The Airliner Production Problem, Part 2

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By Bjorn Fehrm

September 19, 2023, © Leeham News: The Airliner OEMs can’t increase their production rates as planned after the pandemic, and it’s become clear it’s not a short-term problem. We started looking at the root causes of the difficulties last week.

We looked at the complex puzzle the production of a modern airliner is and the importance of the learning curve for the result. Now, we analyze the effects that the pandemic had on airliner production and why things are not the same as before the pandemic.

Figure 1. The Boeing 737-8 is sold out for years. Source: Boeing.

  • Last week, we looked at the importance of skills in the supply chain and their influence on production rates.
  • Now, we analyze what happened with skill levels in the industry before, during, and after the pandemic.

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The Airliner Production Problem

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By Bjorn Fehrm

September 14, 2023, © Leeham News: For more than a year, we have heard all the Airliner OEMs complain that they can’t increase production rates because of delivery problems in their supply chain. It’s a problem that is not easy to fix; it just goes on and on.

What is the root problem behind the persistent problem of increasing production of our airliners? There are specific problems for each aircraft type and time, but some fundamental problems are behind the overall problem of increasing the production numbers.

We analyze these fundamental problems in a series of articles.

Figure 1. The Airbus A321, a model which a new customer gets delivered six years from now if the production increases to plan. Source: Airbus.

  • We start describing the realities of airliner production, and what a gigantic puzzle it is.
  • We also delve into the learning curve, and why it has such importance for production rates.

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Bjorn’s Corner: New aircraft technologies. Part 29. Detailed design

By Bjorn Fehrm

September 8, 2023, ©. Leeham News: We described the Preliminary design phase of an airliner development program over the last weeks. Now our project is transitioning into Detailed design.

It’s the most challenging part of the project as we now go from perhaps a thousand people involved at the OEM into tens of thousands and even more people at consultancies and suppliers.


Figure 1. A new airliner family development plan. Source: Leeham Co.

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Bjorn’s Corner: New aircraft technologies. Part 28. Alternative Preliminary design

By Bjorn Fehrm

September 1, 2023, ©. Leeham News: We described the Preliminary design phase of an airliner development program last week. One could say this was the classical way that aircraft projects conduct Preliminary design.

There is a different way that Conceptual and Preliminary design can be run. It’s more along the lines of pre-development of functions, as a reader commented on two articles back.

Figure 1. An alternative new airliner family development plan. Source: Leeham Co.

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Bjorn’s Corner: New aircraft technologies. Part 26. Airliner development program

By Bjorn Fehrm

August 18, 2023, ©. Leeham News: We started last week to look at how to make the development of a new airliner family more efficient.

First, we describe how development projects are phased and how many people with what competencies are engaged in each phase. Then we can start the discussion of what changes can be made and what would be the consequences.

Figure 1. The JetZero Blended Wing Body that USAF partially funds to prototype. Source: USAF and JetZero.

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The reality behind the eVTOL industry’s hyperbole, Part 4.

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By Bjorn Fehrm

August 3, 2023, © Leeham News: We look at the promises that the VTOL industry has made in their Investor prospects and the reality as they come closer to Certification and Production.

After looking at claims of range and utility, we now look at the operating economics. To do that, we need to predict the net sales price of these machines. We use our Aircraft Performance and Cost Model (APCM) to predict the production cost over time and, thus, the needed net sale price of the VTOLs.

Figure 1. The Archer Aviation Midnight VTOL mockup at the Paris Air show. Source: Leeham Co.

  • The VTOLs are big; the Archer Midnight is the size of a nine-seater commuter aircraft (Figure 1). Aircraft costs are related to size and weight.
  • VTOLs use aeronautical production methods and supply chains for parts and systems. The production costs are, therefore, predictable.

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UPDATE: Spirit says 737 manufacturing errors will disrupt deliveries through July

By Bryan Corliss 

March 3, 2023 © Leeham News – The manufacturing errors its team made on Boeing 737 MAX fuselages will cost Spirit AeroSystems at least $31 million to fix, with work on the units still at the Wichita factory going on until the end of July, the company reported this morning.

But that’s just the start, Spirit executives warned.

“Additional costs are expected, including costs Boeing may assert to repair certain models of previously delivered units in their factory and warranty costs related to affected 737 units in service,” the company said in its quarterly earnings release.  

The time and cost to make those repairs will have to be determined on “a unit-by-unit analysis,” Spirit said, adding that it “cannot reasonably estimate the remaining potential costs at this time.”   

Repairs to the fuselages on hand in Wichita will cost $100,000 to $150,000 each, the company estimates. Spirit has revised its manufacturing process and implemented new quality controls, the company said.

Overall, Spirit reported an operating loss of $95 million for the quarter, which more than doubled its losses in the first quarter of 2022. The growing losses came even though Spirit increased revenues by 22% year-over-year, to $1.4 billion. 

Spirit said that since the close of the quarter on March 30, it has received $230 million in cash advances from customers, of which $180 million has come from Boeing. It will receive another $50 million in advances later this year. Spirit is to repay those advances in 2024 and 2025.

  • Some 750 737s to be inspected, may need rework
  • Spirit to increase 737 rates in August, October
  • Deliveries to Airbus to be down this year
  • ‘Fragile’ supply chain remains an issue  
  • ‘Primary object is to reward our IAM colleagues’

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Howmet: Supplier still cautious about rate increases at Airbus, Boeing

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By Bryan Corliss

March 3, 2023 © Leeham News – Executives at Howmet Aerospace – who got burned in 2022 when expected production rate increases at aircraft OEMs didn’t materialize – said Tuesday they’re still taking a cautious approach to ramping up their operations 

However, the company – which casts fasteners and engine components for aerospace and other industries – does see signs of growth ahead. 

“We remain cautious about commercial aircraft build in the second half (of this year), until we see clear evidence of consistent production rate increases,” Howmet CEO and Executive Chairman John Plant said. 

Production rates at Airbus and Boeing “will be controlled by the efficiency of both the aircraft assembly lines and the supplier parts, which leads to the final production being set by the weakest link in all of the supply chain,” he added.

Howmet reported strong growth for the quarter, with revenue up 29% year-over-year, driven by sales of engine components, aerostructures and fasteners. 

The company reported profits of $148 million for the quarter, which was up 13% from the same quarter last year. 

  • Howmet laid off workers at end of 2022
  • Company hiring to support rate increases
  • Howmet projects growth this year

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UPDATED: Boeing says it still will deliver up to 450 737s this year

Boeing Co. photo

By Bryan Corliss

April 26, 2023, © Leeham News — Boeing says it will increase rates on the 737 line in Renton to 38 a month to maintain its plan to deliver between 400 and 450 737 MAX jets to airlines this year.

That was the first line of the company’s first-quarter earnings release, which showed Boeing lost $149 million on the quarter, on revenues of $17.9 billion.

Boeing had optimistically aimed for jumping MAX rates from the current 31 a month, as soon as June. However plans for the 737 line had been in question, after recent revelations that manufacturing problems and a software issue would cause delays in deliveries.

  • ‘Gnarly’ 737 defect to take weeks to fix
  • Boeing commits to MAX increases
  • Improving numbers at BCA
  • Supply chain issues continue, Boeing says

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Howmet taking cautious approach projecting OEM deliveries for 2023

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By Bryan Corliss

Feb. 15, 2023, © Leeham News – Howmet Aerospace is taking a “cautious and conservative view” that Boeing will build 30 737s a month this year and Airbus will build 53 or 54 A320s and A321s.

That’s what CEO John Plant told investors Tuesday, as Howmet reported its year-end and fourth-quarter earnings. 

That’s far more conservative than the 737 build rate that Spirit AeroSystems had projected the week prior, Plant acknowledged. Executives with the Wichita airframer project sending 42 737 fuselages a month to Boeing by the end of this year.

Howmet, which fabricates fasteners and casts pieces for aerostructures and jet engines, reported annual profit of $1.3 billion for last year, up 12% when adjusted for one-time items. For the fourth quarter, its adjusted profit was $336 million, up 13%.

  • Howmet ended last year with excess inventory
  • Company still projects 17% growth in Commercial 
  • Howmet hiring, but not everyone is sticking around
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