing will win an order for another tranche of B767 tankers too. The current order is already 2/3 delivered.
In reality, Boeing’s defense lineup is being relegated to selling old aircraft to countries that do not need the best aircraft available.
Finally, sometimes the government will throw a bone to keep airframers in business. It is not in the US government’s interest to see Boeing effectively leave the defense aircraft business.
None of this matters to commercial, but engineering resources are not unlimited…the next big contracts that Boeing will bid on are 6th gen Air Force F22 replacement and 6th gen F18 replacement…though both are delayed. That is probably a good thing for Boeing as they are not really in a position to launch a major new program until they get their commercial backlog over the finish line.
Casey:
Keeping this a bit on BCA frames. The sneaky tanker is also behind and the US still needs tankers. A KC-46A in the hand is worth 100 sneaky tankers that don’t exists. Not to mention the sneaky tankers will be a lot smaller than a KC-46A or an A330MRT. You are going to need to tank Mr. Sneaky so he can deliver valid fuel offloads.
I know the rest of this is going off track but you should be aware that the F-15EX has been taken up by the US govt and there are 100 on order. As you noted, it has a good use. Range, payload, FBW and ASEA Radar in a decent size.
We currently do not have enough aircraft for the various scenarios that are all to real now (Ukraine invasion).
The F-35 has problems and one of those little can be done about is range. To be stealthy is can’t carry drop tanks (even the brackets would reduce the stealth)
And the reality is F-35 costs a lot more to run, even with one engine (F-16 is still production and I suspect strongly the F/A-18 will be as well.
The US has developed a couple of new missiles, Aim-260 with extended range and the AIM-174B (SM-6). With those longer range missiles 4th gen air-frames are viable again.
No one has a true stealth aircraft, at best its a 4.5 with some RCS reduction and what makes them viable is longer range missiles.
Now they don’t have that range advantages. An AIM-174B is a 200+ kilometer missile. F/A-18 can carry 4.
In the meantime, an F-35 can probably get withing 20 miles of any fighter out there and not be seen by radar. If you can not see it, you cannot shoot it. You gotta have lock up (sans a shorter range Sidewinder type)
20 miles is about 60 miles or range even an AIM-120D can reach (ranges are tricky for missiles as a lot of factors go into an Engagement envelope.
Its worth noting that the F-35 was developed by the US, UK, Italy , Canada and despite its issues, sold a lot in Europe to allies because its perfect for that area.
I am fully aware of F-35 tech issues, but I am also aware of the huge value of if you can’t see it you can’t shoot it.
Upgrade US 4th Gen stuff is better than adversary 4.5 Gen stuff. So while its not a good strategy, Boeing is in a good position to supply needed numbers (not only is the F-35 way behind deliveries, older aircraft are worn out and being removed)
Number still count and missile trucks that can put out long range missiles that are spotted by an F-35 9or F-22 are beyond hugely valuable.
So yea, it puts Boeing in a good position.
Its worth a thought as well, LM has not delivered either. NG some and some but having issues with the new bomber.
But when you get a contract you get a big dump of money (1.5 Billion as I recall on the KC-X that Airbus got and did not have to give back)
Its what Boeing , LM or NG have in the research tank that counts and unless the contract is awarded now, we won’t know. USN is also having major issues on its new fighter.
I don’t see LM being any better than Boeing and maybe even worse, its just they got an exclusive.
Its part of the narrow anti Boeing chorus here that is out of context. No excuse for BCA, but its not easy and on the defense side, its really a tough slog for any mfg not just Boeing.
@Casey
Does it matter? The US can’t win a war against the Houthis who only possess the tech of Chinese ASBM from the 80s. Fast forward half a century later …
I acknowledge this is going off topic and will not begin to discus the issue, but lack of logic is hilarious for the lack of logic.
Yep, attack a desert. Good luck.
Egypt is the one truly without options, there goes the revenues from Suez Canal and I am pretty sure they are Arabic.
The ship traffic just goes around the Horn. Or we onshore production and both are happening. Prices go up a bit for Europe (US distance is less affected).
You are funny.
Deployment of the CVN-69 had been extended twice by the Pentagon. Both the carrier and its crew were exhausted. Can you explain why?
CVN-70 is on its way to the Middle East. There will be a window that not a single aircraft carrier is available for the West Pacific. (The nearest one that is available is like an ocean away.) Wink wink.
“Just around the horn”
OT but:
“The Israeli port of Eilat has officially declared bankruptcy”
ref: https://www.google.com/search?q=harbor+of+eilat+insolvent
So Dave “Cash Flow” Calhoun will be off the CEO throne on the 8th. Great, but he was just re-elected to the board in May, and the company just announced he will serve as an advisor to the board till next March. I find this confusing…..he is advising the board when he himself is a member of the board???
Has his role as director morphed into advisor, or is he simultaneously an advisor and a director, which would mean he is giving himself advice at board meetings, which sounds like some kind of Marx brothers bit. Maybe Calhoun wears two hats and has two seats on opposite sides of the board meeting room table. Calhoun the director poses a question to Calhoun the advisor, at which point he changes hats, vaults to the other side of the table, and responds, etc, etc, etc.
That is great.
I could not agree more and I love the post.
Who is on first?
I think you are going to see that cozy job for Calhoun removed in the next year or two.
Obviously there was a board split. Ok, you can have a good CEO if we can keep Calhoun.
The board members that want to see Boeing succeed should increase, people hate always being dumped on financial wise.
Its one reason I think there is going to be some major moves in write off as well as selling off segments.
Can you imagine the board meeting, the Chair says, Welcome to the meeting Mr. Calhoun, we have voted you an Award for getting us into this mess. A brass plated watch goes with that Award. Genuine guaranteed Brightling and not a fake! (yes the spelling is wrong like many fakes)
Yes, I think the biggest story the past couple of years has been the board, it’s actions, or lack thereof. This board supported and protected CEO Calhoun till the moment it became impossible, and now the question is, will the support and coddle director Calhoun to the bitter end as well? I hope not! It has shown the ability to replace other directors.
I really hope Calhoun will no longer serve as a director on the board. After all, if he remains as director long term it’s as though the board is saying, “ok, we know this guy was so spectacularly incompetent as CEO that our airline customers ousted him by staging an unprecedented populist corporate coup (aka, MBGA = Make Boeing Great Again).
So this guy proved himself totally incomplete as CEO, so naturally we want him to stay long-term to manage and direct the new CEO???
I am not carping about the short-term advisory role, just saying that if he retains his seat as director long-term, it is a slap in the face to every stakeholder and humanity at large.
Even in a short term role he clearly is useless, you are far kinder than he deserves
His choice for CEO was rejected obviously so the board is not fully on his side, he was recommended for removal and I think he will be soon.
The way the board has been sp supportive of Calhoun, even giving him that hefty raise, leads one to think that the Welchian beancounter block remains alive and kicking. This begs the question of whether or not it sees the necessity of transformative change in the culture. I an hopeful that Ortberg will try to “do the right thing”, but will this board support this if these changes come with a price tag? We all know that Calhoun wouldn’t spend a nickel on improving quality unless regulators or customers put a gun to his head.
Spirit seems to be managed quite badly looking at the recessions by employees in google maps for Spirit in Wichita. The workers complain since many years about the stress from being pushed to deliver the high volume at high speed. Quality does not seem to be a focus. The map (2024) nicely shows the many white 737 fuselages stored outside. This company needs a turnaround not only in financial matters.
Agreed, but what caused the meltdown is the low bids and then where do you cut?
When Covid hit, classic American, well lets clear out all them thar older workers that are costing us so much.
So yes, they need to fix the problems, that is also going to cost money so even fixing it is not going to stop the pain for some time. I am sorry for the employees that are trying to do their jobs.
Nah, this is on Boeing and their one-sided “Partnering for success”.
From Flight Global: “Boeing said its effort – called Partnering for Success, launched in 2012 – would improve quality and efficiency and “reduce the spiralling costs of product development”, according to its 2012 annual report. Boeing reportedly sought 15% price cuts from some suppliers and secured extended payment terms.”
No one is not saying its on Boeing . What happened to Spirit is part of that hack down of suppliers. But why did Spirit agree to that? No fuselages, no noses and you don’t have any aircraft.
We all know the history, changing it going forward is the goal. Never forget the history but it is well entrenched in everyone minds. Its why there is a new CEO.
Now you move forward and making sure it does not happen again under good management.
People keep bringing up Toyota quality and I believe they just recalled 500,000 engines that had crud in them. Complete replacement.
Toyota had a bust, any company is going to have those. Its what you do about them and in the case of Aviation, you want to catch problems before they get into the sky, not after.
In the case of Aviation unlike Toyota, its not dependent on one company.
That is the role the FAA should play, its the safety catch and they messed up big time. They did not want to do their job nor go to congress and say they could not.
“But why did Spirit agree to that?”
BA’s infamous ‘no “fly” list’.
Don’t you know why UTC merged with Rockwell Collins???
Lets see, if you make the widget and no one else does or can such that completing the entire aircraft build depends on, you do not have leverage?
Really? When you make whole fuselages and nose sections.
Anyone else out there that builds stuff like that, let alone all the noses for all the Boeing product. Tell me who is going to replace them?
That is too funny. Spirit held all the cards and Boeing could do nothing about it. Spirit had stupid management.
In addition to Boeing, Spirit Aero, Lockheed Martin and RTX, we can now add another entity to the list of clueless US aerospace players: NASA.
“NASA delays Crew-9 launch as it grapples with Starliner problems”
“LOGAN, Utah — NASA is postponing the launch of the next crew rotation mission to the International Space Station by a month as examines when, or if, Boeing’s CST-100 Starliner spacecraft can complete its test flight.”
“There has been reportedly a lack of consensus among NASA officials about whether Starliner is safe enough to return astronauts Butch Wilmore and Suni Williams to Earth, revolving around the performance of those thrusters.”
“At a July 25 briefing, NASA said it expected to hold an agency-level flight readiness review regarding Starliner’s return as soon as the end of the following week. But despite on-orbit tests of Starliner’s thrusters that went according to plan days later, that review has not taken place, and the latest agency statement did not mention a schedule for it.”
https://spacenews.com/nasa-delays-crew-9-launch-as-it-grapples-with-starliner-problems/
—
The blind leading the lame.
The Chinese must be — literally — rolling on the floor laughing when they behold this rampant and endemic dysfunction.
“According to Ars’ sources, Starliner’s current flight software isn’t able to autonomously undock from the space station and reenter through the Earth’s atmosphere — if confirmed, a confounding new ripple for what has already turned out to be a disastrous crewed flight test for Boeing and NASA.”
https://futurism.com/the-byte/boeing-starliner-unable-fly-without-crew
No surprises there: we know all about BA’s stellar reputation regarding software…🙈
Hard to believe that NASA allowed this piece of junk to fly…and brashly told us beforehand that the helium leaks were a non-issue.
Now NASA has major-league egg on its face, and has stranded 2 astronauts in space.
‘NASA associate administrator Ken Bowersox notes that the agency trying to “be data driven” about assessing the return of Boeing’s Starliner.
“When we started this mission, it was a test mission. We knew that it potentially had a higher risk.”
“We’re at the point now where we see additional risk that’s in a fairly broad uncertainty band.”
“We have to compare all those risks and we’ll weigh all that as we make our final decision.”
https://x.com/thesheetztweetz/status/1821231191594250449
“Bottom line: NASA’s hesitancy to return its astronauts on Starliner comes from Boeing not having a root cause identified for the RCS thruster failures and the possibility that additional thrusters fail after undocking.”
😂
“NASA’s Steve Stich says the agency has a plan in place to launch two astronauts on Crew-9, and bring back Butch and Suni in February 2025 on that vehicle. NASA has not decided to activate this option yet.
https://x.com/SciGuySpace/status/1821226399945912804
That gives a literary ring in my ear:
https://en.wikipedia.org/wiki/Two_Years%27_Vacation
Ortberg’s first headache:
(I doubt Ortberg believed this would be one of the first things he has to tackle when he accepted the job offer.)
WaPo: “This has become an extraordinary story. Strong disagreement between Boeing and NASA, an 8-day mission extended to 8 months, and more doubts about Starliner as NASA weighs SpaceX option for the return.”
https://t.co/mot9u9mTNU
https://x.com/wapodavenport/status/1821299713389556208
@Pedro
“Just launch it”
🙈
Interesting
AW: Boeing Questions CFM RISE Open Fan Viability For 737 Successor
https://t.co/XAVmOuTsbH
https://x.com/R_Wall/status/1821178866511106289
Very good AvWeek article; thanks for the link.
I enjoyed the neo-neologism “ducted propulsor”.
Gotta make the same old stuff sound brand new..
Looking forward to the updated article.
I guess that would be behind paywall.
AW: Airbus CEO Puts Pressure On CFM For On-Time Deliveries
“NTSB examines the roots of the Alaska Airlines incident in January that tipped Boeing into crisis: rushed assembly lines staffed by untrained workers”
https://t.co/XULGdk4i2v
https://x.com/dominicgates/status/1821000218374238719
“Flaws, fighting and a mystery ‘move crew’ set stage for Boeing blowout An excellent account by @LRosenblatt_ from Tuesday’s NTSB hearing on the still unanswered questions over how four bolts on the door plug were taken out and never reinstalled.
https://t.co/mu90juOdBG
https://x.com/dominicgates/status/1821192818792264159
I believe they said there are 62 other actions and those all had the same paperwork gap.
It should be noted the FAA is complicit in all of it as their auditing was all paperwork and anyone who has done that kind of floor level work knows, paperwork can be pencil whipped.
You need both the system and the workers who know the I has to be dotted and the T crossed for a reason and do it consistently.
It is still stunning to not know who was involved in that work. I am sure they have a good idea but no info from Boeing nor workers speaking up. The have to be in huge fear if they do.
Somehow the other incident were caught, so its almost a certainty that someone noted it or followed up on their own.
As has been stated, its not that it happened, its why it happened.
Reality is if its corrected it is not relevant now, but you also do not get the track of how it got to be that way and if there are holes in the system needing to be plugged (sadly no pun intended)
How the manual trim control on the 737 got to its failure in Sim programing and not true to actual ops is another one. How can you have a major change like that and no one noticed it, let alone it was changed and why?
That went back to the NG at least, Manual Trim was easy regardless of speed in the Sim and its absolutely not true in real world ops where it gets so hard as to be impossible without unloading the stabilizer.
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Change is in the air!
“Confirming @PRWeekUS — @boeing head of comms Brian Besanceney says he is stepping down as new CEO arrives tomorrow
https://x.com/davidshepardson/status/1821296806925627804
One wonders if the ultra-low-profile Ms. Pope will be continuing on as BCA CEO. What an odd fit for the position she appears to be.
@Vincent
If I had to hazard a guess I would say she will be gone too. I am not aware of anything obviously wrong she has done, but I see nothing in her background that qualifies her for her current role.
And going back to her old role is probably not something Pope would entertain either.
If the Board wanted to change the culture, then this has the feel of a housecleaning. The same hatchet will fly at Spirit as well
Shanahan maybe?
WS has little patience.
Fortune: Boeing’s new CEO, Kelly Ortberg, sparks hope of a culture shift—but first he must address its awful finances
‘Incoming Boeing CEO Kelly Ortberg probably didn’t need a reminder of what he’s walking into. Nonetheless, the troubled airplane manufacturer’s Q2 earnings, posted just before his hire was announced last Wednesday, underlined the mess he’s inherited. The company reported a loss per share of $2.90, missing analyst expectations by almost a dollar. Its core operating loss more than tripled from last year to $1.4 billion.
Even with a respected industry veteran assuming the helm Thursday, the numbers could get worse. Two decades of leadership missteps at the company have been well documented, but Bank of America senior analyst Ronald Epstein said Boeing’s credibility issues also taint how investors view its financials.
“They’ve been saying—quarter after quarter after quarter—a certain narrative, and it just hasn’t played out,” Epstein told Fortune, expanding upon his note on Boeing titled, “A bad quarter, and by no means was this the kitchen sink.”
https://fortune.com/2024/08/07/boeing-kelly-ortberg-awful-finances/
Reminder: BA took a charge close to $400 m for its KC-46A contract in Q2.
https://www.nbcnews.com/business/travel/ntsb-grills-boeing-execs-safety-culture-retaliation-allegations-rcna165653
Boeing execs testified before the NTSB.
So after all the shop mechanics described the chaos of the factory floor, did they trot out Calhoun to say everything is just fine and dandy and he is proud of Boeing ‘s safety record? Jacka$$!
Sounds way worse, but nobody can really figure out were they are at, unless you know how the process looks and how many fuselages are in rework and where.
Boeing still has plenty of Max standing around, so deliverys do not mean production.
And if the supply chain has issues, it`s a long way to fix that.
If Spirit builds up inventory, that`s not that much of a drama, as long as it doesn`t eat up their liquidity.
So it sounds like they have lost 600m.$ in cash, but in fact a large part of it is stocked up inventory after FAA had caused a reduction in production.
They will fix it, sooner or later, the question is rather how much will it cost Boeing to fix it and how long will it take.
Boeings big argument in selling the Max is the availability. Thus even having constant or falling deliveries is a huge blow to their market position.
They should have been able to rise the production numbers, not reducing them.
Main Max customers are already pissed by delays and those things can cascade down.
To get the quality, supply and production chain back inline might take them rather years than months, there`s a lot of planing, training, time, etc. involved.
Might be rather 1,5 years than 6 months needed to get this under control and back on a growth path.
That will make A220 and Neo viable options to buy if Boeing can`t deliver faster.
It might also take resources away needed to get the Max 10 certified.
Not to forget quality and production issues with the B787.
It might be harsh times ahead again – or they never ended.