December 2013 Archives

Year in review

As we close in on the end of the year and the annual Boeing holiday break, our teams are still very busy building airplanes and selling them. Today, Cathay Pacific became the first 777X customer in Asia after ordering 21 777-9Xs.

Earlier this week, we earned type inspection authorization (TIA) for ZB021, our 787-9 powered by General-Electric GEnx engines. It comes just a few days after we earned TIA for 787-9s powered by Rolls-Royce Trent 1000 engines.

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The third 787-9 test airplane, ZB021, is powered by General-Electric GEnx engines.

Also this week, we delivered the first 747-8 with performance-improved engines to Cathay Pacific. It’s the first of the performance package’s three improvements to enter service—as we keep investing to make the 747-8 even better.

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A Cathay Pacific Airways 747-8 Freighter was the first 747 to deliver with the performance-improved engines.

While we’ve had our challenges in 2013, we’ve also had plenty of reasons to celebrate where we’ve been—and where we’re going. I’ll leave you with a photo gallery of my favorite moments from the past year. I hope you and your family enjoy the holidays and I look forward to seeing you back here in 2014.

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The new Everett Delivery Center opens to rave reviews.

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A 787 for Air India performs during the flying display at the Paris Air Show.

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There were smiles all around at the launch of the 787-10 at the Paris Air Show. ALC Chairman and CEO Steven Udvar-Hazy (left) and Boeing Commercial Airplanes President & CEO Ray Conner celebrate.

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Ray Conner greets Ryanair’s Michael O’Leary at the Paris Air Show. Ryanair finalized an order for 175 Next-Generation 737-800s.

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The first 767 Freighter for FedEx Express.

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Boeing employees cheer the 787-9 first flight.

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The 787-9’s first flight takes it past Mt. Rainier.

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The 777X is officially launched at the Dubai Airshow. Here’s me with Scott Fancher, vice president and general manager of Airplane Development, standing next to the 777X model.

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What else would I end with— food! Here’s my favorite street market in Paris.

Financing forecast

As always, the end of the year is a busy time for our delivery centers. And my colleagues at our financing arm, Boeing Capital Corporation (BCC), are making sure our customers have the financing they need to fly away with those airplanes.

BCC just announced its financing outlook for 2014—and the news is good. Boeing projects there should be adequate financing at reasonable prices to support what’s expected to be record airplane production around the globe.

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The cover of Boeing’s latest Current Aircraft Finance Market Outlook features the 787-9 Dreamliner.

BCC’s Kostya Zolotusky says the financing watchwords for next year are realignment and balance. Realignment as in the dollars used to pay for new airplanes moving from one funding source to another, with banks and other commercial market sources growing in their contributions—and export credit borrowing declining.

As for balance, Boeing expects to see an almost even distribution among those sources - the banks, the commercial markets, the leasing companies and the export credit agencies. That balance stems from industry conditions like steady air travel demand and a replacement market driven by new, more fuel-efficient airplanes.

Engineering and economics — working hand in hand to meet the needs of our customers.

Won't you guide my sleigh tonight?

All of our customers are special to us. But this year, our subsidiary Jeppesen went to some unusual lengths to make sure one customer got the VIP treatment—even though this customer flies reindeer instead of airplanes.

Jeppesen has been creating navigational charts from scratch for more than eight decades, using raw source data from reporting agencies around the world. So they jumped at the chance to help Santa Claus when he asked for a tailored approach as guidance for his reindeer to the international workshop at the North Pole.

The chart for the jolly old elf comes complete with a hot cocoa de-ice pad located next to milk/cookie overflow storage, UNICOM changed to ELFCOM, and Red/White ramp markings on sizable ramp facilitate flow for the most efficient toy loading. You can check out Jeppesen’s chart for Santa here, and see a video below.

And just in case you somehow missed another holiday video that’s been getting worldwide attention, check out this wildly creative campaign by our customer WestJet.

New phase

I’m pleased to announce that our 787-9 team is starting a significant new phase of flight testing after earning type inspection authorization (TIA) for the airplane. The FAA will now bring its personnel to join the Boeing team on 787-9 test flights to gather the data required for certification.

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The 787-9 during flight test. Photo by John Parker.

The authorization applies to 787-9 test airplanes powered by Rolls-Royce Trent 1000 engines, which are ZB001 and ZB002, the first two members of the fleet. We expect to earn TIA soon for the third 787-9 test airplane, ZB021, which is powered by General-Electric GEnx engines.

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The first three 787-9 airplanes in a group photo at Boeing Field. Photo by Adam Tischler.

With more than 100 flights and 285 hours in the air so far, the 787-9 fleet continues to fly extremely well. To earn TIA, Boeing Test & Evaluation test crews flew the 787-9 fleet at a variety of speeds, altitudes and configurations to demonstrate the capability of the airplane throughout the flight envelope. For example, Boeing successfully completed flutter testing for the 787-9 fleet, demonstrating structural integrity. Test crews also put the airplanes through various maneuvers at high speeds to try to induce vibration into the airframe and demonstrated it dampened out without problems.

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Photo by John Parker.

Now, test crews will begin exploring extreme operations with the 787-9, including very hot and cold weather.

With the dedicated flight test fleet complete and the fourth airplane now in ground test, we’re on track to complete 787-9 testing in the spring, followed by certification and delivery to launch customer Air New Zealand in mid-2014.

It’s been a busy end of the year for the 787-9 team. Congratulations on these great accomplishments.

New twist on an old tale

This week, Airbus held a seminar in London on the A340. Yes, the same A340 that went out of production two years ago. It seems Airbus is trying to reassure nervous stakeholders that there’s still life in this airplane.

What’s at stake for Airbus? Quite a bit. They’re trying to bolster the value of these airplanes since it’s speculated that Airbus has a potential liability on RVGs (Residual Value Guarantee) for the A340-500 and A340-600 that could total $2 billion USD.

I’ve seen a lot of coverage that came out of the Airbus seminar, mostly focused on the same old claims about the A340’s capabilities. The fact is, the A340 came to an early end because airlines didn’t want to buy it. It couldn’t compete with the 777 because it was inefficient (the 777-300ER proved to be 30+ percent more fuel efficient per seat than the A340-600), had high maintenance and operating costs, poor reliability, and offered a passenger experience that couldn’t compete with the 777.

One of the more interesting nuggets to emerge from that A340 seminar was the idea to reconfigure the airplane with narrow seats, narrow arm rests and narrow aisles to increase seat count. It’s what John Leahy called “revolutionizing A340 economics.”

But John apparently forgot what he was pushing just a few weeks ago—an industry-wide standard of 18-inch seats on long haul airplanes. So what would a seat look like on these revamped A340s? 16.7 inches… well short of Airbus’ own standard.

In our view, passenger experience isn’t just measured by the width of a seat. That’s why we continue to work with our customers to give them the flexibility to showcase their brand, provide a great overall passenger experience and provide the economics that work for them and their passengers. It’s hard to go wrong when you listen to the customer.

 

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