Friday, October 31, 2008

787 brake issue resolved

UPDATE : Matt Cawby posted a couple of pics showing trucks delivering 787 parts outside building 40-26. He also stated that the inboard wing flaps should be installed very soon and that the thrust reversers are on. See his post here. Also I talked to a 787 machinist and he's and some others he knows plan on voting yes on the contract. He feels that this is the best contract that they can get and if it's rejected then they won't get as good a contract. He also said that some people were misunderstanding the verbiage of the contract which was leading to misunderstandings of what is being proposed to the workers. He said that he'll be very, very unhappy if it's rejected.

According to Saj Ahmad of Fleetbuzz in an editorial that you can read here the brake issue that had threaten the 787 first flight (before any strike related delays came into play) have been resolved. Crane Aerospace have resolved the brake software issues.

This should clear the way for first flight depending on what happens this weekend and Boeing's own assessment of the 787 program post strike.

In the same article, Saj also reports that the A350 program is having issues of its own. The design freeze milestone was supposed to be this month. This milestone freezes the external configuration of the aircraft and starts the process for the detail design work to proceed.

Apparently Airbus is able to only do a partial design freeze. Saj reports that the final design freeze can slip to the 2nd quarter 2009 and can have consequences for Airbus' planned service entry in 2013.

Tuesday, October 28, 2008

Where does Boeing go from here?

Ok now that there is a tentative deal with IAM 751 with Boeing let's take a look at what happens here on out. First the IAM membership has to ratify the contract that it's leadership has unanimously endorsed to it's members.

Look for ratification by the end of this weekend at the very latest and the return to production very soon after that. I would say that Everett and Renton would be back on line before election day. at the latest.

Next up...SPEEA and those contract negotiations. While it is hard to predict, I do think that since SPEEA and IAM were coordinating to a point there efforts against Boeing management that the contract that was negotiated with IAM will essentially be the same contract that is presented to SPEEA and will be likely accepted by SPEEA. With the financial markets and the global economy in a tailspin it will not be in SPEEA's interest to go out on strike especially when Boeing gave a very good contract to IAM. I think this contract was aimed at both SPEEA as well as IAM and it will probably be enough to avoid and engineers strike on December 1st.

Now looking ahead to the 787, it is a pretty much a no brainer that the 787 first flight will not take place before December 31st, 2008. There is still plenty of work to do but let's assume that the work stoppage is ultimately 60 days (2 months) and add in 10 days for unknown unknowns, then first flight can possibly take place 70 days after the machinists return to work. I'm assuming that they return around November 1st so it is possible for the 787 first flight to take place as early as January 10th, 2009. But this is all dependent on many factors:

1) Before the strike Boeing was looking at factory completion of LN 1 around early to mid November which is about a month off thus the first flight could take place as early as February
2) Despite the strike there was work being done on LN 1. There was the crossing of the lines by some machinists who came under severe financial stress though it's not known if any were 787 machinists
3) LN 2 needs to be completed and under go vibration testing prior to first flight of LN 2. I hear that power may not even be on in this aircraft yet though that is unconfirmed.

Boeing will probably give a new schedule and production assessment after the machinist return to work but I think that it would be reasonable to assume that first flight will not occur until January to February 2009.

Lastly one thing to think about. The labor actions of the last couple months and the continuing negotiations with SPEEA has probably left a sour taste in the mouths of all involved. I wouldn't be surprised if Boeing starts the process of moving out airliner production out of Washington State into area which is less union friendly like Texas, Arizona an the US Southeast.

I think it's a no brainer that commercial aircraft production is on its way out at Everett. It'll probably start with 787 production moving to San Antonio and then possibly followed by 777 and 737 moving to a state(s) where the unions are not highly regarded like Alabama or South Carolina. IAM has ultimately shot itself in the foot. Certainly the Yellowstone 3 (large widebody) and Yellowstone 1 (737 RS) will be built at another location.

Monday, October 27, 2008

BREAKING: IAM and Boeing reach tentative deal

Just out on the wires:

"SEATTLE - A Machinists union spokesman has reported a tentative settlement to end a strike that has shut down Boeing Co.'s commercial airplane operations since Sept. 6.
Francis "Frank" Larkin, a spokesman for the International Association of Machinists and Aerospace Workers in Washington, D.C., told The Associated Press the deal was reached Monday evening.
Boeing spokesman Tim Healy in Seattle says he's checking on the report. The apparent breakthrough came on the fifth day of talks at the Federal Mediation and Conciliation Service in the nation's capital.
Full details were not immediately available, but according to the union's Web site, it's a four-year deal. A vote will take place in three-to-five days, once all members have had a chance to look it over.
IAM workers went on strike Sept. 6, three days after Boeing's last offer was rejected with an 87 percent strike vote. Two days of last-ditch talks to avoid a strike failed, and another round of negotiations this month collapsed in the second day.
The union represents about 25,000 workers in and around Seattle, 1,500 in Gresham, Ore., and 750 in Wichita, Kan. Key issues include job security, wages, retirement benefits and medical coverage.
But the Machinists union isn't the only one locking horns with the Boeing Company these days.
SPEEA, the union representing engineers and technical workers also has more than 20,000 members in Puget Sound. Contract talks will enter their final phase at a Seattle-area hotel Tuesday. SPEEA's two contracts, one covering professionals and the other hourly technical workers, expire Dec. 1
“If they present a last, best and final offer that doesn't reward these employees for the success they brought to the company, they may very well vote to strike,” said Ray Goforth, SPEEA Executive Director.Take the issue of outsourcing. It's not only a big issue for Machinists who want to keep outside contractors out of the plants, but also for engineers, only the issue is different.
For example, SPEEA says the company tried to outsource too much engineering work on the 787, not to mention most of the parts, leading to more than a year-and-a-half’s worth of delays. The engineers want a say in the next airplane.
“That the engineering and technical employees have a serious voice in how it's set up. There are components of these planes where it makes sense to outsource and some components where it doesn't make sense to outsource,” said Goforth.
SPEEA has only had one major strike -- 40 days in 2000. The company says it is optimistic a deal can be reached in the next few weeks and a strike averted.
“We feel we have a process that works. It's worked the past couple of contracts. In fact, the contracts Boeing's offered has been approved by 80 percent of the voters,” said Boeing spokeswoman Karen Fincutter. "

Also read IAM press release about the settlement here.

Friday, October 24, 2008

Vought may shut down North Charleston plant

In a press release, Vought is considering shutting down it's 787 operations in North Charleston. Currently, Vought has stopped production of the rear fuselage section (sections 47 and 48), reduced outside contractors, and redeployed most of the current workforce towards completing the existing sections (up to airplane 19).

Here is the relevant section of the press release pertaining to Vought's 787 production:

"787 Dreamliner Program A number of actions are being taken on the 787 program at Vought’s North Charleston facility because of the continuing Boeing IAM strike, coupled with the effects of previous 787 program schedule delays. Given that Vought has already fabricated enough barrels to support deliveries through airplane 19, the company must continue to slow its production rate and take the necessary actions across the program. Up until now, Vought has only released most of its outside assembly contractor workforce. Today, in addition to continuing this action, the company announced it is suspending its 787 composite bond fabrication operations, which will affect production and production support personnel. Assembly employees will also be redeployed to concentrate on existing fuselages closest to completion. Over the next 30 days, a variety of additional actions related to its 787 program activities are being considered, including the possible temporary shutdown of the entire plant. “This is a challenging time for all of us who support the Dreamliner program,“ said Joy Romero, vice president and general manager, 787 Program. “Since the beginning of the Boeing strike, we’ve been looking at ways to mitigate potential employee job loss in North Charleston, including the initial reduction of outside contract labor. We plan to work with our employees to identify temporary redeployment opportunities at other Vought locations, where possible. This activity will require everyone’s patience, focused attention, and best effort to ensure a smooth continuation of required work activities, while continuing to provide customer support.”

Wednesday, October 15, 2008

AMR to buy the 787

(Image Courtesy of American Airlines)
Well after years of waiting AMR, the parent of American Airlines is finally buying the 787. The surprise is that they are buying 42 of the larger 787-9s and not the 787-8. It was widely assumed that when AA pulled the trigger on the 787 order it would be for the -8 version. AMR also has options on 58 more 787s for delivery between 2015 and 2020.

Now this is not a finalized order, it's only a purchase agreement. First delivery is for September 2012 but AA must give Boeing notice of its intent to pay for and take delivery of each 787 18 months prior to delivery. AMR said in its press release that it must conclude a new contract with its pilots union prior to going forward. This means that AMR must conclude an agreement by March 2011 in order for this purchase agreement to be finalized with Boeing.

This part reminds all of us of the issue that Air Canada had when it pursued it's widebody fleet renewal with Boeing. AC had to also finalize a contract with its own pilots union before the purchase agreement could be finalized. When the pilots union rejected managements contract (due to infighting within the union) the contract was scuttled only to be resurrected some months later after the union issues were resolved.

Boeing is still dealing with its own union issues and there is no end in sight unfortunately. 787 #1 is almost all ready and was probably about a month from being shop complete when the strike hit. The engines are on and the static test airframe passed the critical high blow tests in late September with two more critical tests that need to be completed before first flight (those should be close to being completed by the end of the month). However, Dreamliner 2 must also be completed prior to first flight in order to undertake vibrations tests before first flight. Al in all it looks like first flight will be pushed to January - February of 2009 at the earliest.