747-8 challenges

The audiences I speak to around the globe, as well as readers of this blog are familiar with something we’ve said many times. Big commercial airplanes are challenging, complicated work, especially new (or major derivative) airplane programs.

We’ve gotten another sobering reminder of that today with the announcement that we’re adjusting production and delivery schedules for the 747-8 Program.

The 747-8 Freighter, which is currently in assembly, will begin deliveries in the 3rd quarter of 2010. That’s a delay from the previous plan to deliver the new freighter late in 2009. The 747-8 Intercontinental, the passenger model, will deliver in the 2nd quarter of 2011, which will be somewhat later than the previous schedule to deliver in late 2010.

image

A depiction of the 747-8 Intercontinental as it will appear in flight.

Disappointing? Yes. Acutely so for our customers, and everyone else with a stake in the success of the program. But it’s the right set of decisions. The work statement on the program has grown in order to improve some of the performance specs, and that’s led to some supply chain delays.

Much of that work-statement increase was a result of incorporating a more aerodynamically efficient wing design. Essentially, the airplane we’re building for our customers today has more new content than we originally planned. The program has also been affected by limited engineering resources within Boeing.

The impact of these issues became more pronounced as we moved through the 90% design-release milestone for the 747-8F and began production in August. Then came the strike, which began shortly after we initiated a review of the program.

We’ve worked closely with our suppliers to come up with the new adjusted production, flight test and delivery schedule (which also factors in the strike’s impact) and with customers to lessen the disruption to their plans. So now, as program chief Ross Bogue said today, it’s a matter of finishing the work to bring the airplanes to market.

But the bottom line is the new plan gives us and our suppliers time to address issues that have been affecting the program. I also want to emphasize that we remain committed to the 747-8. There’s strong demand and a good business case. The market has validated the 747-8 Freighter as the freighter of choice in the air cargo market, and we’ve secured 78 firm orders. The 747-8 Intercontinental, with 27 firm orders, continues to be well positioned in the large-airplane market as the only airplane covering the 400-500 seat market.

Now perhaps you’re wondering about the post-strike status of our other airplane programs as well. We’re assessing those schedules and will have updates down the road a bit.

Comments (11)

P.Sumantri (France):

Last October, IATA said that there was an Alarming Drop for September International Traffic. There are also reports about airlines reducing capacity.
While this delay will obviously impact BCA's financial performance, the impact on airline industry will be quite minimal.

The question is what happened to Boeing's track record.

Please visit my blog (Click here).

Norman (Long Beach, California, United States):

Things are tough and will be for a little while. The world wide recession and the subsequent reduction of air travel is taking it's toll on orders, especially for the big planes.

Their is a good business case for the 747 as it fits between the A380 and the 777 and without the 747-8 their is a massive gap in capacity.

The disappointment with me are some of the airlines like Singapore Airlines and Qantas that seem to be just disinterested in the 747-8I, and other traditional Boeing customers with 747-400's like ANA, JAL, EL AL, Korean Air, KLM, British Airways and others that have seemed take little interest in the 747-8I.


BWJones (USA):

Good luck with production and I cannot wait to see and photograph a 747-8.


Chris C (South Africa):

This is very disappointing news, to put it mildly. The 747-8 shares the stage with the super-efficient 787 Dreamliner as one of the most anticipated new airplanes of the 21st Century, and once again everyone is disappointed that we’ll have to wait a few months longer to finally see this airplane in reality.

How ironic that this sobering announcement on the 747-8 programme would be announced on the 3rd year anniversary of the official launch of the new 747! Three years ago, to the very day, there was great excitement with the launch of the new, advanced and highly-efficient 747-8, and today we sit in some very worrying times indeed.

Whilst the 747-8F has indeed enjoyed stellar success, the 747-8 Intercontinental has not been the success Boeing had hoped for in terms of orders, yet. The -8I is an excellent airplane, but it has not had it easy over the last few years or so. We’ve all slowly witnessed the -8I, since 14th November 2005, change into a whole new creature, and have also witnessed the market for 400seat and larger airplanes continue its contracting trend.

This year it has been particularly difficult for large airplanes with the global financial crisis and the fear of non-supporting traffic volumes for such large airplanes...the market for 747-8s and larger airplanes is just a very risky market to venture into now.

With the delays announced for both the -8F and -8I, Boeing no doubt will drive further efficiency into these airplanes through weight reductions amongst aerodynamic tweaks to the highly-advanced, aerodynamically all-new super-critical wing. All the best with the steadily progressing sales campaigns to sell more -8Is and -8Fs...this airplane family will be a big success, and also like the 787, a very valuable learning curve for Boeing.

http://www.fleetbuzzeditorial.com/2008/11/06/747-8/
http://www.fleetbuzzeditorial.com/2008/11/14/747-8setback/

Paulo M (Johannesburg, RSA):

Disappointing, but as the rest say not unexpected. The 747-400 had some of that in its early days, and it turned out alright. The 777-200LR was delayed because the market could not support it in the earlier planned schedule.

So it got pushed out a bit so the company could focus on the more important 777-300ER, with the bigger potential market. And by the time the market did bounce back, Boeing was ready with the 772LR, and the derived 777 Freighter. The most important thing right now is getting the 787 in the air - the delayed 787 is the reason for knock-on delays on the 747-8, because of engineering and technology transfer. And to do that means a thorough D check of the entire system.

Of all the bad news out there, none is as disappointing as the production issues on the Guppy & Fat Albert. But kudos goes out to Boeing for notifying the FAA and affected parties in due course, without delay.

Kinbin (Taipei, Taiwan):

The competition for limited resources has finally reared its ugly head into this new delay.

Are the engineering and supply chain resources going to be assigned to the 787 or the 748? Which is more important?

As we are all aware, there is a shortage of experienced engineers in the market, and in Boeing. That includes the independent engineering houses that Boeing contracts to. They are all in the "pool".

Design changes and tweaks in the 787 require engineering headcount that is competing with new 748 requirements.

Suppliers who provide the parts on the 787 (yes, there are metal parts on the 787 as well) are from the same pool for the 748 as well.

With the market meltdown cascading into the manufacturing industry in the US, the aviation supply chain is bucking this trend.

Boeing ought to capitalize on this unique opportunity to ramp up on resources, and assist the supply chain to take on more capacity to mitigate the delays.

Delay announcements that come by every so often continues to put in dents on Boeing's credibility, and on future sales campaign, which is expected to only intensify.


Chris C (South Africa):

With customers and suppliers already notified of the revised design, development and production schedule for the phenomenal 747-8I and -8F, Boeing has some good margin ‘installed’ into the programme that should allow for weight-issues to be resolved and for some significant performance gains to be incorporated into the -8I and -8F.

We could well see, during flight-testing as well, that the -8I is capable of a range in excess of 8,400nm with full load of passengers. We could also see the grounds for a -8ERFx concept, and heck, even the grounds for a 747-9I based on the shelved 747-600x concept...it is a 747 after all, and thus an immensely capable platform. All customers remain 100% committed to the 747-8 family, and there’ll be more customers signing up for both variants in the coming months, no doubt.

Chris C (South Africa):

With Japan-based All Nippon Airlines eyeing the 747-8I, Boeing no doubt will be pulling out all the stops, ethically, to secure a firm order from the airline for the next generation 747-8I. Should ANA opt for an airplane larger than formidable 777-300ER, no doubt that the airline will decide to go ahead with the highly-efficient and ultra-capable 747-8I, as this airplane offers the lowest operating costs of any large airplane amongst a long list of other superior advantages.

Boeing stands a good chance to boost the -8I order book with a solid order from ANA. All the best with this sales campaign...it’ll be tough, as they always are, and very close, but I’m sure the -8I will prevail! It’s an incredibly good airplane.

Jun Leido (Manila, Philippines):

I just flew to and from the US on a Cathay Pacific 747. I think there is no replacing the real Queen of the Skies. This is why I am disappointed that the 747-8 is launching on little new technologies, except the engines, to assert itself in its market. Maybe Boeing is no longer the trailblazing and pioneering company it was when it built the 707 and 747; maybe it's now a number-crunching, stock-value obsessed company holding office far away from where it all started it's story.

One thing I noticed during our flight, we passengers wanted space - like a communal space, where we can stand, chat a bit and have snacks. We ended up commandeering the galleys, to the FA's dismay. I hope the new 747-8 will have more of this space.

Bob R (Lynnwood, WA, USA):

The 747-8F's roll-out must be imminent. With all the bad news about Boeing lately (e.g., 787 second line to South Carolina, and very late on the 787-8), will the company celebrate the unveiling of the -8F with a well-publicized ceremony?

BiobioMine:

CargoLux currently has 12 747-8F aircraft in its fleet with one of its final two aircraft entering final assembly in the coming weeks and the other next year. Nippon Cargo Airlines currently has eight 747-8F aircraft in its fleet, and it has six more on order.

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