Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Boeing AGM routine, action came an hour before April 20, 2021
- The conundrum of a new airplane design vs a derivative April 19, 2021
- Pontifications: End appears in sight for 16-year old US-EU trade dispute April 19, 2021
- Bjorn’s Corner: The challenges of hydrogen. Part 33. Wrap-up: The Eco-system April 16, 2021
- Aviation Writers Bloc: Calhoun’s Countdown April 15, 2021
Boeing should build 757 replacement in Washington
Commentary
Dec. 22, 2020, © Leeham News: If you get a chance over the next few weeks – in between binge-watching The Queen’s Gambit, putting up the 79 extra feet of Christmas lights you ordered this year and figuring out how to buy surprise Christmas gifts for your spouse when you have a joint Amazon account – you should take 90 minutes to watch this video from our friends at the International Association of Machinists District Lodge 751.
By Bryan Corliss
The Machinists on Dec. 8 hosted (on Zoom, of course) a high-level panel discussion about the state of the aerospace industry and Washington state’s role in it, featuring a whole bunch of Brand-Name People Who are Smarter Than Me(c).
They shared their insights for those of us coffee-drinkers who are trying to read the tea leaves to divine what Boeing’s next moves should be as it tries to get back on its feet – and what the implications are for its home state.
The takeaway:
The problems for Boeing are obvious, and the solutions are pretty clear – but doing the smart thing would require a major cultural shift from an executive team that’s locked into a 1990s vision of how business gets done.
- Boeing needs a 757 replacement this decade
- It should get built in Washington state
- There are concrete – and audacious – steps for the state to take
- Can GE alum Calhoun change Boeing’s GE culture?
Buzz about Boeing’s next new airplane returned this month to making a 757 replacement. Boeing photo.
Supply chain focus: Hexcel’s first 2020 quarter
By Bjorn Fehrm
April 22, 2020, ©. Leeham News: With the COVID-19 meltdown of airline traffic and aircraft deliveries, we place a special focus on the airliner industry supply chain in the next months.
Hexcel Corporation reported its 1Q2020 yesterday. In addition to the absence of MAX deliveries for a year, the mounting COVID crisis meant revenue was down with 11% year on year and profits 40%. The merger with Woodward Inc. is off. “This is the time for crisis management, not a merger,” said management.
Hexcel is a key supplier to Airbus A350.
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Aviation Forum Munich: Boeing moves away from Partnership for Success
By Bjorn Fehrm
November 6, 2019, ©. Leeham News at Aviation Forum Munich: The second day of Aviation Forum Munich had an interesting presentation from Boeing’s VP of Sourcing, Jody Franich.
He described the One Boeing approach for Manufacturing and Sourcing and how Boeing is moving away from its supply chain Partnership for Success program, with the supplier cost down focus replaced by a more long-term cooperation model with a mutual benefit focus.
Boeing’s VP Sourcing Office Jody Franich presents to Aviation Forum Munich.
Aviation Forum Munich: Vertical integration on the way back
By Bjorn Fehrm
November 5, 2019, ©. Leeham News at Aviation Forum Munich: The Aviation Forum kicked off in Munich today, a yearly production and supply chain event started by the Hannover based Institute for Production Management nine years ago.
Today’s conference themes were How the OEMs benefit from Supplier Innovation, Additive Manufacturing trends and discussions around Outsourcing and Insourcing.
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Mitsubishi sets stage for announcement at Paris
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Introduction
By Bryan Corliss
May 10, 2019, © Leeham News: Senior officials of Mitsubishi Aircraft Corp. said they’ll announce a new concept to replace their proposed MRJ70 at next month’s Paris Air Show. But they’re keeping details to themselves until then.
“We’ve got a couple rabbits in our hat,” said Alex Bellamy, the chief development officer for the MRJ program. “We’d like to keep them in our hat for now. But rabbits have a habit of bouncing.”
Bellamy spoke with a handful of industry reporters Friday at a roundtable following the formal grand opening of Mitsubishi Aircraft Corp America’s new office in Renton (WA). The event – which included the ceremonial opening of sake barrels with hammers–attracted senior executives from MITAC’s headquarters in Nagoya, Japan, and local business and government leaders.
Mitsubishi is flight-testing the 92-seat MRJ90 in the skies above Moses Lake (WA). But in Nagoya, engineers are working on a clean-sheet design for a 76-seat, three-class regional jet.
It’s what the market is calling for, Bellamy said, and right now, there’s a declining number of competitors willing to provide it.
Summary
- One competitor is going, the other doesn’t have a modern, Scope-compliant aircraft.
- 50-years opportunity.
- Combining comfort and new-technology economy
Cutting A220 costs is an ‘ongoing exercise’ for Airbus
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Introduction
March 14, 2019, © Leeham News: Airbus’ effort to slash supply costs for A220 production is “an ongoing exercise at this point,” Joe Marcheschi, Airbus’ head of procurement in North America, told LNA in an interview last month.
The A220-300 for JetBlue will be assembled at the Airbus plant in Mobile (AL). Airbus rendering.
“There are no specific, let’s say, achievements yet,” he said. “We are working closely with our supply chain.”
It takes time to squeeze cost out of the supply chain, he said. “We only took over July 1. That’s when we got full knowledge of the existing contracts.”
In January, Philippe Balducchi, head of the Airbus-led venture overseeing production, told journalists that the aerospace giant aims to realize “significant double-digit” percentage cost reduction. He indicated that most of the savings likely would come from the supply chain, according to news reports.
“Look, the airplane is absolutely fantastic—it just costs a lot of money,” Marcheschi said. “Now, we have to find a way to reduce the cost.”
Summary
- Airbus is working to slash supply chain costs on A220 program, but no announcements yet.
- The European plane maker wants to offer commercial MRO services in North America.
Boeing supplier reaches deal with Machinists Union
By Bryan Corliss
February 19, 2019, © Leeham News: Machinists Union members who work at Cadence Aerospace-Giddens in Everett, WA, voted overwhelmingly to approve a new three-year contract with the company.
Ninety percent of those who voted Monday were in favor of the deal, according to the IAM’s District 751. (IAM 751 typically does not release vote totals in its contract elections, only the percentage voting in favor or against.)
IAM 751 President Jon Holden called the contract a “positive agreement.” The union’s negotiating committee called the deal “one members can be proud of and can continue to build upon into the future.”
Boeing expected to lay out new contract terms for suppliers
Danieljcatchpole[at]gmail[dot]com
Oct. 16, 2018, © Leeham News: Puget Sound-area Boeing suppliers are anxiously awaiting an Oct. 30th meeting at 
the Lynnwood Convention Center. The aerospace giant has invited dozens of suppliers to the meeting.
Attendees have been required to sign non-disclosure forms in advance, though Boeing has been tight-lipped about what exactly it plans to discuss with them. Each company has been limited to sending only two representatives, according to several suppliers attending the meeting.
“It doesn’t matter if you’re a machine shop or a big (tier one supplier), you can only send two people,” said an executive at a Puget Sound-area supplier. The supplier spoke on condition of not being named for fear of losing business with Boeing.
Boeing has indicated that the conference is to discuss sweeping changes to how the terms and structure of its supply chain contracts. But it has revealed few details, according to executives at two suppliers.
“You know it’s bad if they won’t tell you what it’s about,” one of the executives said.
Suppliers are paying more, waiting longer for aluminum and other materials
danieljcatchpole(at)gmail(dot)com
An infographic highlights the role of aluminum in commercial aircraft production. (Image via Google Images)
Oct. 3, 2018, © Leeham News: United States-based aerospace suppliers say lead times and prices have significantly increased for aluminum, steel and other high-grade materials used to make commercial and military aircraft. But, they say, they have taken the increases in stride.
Aerospace suppliers based outside the U.S. generally have been less affected by the increases in lead times and prices for high-grade aluminum and steel, which President Donald Trump slapped tariffs on in March.
Suppliers chafe at Boeing’s demand for costly certifications
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Introduction
danieljcatchpole(at)gmail(dot)com
September 3, 2018, © Leeham News: Boeing’s insistence that more and more subcontractors meet stringent 
aerospace manufacturing standards risks adding cost and reducing flexibility to the supply chain, several direct and indirect Boeing suppliers tell LNC.
The aerospace giant is requiring more second and third tier suppliers have AS9100 certification. Until recent years, OEMs and their direct suppliers typically were the only companies that formally complied with AS9100.
Subcontractors were expected to conform to the standards, but did not have to formally comply with the requirements. Doing so is expensive and time consuming. Subcontractors’ work was covered by the Tier 1 suppliers’ or Boeing’s AS9100 certification.
The AS9100 standards were adopted in the late 1990s to improve and standardize quality management throughout the increasingly global aerospace industry.
Summary
- Boeing pushing more subcontractors to be AS9100 certified, according to suppliers.
- That risks adding cost and reducing flexibility in supply chain.
- Some suppliers worry it’s a prelude to more cost cutting.