Boeing 797 Thread - 2019

frmrCapCadet · Sun Feb 03, 2019 2:03 am

The big secret is whether or not the plane will be launched. Even Boeing does not know for sure yet - so neither engineers nor Airbus know.

flee · Sun Feb 03, 2019 3:29 am

RJMAZ wrote:
The 797 engines will never appear on an Airbus aircraft, Boeing will prevent that from happening again in the contracts.

Two engines come to my mind - the GE CF-6 and CFM-56 families. These were hugely successful engines that were put on many airframe designs, both civil and military. The huge amount of sales has guaranteed that these engines do not cost too much to acquire and to maintain. The CFM LEAP appears to be heading this way too and it will help to keep costs down on both the A320 and B737.

Both Airbus and Boeing know that they can only keep engines exclusive to their own airframes but cannot prevent engine manufacturers from selling them to other manufacturers. Both Airbus and Boeing know that the higher the production volume, the lower the costs. So I doubt if Boeing will want to stop the engine manufacturers from selling their engines to others.

The NMA is not going to sell in 737 volumes - so its costs need to be carefully controlled. Having a high volume production engine will help.

JayinKitsap · Sun Feb 03, 2019 4:12 am

I work in a number of buildings that require clearance, some offices I was not told what contractors were in the building and I was not to ask questions other than what was needed to design the building changes, the 'need to know' concept. The Navy's most decorated submarine "USS Parche" had most of its medals Classified, only many years later some of what it did leaked out.

https://www.businessinsider.com/us-navy ... ons-2018-6

Keeping things secret is easiest if within Company, if one of your vendors also works for the competition there is higher potential. In a digital model system that is closed off from the net, nor can mobile devices connect in, plus no phones or cameras in the work space it is hard to move data of significance come out. NDA's with the biggest employer in your industry are a big deal, unless you don't want to work again. It does surprise me how little we know of this, but Boeing is building up a lead time.

ATO is needed to be in place before a public stock company discusses new offerings with any detail. Otherwise insider trading issues are quite easy to happen. But launch could be held off until like 500 orders are ready, changes how a response can be made.

RJMAZ · Sun Feb 03, 2019 4:37 am

frmrCapCadet wrote:
The big secret is whether or not the plane will be launched. Even Boeing does not know for sure yet - so neither engineers nor Airbus know.

You have no evidence of this. All the evidence points to the exact opposite.

Boeing is clearly delaying or limiting public information on the 797 to mislead Airbus. It is ridiculous for you to assume that Boeing is undecided if they will even produce the 797 at all.

Boeing will definitely be producing the B-21 bomber yet no public launch with photos or specifications have been made.

If Boeing was undecided if they will produce the 797 they would not have 1000 engineers building the thing.

If the Boeing fanboys want to help Boeing they should all start spreading rumours that Boeing has no business case. Airbus will hear all these rumours and think the 797 will not happen and not plan for a response.

I'm actually tempted to delete all my comments on this. And start posting that the 797 probably won't launch as the market is too small. It seems only a few members here can see the 797 is definitely happening.

morrisond · Sun Feb 03, 2019 5:15 am

Good post RJMAZ

BTW it's Northrup that's building the B-21

RJMAZ · Sun Feb 03, 2019 5:56 am

morrisond wrote:
Good post RJMAZ

BTW it's Northrup that's building the B-21

Cheers. I was thinking about Boeings MQ-25. But yes Northrop Grumman has kept every detail secret on the B-21. There would be many secondary suppliers that could leak specs yet we hear nothing.

With the 797, Boeing would no doubt approach trusted blue chip airlines first and get firm commitments. These airlines will not leak any information.

The closer we get to the public launch Boeing will approach smaller airlines with exact specs and we will get more leaked information. We know so little about the actual size of the 797. It could be plus or minus 25% of what we think. It could be tight 7ab with a MTOW of 120T or 8ab with a MTOW of 180T.

seahawk · Sun Feb 03, 2019 8:21 am

And with the close GE partnership, the engine could be on the test rig the day they launch. Boeing has learned a lot from the 787 and it different company today and they are serious about taking back the dominant role in the airliner market.

flee · Sun Feb 03, 2019 8:33 am

seahawk wrote:
And with the close GE partnership, the engine could be on the test rig the day they launch. Boeing has learned a lot from the 787 and it different company today and they are serious about taking back the dominant role in the airliner market.

Boeing only called for engine RFPs in the second half of 2018 and no engine manufacturer partner(s) has been chosen yet. It is still in very early stages and if a test engine is ready by 2020, it will likely be a development of a current engine like the CFM LEAP or PW GTF. RR has only progressed to the Advance design and their Ultrafan has yet to make an appearance.

QuarkFly · Sun Feb 03, 2019 8:43 am

seahawk wrote:
And with the close GE partnership, the engine could be on the test rig the day they launch. Boeing has learned a lot from the 787 and it different company today and they are serious about taking back the dominant role in the airliner market.

Boeing launched the 777X in 2013. It will not be delivered until 2020 (if things go well)...and the 777X is a derivative of an existing aircraft, not an all new clean sheet design. Also, Boeing was working on the 777X since 2011 or earlier when Airbus announced the A350.

If the 797 is launched in 2020...plan on 2027 entry in service...if there are no development problems (there always are !!).

QXAS · Sun Feb 03, 2019 9:22 am

RJMAZ wrote:
GEUltraFan9XGTF wrote:
Boeing could keep us all guessing and then surprise everyone with a public rollout of a flyable plane, only then making it public. There is no official timeline for such things.

Exactly.

If I was Boeings CEO with the full support of my shareholders all of my products would be developed in secret with non disclosure agreements on my customers and suppliers. I would rollout a flyable plane at the official launch with multiple airlines CEO's standing beside me with a huge 1000+ order book.

The competition wouldn't know what hit them. My aircraft would be alone on the market for many years before the competitions reply became available.

With Boeings amazing financial situation they can easily fund the 797 without any deposits or official orders from airlines.

I’d take it one step further, I’d roll out the flyable plane in the middle of the night and fly it to Paris/Farnborough, making sure to arrive into the traffic pattern right after the A321NEO demonstration flight. Publicly launch it at the air show as the prototype touches down in the background.

RJMAZ · Sun Feb 03, 2019 9:38 am

QuarkFly wrote:
Boeing launched the 777X in 2013. It will not be delivered until 2020 (if things go well)...and the 777X is a derivative of an existing aircraft, not an all new clean sheet design. Also, Boeing was working on the 777X since 2011 or earlier when Airbus announced the A350.

If the 797 is launched in 2020...plan on 2027 entry in service...if there are no development problems (there always are !!).

You miss the point and the 777X is a bad example.

Boeing had incentives to launch 777X as early as possible. The A350-1000 was just launched to attack the core 777W market. The 777X launch was to show existing 777W customers knowing that Boeing would have the best replacement. Some 777 customers may have decided to jump onto the A350 bandwagon.

So the 777X would have been launched with very little if any development work done. As they had plenty of time until the 777W replacement cycle began they most likely allocated ess resources to the first few years of development. The 787 ramp up and 737MAX would have consumed much of the engineering resources.

The 797 is a different ball game. Airbus could do a reply 5% bigger like they did with the A350. Boeing wants to delay that reply.

PW100 · Sun Feb 03, 2019 12:36 pm

RJMAZ wrote:
You have no evidence of this.

Well duh, you have no evidence of your position either.

morrisond wrote:
BTW it's Northrup that's building the B-21

That just shows the level of secrecy here . . . .

PW100 · Sun Feb 03, 2019 12:40 pm

RJMAZ wrote:
You miss the point and the 777X is a bad example.

Yes, the little 737 Max is a much better example, which was less than 5 years from public launch to EIS. Oh wait . . .

morrisond · Sun Feb 03, 2019 1:21 pm

morrisond wrote:
BTW it's Northrup that's building the B-21

That just shows the level of secrecy here . . . .[/quote]

That I revealed publicly available information? There was a competition and the winner (Northrup) was publicly announced.

Other than that and a very basic silhouette there is no hard data on what it is out there.

morrisond · Sun Feb 03, 2019 1:32 pm

It could just be Boeing trying to goad Airbus into launching an A321 With a new wing so it arrives before 2025. They may not want Airbus to clean sheet a new design as that may make it too competitive with NMA/NSA.

I'm guessing (as many have pointed out) it's as much about an very efficient design as it is an very efficient to build design giving Boeing a further cost advantage/profit margin advantage which Airbus can't get unless they clean sheet and redo there whole production philosophy/system.

That may be harder to do (match Boeing Production costs with an A320 re-wing) given the political nature and Union strength in a lot of Airbus factories unless they clean sheet and start from scratch. Given the amount of jobs involved it could take Airbus years to figure that out just on the work share issues alone.

NMA will most likely be built in South Carolina or Washington. They have extra room in South Carolina to green field or 747 could be done by then and they could use that space.

Eyad89 · Sun Feb 03, 2019 3:20 pm

RJMAZ wrote:

I would rollout a flyable plane at the official launch with multiple airlines CEO's standing beside me with a huge 1000+ order book.

You are assuming that airlines would happily keep their mouths shut?

If Boeing launches the NMA formally or informally, then the first thing that airlines would do is to urge Airbus to launch a competitor. That’s exactly what happened in the past. Airlines could get cheaper and more diverse options that way. Airlines seek their own interests after all.

frmrCapCadet · Sun Feb 03, 2019 3:30 pm

RJMAZ wrote:
frmrCapCadet wrote:
The big secret is whether or not the plane will be launched. Even Boeing does not know for sure yet - so neither engineers nor Airbus know.

You have no evidence of this. All the evidence points to the exact opposite.

Boeing is clearly delaying or limiting public information on the 797 to mislead Airbus. It is ridiculous for you to assume that Boeing is undecided if they will even produce the 797 at all.

Boeing will definitely be producing the B-21 bomber yet no public launch with photos or specifications have been made.

If Boeing was undecided if they will produce the 797 they would not have 1000 engineers building the thing.

If the Boeing fanboys want to help Boeing they should all start spreading rumours that Boeing has no business case. Airbus will hear all these rumours and think the 797 will not happen and not plan for a response.

I'm actually tempted to delete all my comments on this. And start posting that the 797 probably won't launch as the market is too small. It seems only a few members here can see the 797 is definitely happening.

Actually I have every bit of evidence needed. Boeing has not authorized or offered the plane for sale. They may be on the knees, but ring is in a box, not quite decided whether or no to offer - the bride(s) await the words, "Will you marry me?" There have been various proposals for secret machinations, fooling airbus, and etc. Secrets I do not believe. And I will restate my views.

'Yesterday, 8:14 pm

The numbers bandied about for development of a NMA have been most often $15 billion. Does anyone have a guess for how much of that they will have spent now and also by the end of the year? Even if it were $4 billion and a decision for a no-go it would be far cheaper than the cock-up in R and D, and deferred production costs for the 787. If we were to assume a 7 year from initiation to EIS, some of that time could be ascribed to 2018 and 2019.

I continue to believe that Boeing has to go ahead with one new model in the next few/several(?) years. Building civilian planes is the biggest part of their business, and while the MAX and 777X are impressive they both have their limitations (MAX in capability and X in size of the niche). It could be said that for Airbus the 320/350 may well be in their primo time, whereas Boeing only has the 787 in primo.'

I think the plane will be built. But they still can say no. That is secret.

morrisond · Sun Feb 03, 2019 3:38 pm

According to Boeings financial statements - the last two years Boeing has spent about $3.1 Billion on R&D - for 2019 they are forecasting $4.1 Billion. Given that MAX is pretty well done (except for -10 minor Stretch) and 777X major engineering is done as well - what accounts for the big increase? Half or more of the $4.1 could be NMA work.

Revelation · Sun Feb 03, 2019 3:42 pm

morrisond wrote:
According to Boeings financial statements - the last two years Boeing has spent about $3.1 Billion on R&D - for 2019 they are forecasting $4.1 Billion. Given that MAX is pretty well done (except for -10 minor Stretch) and 777X major engineering is done as well - what accounts for the big increase? Half or more of the $4.1 could be NMA work.

Yes, but they also just won the T-X military trainer and MQ-25 Navy drone tanker contracts which will involve a lot of ramp up spending, whilst perhaps KC-46 may be winding down now that USAF is accepting deliveries. It's hard to draw conclusions.

Planeflyer · Sun Feb 03, 2019 4:30 pm

Let’s also keep in mind that BA’ s cash flow generation provides tremendous flexibility.

Lewton · Sun Feb 03, 2019 4:43 pm

RJMAZ wrote:
frmrCapCadet wrote:
The big secret is whether or not the plane will be launched. Even Boeing does not know for sure yet - so neither engineers nor Airbus know.

You have no evidence of this. All the evidence points to the exact opposite.

Boeing is clearly delaying or limiting public information on the 797 to mislead Airbus. It is ridiculous for you to assume that Boeing is undecided if they will even produce the 797 at all.

Boeing will definitely be producing the B-21 bomber yet no public launch with photos or specifications have been made.

If Boeing was undecided if they will produce the 797 they would not have 1000 engineers building the thing.

If the Boeing fanboys want to help Boeing they should all start spreading rumours that Boeing has no business case. Airbus will hear all these rumours and think the 797 will not happen and not plan for a response.

I'm actually tempted to delete all my comments on this. And start posting that the 797 probably won't launch as the market is too small. It seems only a few members here can see the 797 is definitely happening.

That would be really sneaky.
We all know that Airbus' management is ritually gathering to read your comments every morning in order to calibrate their company's long term strategy.

morrisond · Sun Feb 03, 2019 5:10 pm

Yes - impossible to know split between Commercial and Defense R&D spending of $4.1B for 2019

Out of the $3.1 B spent on R&D last year $2.1 was the commercial airplane division.

Max -10 would have been part of that - but couldn’t have been more than a few hundred million - and finishing up 777x - but $2 Billion?

The 777x prototypes were being built - but I thought those costs were allocated to the program and not R&D?

When they wrote off the early 787’s did they not take them out of the program and write them off to R&D at that point?

A bunch of that $2billion could have been spent on NMA - 1,000 Senior (assuming senior in the early stages to do main design) engineers aren’t cheap and they could be building test barrels and prototyping production systems.

Revelation · Sun Feb 03, 2019 5:21 pm

Planeflyer wrote:
Let’s also keep in mind that BA’ s cash flow generation provides tremendous flexibility.

Indeed, but I think they are being super cautious. I think they really want to change how much revenue they get over the aircraft's life span. They're willing to play hard ball with the vendors till they get the kind of terms they want. If you look at the financials, Boeing Global Services had record numbers this year and is on a huge growth trajectory. The C-suite realizes now is the time to change the way the game is played, and if they can do that, they will capture decades of profits. On the flip side, if the vendors create their own profit lock in mechanisms they may never put the genie back in to the bottle and they will be remembered for giving away the family jewels. They realize it can all go badly if they try to do it all at the same time (see: 787) so they're being super cautious about working things out before they go full throttle.

Planeflyer · Sun Feb 03, 2019 5:32 pm

Revelation wrote:
Planeflyer wrote:
Let’s also keep in mind that BA’ s cash flow generation provides tremendous flexibility.

Indeed, but I think they are being super cautious. I think they really want to change how much revenue they get over the aircraft's life span. They're willing to play hard ball with the vendors till they get the kind of terms they want. If you look at the financials, Boeing Global Services had record numbers this year and is on a huge growth trajectory. The C-suite realizes now is the time to change the way the game is played, and if they can do that, they will capture decades of profits. On the flip side, if the vendors create their own profit lock in mechanisms they may never put the genie back in to the bottle and they will be remembered for giving away the family jewels. They realize it can all go badly if they try to do it all at the same time (see: 787) so they're being super cautious about working things out before they go full throttle.

Agree completely!

The digital design initiatives underway enable robust design and follow on services.

Way long BA

Planeflyer · Sun Feb 03, 2019 5:35 pm

I should have added that ba’s financial results are reflective of their no wine before its time product development approach.

As the 787 demonstrates they can make big mistakes but rarely about market size.

Revelation · Sun Feb 03, 2019 6:28 pm

morrisond wrote:
Yes - impossible to know split between Commercial and Defense R&D spending of $4.1B for 2019

Planeflyer wrote:
The digital design initiatives underway enable robust design and follow on services.

I think we can put it together by researching the T-X.

AvWeek ( http://aviationweek.com/defense/boeing- ... me-changer ; free registration required ) says:

While proving a resurgence in its ability to capture new programs, Boeing’s win of the U.S. Air Force’s T-X trainer also may mark a turning point for the business model at the company’s defense division.

Much as commercial aero engine companies moved years ago toward selling their powerplants below cost to secure marketshare, with the intent of making money later on aftermarket services, Boeing Defense may be headed in the same direction.

Basically, for T-X the push was to spend the time up front (even building and flying two prototypes) to convince themselves they could offer lower prices up front to gain access to aftermarket profits later. I think much of the large amount of R&D spending went in to the (virtual and physical) tools needed to produce these prototypes and validate the results, along with the work needed with the supply chain to make sure the pricing was sound.

Now I'm not saying that BDS and BCA will follow the same business models since their markets work differently, but I am saying they are both strongly motivated to find new business models that capture more of the product's lifetime revenue.

They are working from a position of strength:

Boeing, however, is far more diversified: its commercial aircraft backlog stood at $433 billion at the start of the year, while Boeing Defense was sitting on $50 billion in work, according to the last annual regulatory filing. In addition, the corporation has set a target for the year-old Boeing Global Services division to reach $50 billion in annual revenue by the early 2020s, and it is already around $15 billion.

This article is six months old, whereas https://www.aviationtoday.com/2019/01/3 ... 8-revenue/ says:

Boeing's fledgling Global Services division saw 17 percent YOY growth, from $14.6 billion to $17 billion, bolstered by a fourth quarter in which the acquisition of parts distributor KLX helped the segment achieve revenue increases of 29 percent YOY.

Seems they are ahead of target.

The first article says:

Boeing executives spotlighted the company’s turn toward services in July. “This is a bigger market in the long term than the aircraft market,” Boeing’s chief commercial aircraft salesman, Randy Tinseth, said during the Farnborough Airshow. “We only have 7% [services] market share, so what a great opportunity as we grow to expand our share.”

So everyone involved knows where things are heading.

It doesn't look good for vendors:

Part and parcel to achieving those margins has been Boeing’s supply chain squeeze, the Partnership for Success program, and it came into play with T-X. A year ago, Boeing chose Triumph Group as a key supplier for Boeing’s bid. That selection came as Boeing was finalizing a master contract arrangement with Triumph, as has been done with several other Tier 1 and 2 providers. Triumph is in the midst of a restructuring and streamlining in part to profit after meeting Boeing’s terms.

The squeeze was on for T-X, as it almost certainly is for NMA.

It is largely enabled by using new technology in the production/manufacturing space:

The degree of cost-cutting implied by Boeing’s bid for T-X also may hit at other technology breakthroughs. In 2015, Aviation Week & Space Technology reported on the “Black Diamond” project within Boeing, which sought to transform its defense production system with low-cost manufacturing techniques.

“Naturally, Black Diamond played a role,” Merluzeau says. “The per-unit price demonstrates near-‘Scaled Composites-like’ costs.”

Hopefully the business case will close and we'll learn more about what role all of these things play in the NMA program.

GEUltraFan9XGTF · Sun Feb 03, 2019 7:00 pm

I completely agree that Boeing could take a "military style" approach to NMA if they want to: develop in secret, leak few / misleading details, and then roll out a few prototypes to much shock and awe. Imagine roll out a few days before Paris and then flying one or two copies to Paris to much fanfare? Completely possible. And perhaps necessary. Something Leahy would also totally respect.

PlanesNTrains · Sun Feb 03, 2019 7:04 pm

GEUltraFan9XGTF wrote:
I completely agree that if Boeing wanted to take a "military style" approach to NMA if they want to: develop in secret, leak little details, and then roll out a few prototypes to much shock and awe. Imagine roll out a few days before Paris and then flying one or two copies to Paris to much fanfare. Completely possible. And perhaps necessary. Something Leahy would also totally respect.

I'm going to stick my neck out and say that this will never happen. Happy to be proven wrong.

Revelation · Sun Feb 03, 2019 7:15 pm

PlanesNTrains wrote:
GEUltraFan9XGTF wrote:
I completely agree that if Boeing wanted to take a "military style" approach to NMA if they want to: develop in secret, leak little details, and then roll out a few prototypes to much shock and awe. Imagine roll out a few days before Paris and then flying one or two copies to Paris to much fanfare. Completely possible. And perhaps necessary. Something Leahy would also totally respect.

I'm going to stick my neck out and say that this will never happen. Happy to be proven wrong.

I don't think it's even possible given the current BCA set up. They were able to produce the P-8 Poseidon at BCA in Renton on its own line but I think the sensitive bits were installed by BDS at KBFI. Basically most of BCA does not work with the kind of security procedures needed for this kind of thing. I highly doubt the necessary equipment could be purchased and the product could be built to the point of roll out, never mind first flight. KPAE is a public airport and there's not much Boeing can do to prevent members of the public from taking pictures.

On the other hand, I think there is a tiny but non-zero possibility that NMA itself is a disinformation campaign being used to hide NSA development. Tiny, but non-zero till proven otherwise.

justloveplanes · Sun Feb 03, 2019 7:59 pm

Revelation wrote:
PlanesNTrains wrote:
GEUltraFan9XGTF wrote:
I completely agree that if Boeing wanted to take a "military style" approach to NMA if they want to: develop in secret, leak little details, and then roll out a few prototypes to much shock and awe. Imagine roll out a few days before Paris and then flying one or two copies to Paris to much fanfare. Completely possible. And perhaps necessary. Something Leahy would also totally respect.

I'm going to stick my neck out and say that this will never happen. Happy to be proven wrong.

I don't think it's even possible given the current BCA set up. They were able to produce the P-8 Poseidon at BCA in Renton on its own line but I think the sensitive bits were installed by BDS at KBFI. Basically most of BCA does not work with the kind of security procedures needed for this kind of thing. I highly doubt the necessary equipment could be purchased and the product could be built to the point of roll out, never mind first flight. KPAE is a public airport and there's not much Boeing can do to prevent members of the public from taking pictures.

On the other hand, I think there is a tiny but non-zero possibility that NMA itself is a disinformation campaign being used to hide NSA development. Tiny, but non-zero till proven otherwise.

Possible yes. However, you can hide a DoD program, you're dealing with one customer. Dozens of public companies that you need to validate your product against is another story.

keesje · Sun Feb 03, 2019 8:09 pm

PlanesNTrains wrote:
GEUltraFan9XGTF wrote:
I completely agree that if Boeing wanted to take a "military style" approach to NMA if they want to: develop in secret, leak little details, and then roll out a few prototypes to much shock and awe. Imagine roll out a few days before Paris and then flying one or two copies to Paris to much fanfare. Completely possible. And perhaps necessary. Something Leahy would also totally respect.

I'm going to stick my neck out and say that this will never happen. Happy to be proven wrong.

Some minor components would also be developped, build, tested certified in total secrecy. Such as the avionics suits, engines, landing gears, APU. Awesome.

Planeflyer · Sun Feb 03, 2019 8:30 pm

GEUltraFan9XGTF wrote:
I completely agree that Boeing could take a "military style" approach to NMA if they want to: develop in secret, leak few / misleading details, and then roll out a few prototypes to much shock and awe. Imagine roll out a few days before Paris and then flying one or two copies to Paris to much fanfare? Completely possible. And perhaps necessary. Something Leahy would also totally respect.

Don’t See this as bca, bds and global services all stand on their own. After BA breaks out revenues, profits and margins for each.

As an investor this gives me great visibility and Boeing is becoming more investor friendly w each passing year.

NMA will only happen if BA determines it can earn a operating margin at least in the low teens and sell more than a 1000 frames.

PW100 · Sun Feb 03, 2019 10:47 pm

Revelation wrote:
On the other hand, I think there is a tiny but non-zero possibility that NMA itself is a disinformation campaign being used to hide NSA development. Tiny, but non-zero till proven otherwise.

Sort of Sonic Cruiser hiding 787 . . . ?

Planeflyer · Sun Feb 03, 2019 11:13 pm

PW100 wrote:
Revelation wrote:
On the other hand, I think there is a tiny but non-zero possibility that NMA itself is a disinformation campaign being used to hide NSA development. Tiny, but non-zero till proven otherwise.

Sort of Sonic Cruiser hiding 787 . . . ?

Highly doubt the disinformation angle. BA being publicly traded just does not work w blatant untrue statements.

JayinKitsap · Sun Feb 03, 2019 11:43 pm

Revelation wrote:
morrisond wrote:
Yes - impossible to know split between Commercial and Defense R&D spending of $4.1B for 2019

Planeflyer wrote:
The digital design initiatives underway enable robust design and follow on services.

I think we can put it together by researching the T-X.

AvWeek ( http://aviationweek.com/defense/boeing- ... me-changer ; free registration required ) says:

While proving a resurgence in its ability to capture new programs, Boeing’s win of the U.S. Air Force’s T-X trainer also may mark a turning point for the business model at the company’s defense division.

Much as commercial aero engine companies moved years ago toward selling their powerplants below cost to secure marketshare, with the intent of making money later on aftermarket services, Boeing Defense may be headed in the same direction.

Basically, for T-X the push was to spend the time up front (even building and flying two prototypes) to convince themselves they could offer lower prices up front to gain access to aftermarket profits later. I think much of the large amount of R&D spending went in to the (virtual and physical) tools needed to produce these prototypes and validate the results, along with the work needed with the supply chain to make sure the pricing was sound.

Now I'm not saying that BDS and BCA will follow the same business models since their markets work differently, but I am saying they are both strongly motivated to find new business models that capture more of the product's lifetime revenue.

They are working from a position of strength:

Boeing, however, is far more diversified: its commercial aircraft backlog stood at $433 billion at the start of the year, while Boeing Defense was sitting on $50 billion in work, according to the last annual regulatory filing. In addition, the corporation has set a target for the year-old Boeing Global Services division to reach $50 billion in annual revenue by the early 2020s, and it is already around $15 billion.

This article is six months old, whereas https://www.aviationtoday.com/2019/01/3 ... 8-revenue/ says:

Boeing's fledgling Global Services division saw 17 percent YOY growth, from $14.6 billion to $17 billion, bolstered by a fourth quarter in which the acquisition of parts distributor KLX helped the segment achieve revenue increases of 29 percent YOY.

Seems they are ahead of target.

The first article says:

Boeing executives spotlighted the company’s turn toward services in July. “This is a bigger market in the long term than the aircraft market,” Boeing’s chief commercial aircraft salesman, Randy Tinseth, said during the Farnborough Airshow. “We only have 7% [services] market share, so what a great opportunity as we grow to expand our share.”

So everyone involved knows where things are heading.

It doesn't look good for vendors:

Part and parcel to achieving those margins has been Boeing’s supply chain squeeze, the Partnership for Success program, and it came into play with T-X. A year ago, Boeing chose Triumph Group as a key supplier for Boeing’s bid. That selection came as Boeing was finalizing a master contract arrangement with Triumph, as has been done with several other Tier 1 and 2 providers. Triumph is in the midst of a restructuring and streamlining in part to profit after meeting Boeing’s terms.

The squeeze was on for T-X, as it almost certainly is for NMA.

It is largely enabled by using new technology in the production/manufacturing space:

The degree of cost-cutting implied by Boeing’s bid for T-X also may hit at other technology breakthroughs. In 2015, Aviation Week & Space Technology reported on the “Black Diamond” project within Boeing, which sought to transform its defense production system with low-cost manufacturing techniques.

“Naturally, Black Diamond played a role,” Merluzeau says. “The per-unit price demonstrates near-‘Scaled Composites-like’ costs.”

Hopefully the business case will close and we'll learn more about what role all of these things play in the NMA program.

The T-X may be the training exercise for the digital tools Boeing are/will be using for the 797. Train 500 on a small plane getting into the detailed design where there is some chance to shift directions as the design evolves. A year spent on that would be excellent training to be ready for detailed design on the 797.

Authority to Offer would be needed on the 797 to get the selected engine into real development. I suspect a single source, with Boeing taking engine risk as a partner in exchange for aftermarket revenue. That would also be a way to make the engine exclusive - on only the 797 as the only engine there. It pairs up with the Boeing - Safran APU JV.

Newbiepilot · Sun Feb 03, 2019 11:49 pm

Planeflyer wrote:
PW100 wrote:
Revelation wrote:
On the other hand, I think there is a tiny but non-zero possibility that NMA itself is a disinformation campaign being used to hide NSA development. Tiny, but non-zero till proven otherwise.

Sort of Sonic Cruiser hiding 787 . . . ?

Highly doubt the disinformation angle. BA being publicly traded just does not work w blatant untrue statements.

Very true. The CEO can’t mislead investors on an earnings call.

TTailedTiger · Mon Feb 04, 2019 12:49 am

GEUltraFan9XGTF wrote:
I completely agree that Boeing could take a "military style" approach to NMA if they want to: develop in secret, leak few / misleading details, and then roll out a few prototypes to much shock and awe. Imagine roll out a few days before Paris and then flying one or two copies to Paris to much fanfare? Completely possible. And perhaps necessary. Something Leahy would also totally respect.

That would be a lot of fun to watch. But AFAIK Airbus has never been a good sport to Boeing. Contrast that to Boeing who has given well wishes when Airbus finishes a jet. They gave a nice message of congratulations when the A380 entered service.

Revelation · Mon Feb 04, 2019 1:26 am

Newbiepilot wrote:
Planeflyer wrote:
PW100 wrote:
Sort of Sonic Cruiser hiding 787 . . . ?

Highly doubt the disinformation angle. BA being publicly traded just does not work w blatant untrue statements.

Very true. The CEO can’t mislead investors on an earnings call.

Again, I said tiny but non zero odds, and given this disclaimer, I could see something akin to Sonic Cruiser hiding 787. Start out with the MOM target knowing it would be never be a slam dunk just like high-mach airliners, use it to marshal all the best tech, tools, etc and get it going in one direction, only to change direction definitively but not radically late on in the game. The number of people in on it could be as small as 1. Ultimately it is the CEO who will decide to present this to the board or not, and just like SC, there's no guarantee it will ever get there. I know people think this is a crackpot theory, but personally it would not surprise me one bit. I've seen some very difficult to explain things happen over three decades of corporate life.

RJMAZ · Mon Feb 04, 2019 3:27 am

GEUltraFan9XGTF wrote:
I completely agree that Boeing could take a "military style" approach to NMA if they want to: develop in secret, leak few / misleading details, and then roll out a few prototypes to much shock and awe. Imagine roll out a few days before Paris and then flying one or two copies to Paris to much fanfare? Completely possible. And perhaps necessary. Something Leahy would also totally respect.

As far as I'm aware Boeing isn't set up to build secret aircraft at their commercial sites so it would definitely get leaked.

But they could definitely keep it secret with no public launch right up to the point of assembly of the first aircraft. So a 2021 public launch, 2022 first flight and 2025 EIS is possible.

However Boeing would no doubt lease plenty of space at military sites. In theory they could have low rate production for civilian aircraft based at a military site. The main production line at a civil location can start assembly of its first aircraft after the public display of the secret built aircraft.

Personally I think the public launch will simply be 5 years before EIS rather than the normal 7 years. All this means is 2 years of additional development work has been done before public launch.

Planeflyer · Mon Feb 04, 2019 3:38 am

JayinKitsap wrote:
Revelation wrote:
morrisond wrote:
Yes - impossible to know split between Commercial and Defense R&D spending of $4.1B for 2019

Planeflyer wrote:
The digital design initiatives underway enable robust design and follow on services.

I think we can put it together by researching the T-X.

AvWeek ( http://aviationweek.com/defense/boeing- ... me-changer ; free registration required ) says:

While proving a resurgence in its ability to capture new programs, Boeing’s win of the U.S. Air Force’s T-X trainer also may mark a turning point for the business model at the company’s defense division.

Much as commercial aero engine companies moved years ago toward selling their powerplants below cost to secure marketshare, with the intent of making money later on aftermarket services, Boeing Defense may be headed in the same direction.

Basically, for T-X the push was to spend the time up front (even building and flying two prototypes) to convince themselves they could offer lower prices up front to gain access to aftermarket profits later. I think much of the large amount of R&D spending went in to the (virtual and physical) tools needed to produce these prototypes and validate the results, along with the work needed with the supply chain to make sure the pricing was sound.

Now I'm not saying that BDS and BCA will follow the same business models since their markets work differently, but I am saying they are both strongly motivated to find new business models that capture more of the product's lifetime revenue.

They are working from a position of strength:

Boeing, however, is far more diversified: its commercial aircraft backlog stood at $433 billion at the start of the year, while Boeing Defense was sitting on $50 billion in work, according to the last annual regulatory filing. In addition, the corporation has set a target for the year-old Boeing Global Services division to reach $50 billion in annual revenue by the early 2020s, and it is already around $15 billion.

This article is six months old, whereas https://www.aviationtoday.com/2019/01/3 ... 8-revenue/ says:

Boeing's fledgling Global Services division saw 17 percent YOY growth, from $14.6 billion to $17 billion, bolstered by a fourth quarter in which the acquisition of parts distributor KLX helped the segment achieve revenue increases of 29 percent YOY.

Seems they are ahead of target.

The first article says:

Boeing executives spotlighted the company’s turn toward services in July. “This is a bigger market in the long term than the aircraft market,” Boeing’s chief commercial aircraft salesman, Randy Tinseth, said during the Farnborough Airshow. “We only have 7% [services] market share, so what a great opportunity as we grow to expand our share.”

So everyone involved knows where things are heading.

It doesn't look good for vendors:

Part and parcel to achieving those margins has been Boeing’s supply chain squeeze, the Partnership for Success program, and it came into play with T-X. A year ago, Boeing chose Triumph Group as a key supplier for Boeing’s bid. That selection came as Boeing was finalizing a master contract arrangement with Triumph, as has been done with several other Tier 1 and 2 providers. Triumph is in the midst of a restructuring and streamlining in part to profit after meeting Boeing’s terms.

The squeeze was on for T-X, as it almost certainly is for NMA.

It is largely enabled by using new technology in the production/manufacturing space:

The degree of cost-cutting implied by Boeing’s bid for T-X also may hit at other technology breakthroughs. In 2015, Aviation Week & Space Technology reported on the “Black Diamond” project within Boeing, which sought to transform its defense production system with low-cost manufacturing techniques.

“Naturally, Black Diamond played a role,” Merluzeau says. “The per-unit price demonstrates near-‘Scaled Composites-like’ costs.”

Hopefully the business case will close and we'll learn more about what role all of these things play in the NMA program.

The T-X may be the training exercise for the digital tools Boeing are/will be using for the 797. Train 500 on a small plane getting into the detailed design where there is some chance to shift directions as the design evolves. A year spent on that would be excellent training to be ready for detailed design on the 797.

Authority to Offer would be needed on the 797 to get the selected engine into real development. I suspect a single source, with Boeing taking engine risk as a partner in exchange for aftermarket revenue. That would also be a way to make the engine exclusive - on only the 797 as the only engine there. It pairs up with the Boeing - Safran APU JV.

Not sure on the engine angle but fully agree on the tx practice run.

Digital design tools combined w what BA learned on the 787 will pay forward on upcoming programs.

seahawk · Mon Feb 04, 2019 6:24 am

A engine RFP does not mean you could not have been working with one OEM already.

keesje · Mon Feb 04, 2019 9:18 am

TTailedTiger wrote:
That would be a lot of fun to watch. But AFAIK Airbus has never been a good sport to Boeing. Contrast that to Boeing who has given well wishes when Airbus finishes a jet. They gave a nice message of congratulations when the A380 entered service.

Never let the truth get in the way of a good story.. https://www.google.com/search?q=%22Airbus+congratualtes+Boeing%22&rlz=1C1GCEA_enNL772NL772&oq=%22Airbus+congratualtes+Boeing%22&aqs=chrome..69i57j0.11198j0j7&sourceid=chrome&ie=UTF-8

I think we should also take into consideration the (slight) chance Boeing has not been developing a great 797 in secrecy. And maybe Airbus has not shelved everything, waiting for Boeing to formulate a responds. Stranger things have happened.

Boeing has moved the possible launch into 2020, maybe Airbus is still aiming at a 2019 launch. If Boeing is to be believed, and there is a market requirement for 4000-5000 aircraft in this segment over the next 20 years, that might be a good reason for their competitor to simply move ahead anyhow.

https://groups.google.com/group/aviation_innovation/attach/16bb07e6671fcb/Airbus%20A322%20NEO%20Fake%20keesje%20NMA%201.jpg?part=0.1&view=1&authuser=0

Reuters:
https://www.reuters.com/article/us-airbus-a321/airbus-tests-market-for-a321xlr-jet-launch-by-mid-2019-sources-idUSKCN1OJ14X

morrisond · Mon Feb 04, 2019 2:32 pm

seahawk wrote:
A engine RFP does not mean you could not have been working with one OEM already.

True - but as many have speculated - if NMA is 2025 the engines will be a derivative of existing technology - basically a sized up PW1100 or Leap with PIP's - or a downsize of one of the widebody engines - they won't need time to develop next gen technology. They should be able to accomplish that in the time frame.

They did the Trent 7000 in 4 years from selection in July 2014 to certification in July 2018 - albeit 1 year behind schedule - originally it was supposed to be only three years.

I would have to guess that they would need a custom core for NMA but if they stuck to existing tech and engine architecture - with possible more use of CMC's - if they did choose the engine supplier this year 2025 should be doable.

Boeing would need to know the engine specs (thrust/weight/price) and who the supplier was as part of the ATO discussions with airlines. They aren't going to get any commitments without that info.

Once they have chosen the Engine(s) at ATO (which could happen quite soon) there is nothing to stop the Engine Supplier from starting to work on it. As Boeing is speculated as a risk sharing partner there is nothing to stop from them putting up capital at ATO to get work started - taking the capital risk away or reducing it for the engine supplier if NMA doesn't go ahead.

Basically if ATO is this spring - work on the engine(s) will most likely start as well.

ikolkyo · Mon Feb 04, 2019 2:36 pm

morrisond wrote:
seahawk wrote:
A engine RFP does not mean you could not have been working with one OEM already.

True - but as many have speculated - if NMA is 2025 the engines will be a derivative of existing technology - basically a sized up PW1100 or Leap with PIP's - or a downsize of one of the widebody engines - they won't need time to develop next gen technology. They should be able to accomplish that in the time frame.

They did the Trent 7000 in 4 years from selection in July 2014 to certification in July 2018 - albeit 1 year behind schedule - originally it was supposed to be only three years.

I would have to guess that they would need a custom core for NMA but if they stuck to existing tech and engine architecture - with possible more use of CMC's - if they did choose the engine supplier this year 2025 should be doable.

Boeing would need to know the engine specs (thrust/weight/price) and who the supplier was as part of the ATO discussions with airlines. They aren't going to get any commitments without that info.

Once they have chosen the Engine(s) at ATO (which could happen quite soon) there is nothing to stop the Engine Supplier from starting to work on it. As Boeing is speculated as a risk sharing partner there is nothing to stop from them putting up capital at ATO to get work started - taking the capital risk away or reducing it for the engine supplier if NMA doesn't go ahead.

Basically if ATO is this spring - work on the engine(s) will most likely start as well.

Del

Aircellist · Mon Feb 04, 2019 4:43 pm

If the delay really is about building a business case, it begs the question of said business case… Once, a few dozen sales were enough, then a few hundreds. Nowadays, are we already past one thousand sales needed prior to formal launch?

Revelation · Mon Feb 04, 2019 5:34 pm

Aircellist wrote:
If the delay really is about building a business case, it begs the question of said business case… Once, a few dozen sales were enough, then a few hundreds. Nowadays, are we already past one thousand sales needed prior to formal launch?

That's how you would think about it, if you're thinking in terms of industry norms. However, if you're trying to change industry norms and take more of the lifecycle spend for yourself, it might take longer periods of arm twisting and/or bypassing to get a business case to close.

frmrCapCadet · Mon Feb 04, 2019 5:57 pm

As an amateur I designed and built a house. Design took two years and a lot of pencils. Cheapest remodels that ever could be done. At that point I turned final designs over to a professional, she made some really great changes. Things worked as I intended.

Given the capabilities of modern computers and 3D printers, and other manufacturing techniques Boeing could well the designing, building actual or computer models of certain systems and parts, and then redesigning from scratch some parts and systems of this new plane. Insights from material science are likely playing a new and major role. Advances in all of these areas since launch of 787/350 are spectacular. Boeing (and Airbus when they determine it is time) intends to get it right, and the first time.

jeffrey0032j · Mon Feb 04, 2019 6:09 pm

Aircellist wrote:
If the delay really is about building a business case, it begs the question of said business case… Once, a few dozen sales were enough, then a few hundreds. Nowadays, are we already past one thousand sales needed prior to formal launch?

Business case doesn't just look at the demand for the plane itself, but whether more efficient manufacturing methods or supply chain solutions could drive costs down and this is for the long term, so that has to be done right.

seahawk · Mon Feb 04, 2019 8:15 pm

morrisond wrote:
seahawk wrote:
A engine RFP does not mean you could not have been working with one OEM already.

True - but as many have speculated - if NMA is 2025 the engines will be a derivative of existing technology - basically a sized up PW1100 or Leap with PIP's - or a downsize of one of the widebody engines - they won't need time to develop next gen technology. They should be able to accomplish that in the time frame.

They did the Trent 7000 in 4 years from selection in July 2014 to certification in July 2018 - albeit 1 year behind schedule - originally it was supposed to be only three years.

I would have to guess that they would need a custom core for NMA but if they stuck to existing tech and engine architecture - with possible more use of CMC's - if they did choose the engine supplier this year 2025 should be doable.

Boeing would need to know the engine specs (thrust/weight/price) and who the supplier was as part of the ATO discussions with airlines. They aren't going to get any commitments without that info.

Once they have chosen the Engine(s) at ATO (which could happen quite soon) there is nothing to stop the Engine Supplier from starting to work on it. As Boeing is speculated as a risk sharing partner there is nothing to stop from them putting up capital at ATO to get work started - taking the capital risk away or reducing it for the engine supplier if NMA doesn't go ahead.

Basically if ATO is this spring - work on the engine(s) will most likely start as well.

If we calculate with 1 year of flight testing, the engine needs to be ready by 2024, which means the engine test must start 2023, which leaves them about 3,5 years to design the engine, set up the supply chain and the manufacturing. Considering the teething problems of modern engines, it is a challenging job and very risky if you agree on guarantees and compensation payments for engine based delays.

Imho it only is reasonable if there is only one engine option and if the engine overhaul business is certain to give you future income - which probably means locking out other MROs. Which then again might be not so good for the business case.

morrisond · Mon Feb 04, 2019 8:27 pm

seahawk wrote:
morrisond wrote:
seahawk wrote:
A engine RFP does not mean you could not have been working with one OEM already.

True - but as many have speculated - if NMA is 2025 the engines will be a derivative of existing technology - basically a sized up PW1100 or Leap with PIP's - or a downsize of one of the widebody engines - they won't need time to develop next gen technology. They should be able to accomplish that in the time frame.

They did the Trent 7000 in 4 years from selection in July 2014 to certification in July 2018 - albeit 1 year behind schedule - originally it was supposed to be only three years.

I would have to guess that they would need a custom core for NMA but if they stuck to existing tech and engine architecture - with possible more use of CMC's - if they did choose the engine supplier this year 2025 should be doable.

Boeing would need to know the engine specs (thrust/weight/price) and who the supplier was as part of the ATO discussions with airlines. They aren't going to get any commitments without that info.

Once they have chosen the Engine(s) at ATO (which could happen quite soon) there is nothing to stop the Engine Supplier from starting to work on it. As Boeing is speculated as a risk sharing partner there is nothing to stop from them putting up capital at ATO to get work started - taking the capital risk away or reducing it for the engine supplier if NMA doesn't go ahead.

Basically if ATO is this spring - work on the engine(s) will most likely start as well.

If we calculate with 1 year of flight testing, the engine needs to be ready by 2024, which means the engine test must start 2023, which leaves them about 3,5 years to design the engine, set up the supply chain and the manufacturing. Considering the teething problems of modern engines, it is a challenging job and very risky if you agree on guarantees and compensation payments for engine based delays.

Imho it only is reasonable if there is only one engine option and if the engine overhaul business is certain to give you future income - which probably means locking out other MROs. Which then again might be not so good for the business case.

Assuming Boeing wants to get involved in the engine - I highly doubt there will be more than 1 anyways. They don't have to lock-out the overhaul business - even if other shops do the work they will still get some of the parts revenue.

Who is online

Popular Searches On Airliners.net