Numbers Game

Here’s a question: when is a year not really a year? When it comes to making airplanes, the answer is all in the math.

As the market keeps demanding more and more airplanes, we here at Boeing keep upping our production rates to make sure the supply meets that demand. Last week, Airbus followed by announcing a rate increase for the A330 family (since the A340 is no longer being mentioned, I guess it is unofficially out of production).

But beware of how production rates are calculated. There are some major differences between Boeing and Airbus.

Boeing factors down time into production. In other words, down time is absorbed. But at Airbus, down time isn’t factored into the equation. Each year, Airbus loses about a month of work on its wide-body production and about half a month on its single-aisle planes. But they don’t account for that missed time in their production rates.

Here’s an example. We recently announced that our 777 production rate will increase to 8.3 a month in 2013. Airbus has now followed by increasing its wide-body plane production to 10 a month in 2013, which you may assume works out to 120 planes a year. But if you factor in the lost month of work, the real number is 110.

Boeing 777

8.3 x 12 (months) = 99.6 planes a year

Airbus A330 family

10 x 11 (months) = 110 planes a year

On the single-aisle side, production of our 737 will jump to 38 a month in 2013. Airbus plans to increase single-aisle production to 40 a month in 2012. If you factored in the half month of lost work, what you’d expect to be 480 ends up really being 460.

Boeing 737

38 x 12 (months) = 456 planes a year

Airbus A320 family

40 x 11.5 (months) = 460 planes a year

photo

Next-Generation 737s on the production line in Renton.

It really is like comparing apples and oranges. Or maybe oranges and lemons. I’m not saying the way we calculate the rate is better—it’s just different.

Comments (15)

Freddy Hagens (Everett, WA):

Oranges and lemons? That is very funny!

Is the shorter production time of 11-11.5 months in any way linked to the longer European vacations authorized by the respective countries?

Howard (Key West, FL):

Can you advise how ZA102 fits into the development program? Is this the first a/c for ANA?

nicolas (Montreal):

You want real numbers, use real numbers:

737 family 2010 deliveries: 376
A320 family 2010 deliveries: 401

777 family 2010 deliveries: 74
A330 family 2010deliveries: 87

James Baloun (Palo Alto, California):

Any manufacturer ultimately must answer to their stakeholders. Disclosure and transparency have to meet the legal requirements of publicly traded companies and be balanced with the need to protect proprietary information and advance the business strategy. Numbers, such as monthly production rates, annual sales, or government low-risk loans can be spun for whatever publicity gain they may yeild. As a airline traveler I am way down the list of stakeholders and my opinion carries a similar weight. Still some manufacturers, including Airbus, leave me skeptical. Playing politics is all well and good as long as the sun is shining and nobody gets hurt. But I am left wondering 'where does the spinning stop?' If I can't trust them with the little things, how can I trust them with the big things? In spite of our best efforts, accidents eventually happen and then the truth comes out. I am glad that Airbus makes products that can ditch in a river or sustain multiple uncontained turbine blades without a single loss of life. We learn the hard way there is a limit to the spin. I just wish they were a little more transparent in their public statements, made for concumption by us, the flying public.

Javier Irastorza (Toulouse, France):

As you said it's just a different way of counting.

However, I wanted to comment on the oranges and lemons... when I saw the underlined "lemons" with a link behind, I feared a more bitter website would appear (http://en.wikipedia.org/wiki/The_Market_for_Lemons) :-) I gladly discovered a song.

Paulo M (Johannesburg, RSA):

Real rates then 38.33 for the A320 & 9.17 for the A330/A340. Accounting always helps. But technically they're not fibbing, they still working with 3 months. And, their orders and deliveries reports are typically released well past mid-January.

Vero Venia (Montreal, Quebec):

Is it important to compare production rates? I don't think the market considers those numbers as an important indicator.

Tim k (Ont Canada):

I believe you just took a shot at your own company!

If we use the numbers you provided we can say that Airbus produces more planes plus it manufactures them in less time than Boeing takes every year.

Unless I missed something just exactly what was the point you where trying to make here?

Paulo M (Johannesburg, RSA):

Just a correction of my post -- not sure where I got 3 months from. It's operating 12 months within a 13 month period.

Andrew (Seattle, WA):

"nicolas (Montreal):
You want real numbers, use real numbers:

737 family 2010 deliveries: 376
A320 family 2010 deliveries: 401

777 family 2010 deliveries: 74
A330 family 2010deliveries: 87"

Good for Airbus! Those few extra planes should help them pay back all of their illegal subsidy money...

Tom (Germany):

Randy,

be fair! You know the needs in marketing!

There are no wrong data! Did Airbus say that it will produce 120 A330/A340 p. a.?

What about orders, orders from China?
Did Boeing release any wrong news?
Some press people called it a marketing gag...
One should read the press releases as they are.
If there are questions... contact Boeing...!
Or Airbus!
Typically one will ask for p.a.-nummbers!

Norman (Long Beach, California, United States):

Airbus has a small production edge on the twin wide body and single aisle market. When it comes to the 737 and the A320neo, I think Boeing must do what it can to keep the 737 at the highest competitive edge as well as the 777 against the A350.

Randy Tinseth (Renton):

Nicolas,

No question the numbers are the numbers. As expected, in 2010, Airbus delivered more aircraft than Boeing.

Your example truly illustrates the point of my posting.

In 2010, Airbus claimed a production rate for the A330 at 8 aircraft/month. They delivered 87 A330's. Isn't that about 8 times 11?

Also, as stated many times, our rate on the 737 was about 31.5 per month -- isn't 376 pretty close to 31.5 times 12.

Doh (Bothell, Washington, US):

IMHO, Airbus sold more airplanes than Boeing because they were able to sell them at or below cost in cut-throat competition (the real prices were never disclosed by either the airlines or the manufacturers). The EU governments have subsidized Airbus MANY TIMES more than what Boeing received from local and federal governments as per the WTO rulings. In addition, Airbus doesn’t have to pay for their employees’ health care to further their advantage. In a nutshell, this is a large scale product dumping sponsored by the EU governments.

Ross Lamagna (Essex Montana):

Airbus should play by the rules. There is NO question about that. It is hard for Boeing to compete against a HEAVILY Subsidized Airbus. NOT FAIR!!! Airbus doesn't make planes as good as Boeing, but they are a VERY strong competitor. The A330 has bit the heals of the 767. A340 and A380 bit the heals of the 747, and A350 is supposed to bite the heals of the 777 and 787. Airbus likes to crow that their planes are bigger and better than Boeing planes. Bigger doesn't make it better and Airbus isn't better than Boeing.

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