The Culture of Demand Chapter 4. Orders and Deliveries, The Tip Of The Iceberg.

 

We are talking about airplanes here and not cruise ships hitting Icebergs.  However, it’s so important to be World’s Biggest at something. May as well be at airplane making and Boeing remains the World’s Biggest deliverer of airplanes. Which is good only if enough backlog exists for that YOY status report. Airbus once was World’s Biggest until Boeing built more production and infused the 787 line found in two cities while taking a page out of the Airbus play book.

So Orders do eventually matter over time and Airbus has so many it can’t build airplanes fast enough or can it deliver to not so happy customers in waiting. Boeing says production is the key to its nirvana in Seattle. Airbus says we have more orders than Boeing every day somebody is listening. I hope no one wants an airplane soon from Airbus. This chapter could go on forever as Airbus is building about 90 WB‘s a year and Boeing is building about 175 WB’s a year when including 767, 787,777 and 747 types. Airbus has its A330, A350 and A380 lines churning as fast as it can.

The most important note, if taking notes is that a delivery = CASH! Orders equals bragging rights. Boeing beats Airbus with its cash account and Airbus just brags a lot even after Airbus John Leahy retires. 

The main thing for Airbus is that if it can’t deliver in a timely manner it will lose orders and customers. Those are called cancellations. This is a big Airbus metric to watch.

Boeing is a producer and that makes airline customers happy. A customer can get a timely delivery from Boeing and a customer can delay a delivery when it wants to as Boeing has a fairly stable backlog (unfilled orders). The definition of backlog is unfilled orders from customers who happen to have ordered. Airbus has an immense single aisle backlog greater than Boeing’s single aisle backlog. Airbus needs to build single aisle with more production, and it must keep suppliers happy too by not overburdening the parts supplier into oblivion. 

Airbus tried a new tack, duo engine offering for its A320. All went well when one engine maker stumbled. The P&W gear driven jet engine has teething woes much like what the 787 went through when exposing its own all new technology after the first 787 delivery. The P&W engine is often parked on a factory bench for further inspection and repair.

Airbus is having supply chain issues and engine issues when it should be delivering 70 single aisle A320’s a month. Instead, it is shooting for 60 A320’s a month. It only delivers about 5-7 A350’s a month. Boeing delivers about 12, 787 a month. It also delivers copious amounts of 777-ERs which is a very big dual aisle aircraft. In fact it is running out of 777’s work orders as a diminishing 777-300ER backlog is a backdrop to the 777X program. Boeing should be fine if it executes the 777X program well after the 777X first delivery.

The main thing both manufacturers face, are the business Icebergs creeping up on its supply chains, engine makers, and fickle customers. If either airplane maker strikes one of those Icebergs it will be hard to deliver its customer a value, I only mean the commercial airline (customer). The commercial carrier so desperately needs to deliver value to its own customers, you them as passengers and so forth…

The Culture of Demand Chapter 3. The Passenger Demands Value

 

The first two chapters have reported the juggling evolution of making profits from the manufacturer to the Airline. The goal is profit and not the customer. The caveat is pricing convinces passengers to buy an airfare over any other considerations for the limitations inherently offered by airlines. The incentive of riding in so many cubic feet becomes a passenger acceptance for any ticket purchased for a flight anywhere. 

I did say I would mention the South West Airlines and its "Cattle Call" in this chapter. I got to the ticket desk first and bought seat 6A which allows me to line -up with customers from row 1-10. I received a Blue boarding pass, cool, huh? Next came the announcement for those with a Blue boarding pass may now load to your respective seats. Civility ended on the word "respective". The cattle stampede to board was on. The dust settled when the yellow boarding pass announcement was blared over the terminal to those passengers with carry-on lunch bags.

Airlines are rapidly eliminating First class into Business class “suites”. An airline suite is defined as any space with direct aisle access, privacy screens and lie flat features. It would include seating space greater than 20” wide and a seat recline feature. Economy or premium economy would not feature most of these minimum standards.

The passenger has been conditioned into some substandard airline world and accepts it because of price. People want to fly, but can’t afford airplane space of the business class. Airlines realize this and offer a sweetener called Premium Economy showing promise to the passenger of something that once was but has gone the way of bell bottom jeans.

The passenger demands value and the airline reply becomes “and your point is?" In fact passengers are dumb-down into thinking premium economy class escapes the torture of cramping. It could be a worse sentiment, warning passengers having an economy seat. 

The economy seat incentive is the predictable $99 ticket economy ticket. It could be worse, premium economy cost $199. The old Wendy’s commercial proclaimed “where is the beef”. The latest airline commercial can’t even muster a “Where is the value” shout out from its Ad execs. Boarding airplanes become a ritual worthy of praise by Lemmings in Alaska. A lemming simply turns right and jumps into a sea of passengers. 

The value is found in deep vein thrombosis when departing from economy to the hospital, affordable care act kicks in. If an airline offers real value then will the manufacturer have to respond in-kind. The manufacturer is chasing metrics. The airplane can fly farther on less fuel than the other guy. It is quieter and more efficient getting there and that’s where the real value is located.  The passengers just don’t get it that value is in the air frame. The airline doesn’t get it that value is in its seats bolted down. The manufacturer doesn’t get it that value is in the folding wing and so forth.

Value for the travel culture has become the biggest lost art since outhouses were torn down in back yards everywhere. The culture emerges from metrics called pitch, width and Wi-Fi channels. Pitch is that erogenous zone from your knee cap to the small of your back. People brag about the pitch when talking to friends they are visiting with in Europe. Passenger culture speaks, “I only fly with a 34” pitch- 30” inch pitch is for losers, do you agree?” The next passenger had Wi-Fi and gets the terminal waiting area’s attention, “I’ve got 2,459 movies and a google movie pass to boot.” Even those standing in line at the Ryan Air Kiosk turned and looked at the braggart’s Wi-Fi proclamation.

The final straw was the guy who had a 54” waist line smugly pushing his way to economy plus seat at 18.5 inches wide saying, “ It sucks to be in economy at only 17” wide and no back of seat map pockets.” The passenger has been dumb-down by cheap tickets, no first class and having an Economy Plus seat as its reward for a traveling culture made via the travel brochure advertisement.

The true value comes when there is no economy plus segregation as all seats past row twelve are a standard Economy Plus specification. There is no first class since that type of class term is so Victorian. Instead the appropriate value term would be “Stateroom Cabin” good for both business and pleasure travelers looking for value for the buck.   Take it from cruise ship travel companies, steerage is where Titanic movie extras slept. 

The Culture Of Demand Chapter 2. The Airplane Industry Demands Change

The real divide is between the maker’s customers and the customer’s customers called passengers. The manufacturer works for the commercial carriers’ bottom line while enhancing its own bottom line. The carrot dangled is the passenger low price ticket. The passenger's demand, centers on low fares because the economy of scale throughout the world has skewed values.  The airline responds with the beef hook idea for hanging the price over a customers sensibilities. The culture has changed and passengers may grumble but what choice do they have, an Emirates $4,000 dollar one way fare?

Ryan Air, Winging It’s favorite example out of Ireland, has shrunk the galley, squeezed in more seats rows, and ordered a new single aisle type named the 737-200C. The “C” stands for cord-wood stacked in its airplane with room for two hundred stacks of wood on board. The Ryan Air game is to offer a convenient kiosk experience unlike its competitors. Pick your food and pick your pleasure from a buffet of offerings within its operation, thus adding value to the Ryan Air revenue flight each time it flies. The main thing is the airplane “crack” that passengers crave, which is a cheap ticket for its travel. Ryan Air has set a time standard for its routes. That is to say, how long can they keep humans pleased with cheap tickets while offering pay-as-you-go options for its travel preoccupations?  They are exploring that notion today, as it plays with the new ticket price culture.

The culture has changed indeed and low fares lead the charge while amenities appear and disappear as much as your credit line can stand the kiosk assault. It’s not the airlines' problem, it gave you a cheap ticket and your eyes could only fixate on the price. Airline “crack” will sell your children down the jet way in short order by a multitude of travel ticket rules. The Twelve year old can get on for half fare, while the 13 year does not get to see the Pirates of The Caribbean, Orlando adventure ride and stays at summer boarding school for a price ten times higher than a full price Airfare. 

In fact if your very young child poops its pants real trouble begins as surrounding customers begin an airline chant, “Remove That Child”, I paid good money for my low fare”.

The lawyers get involved as they read the tickets fine print, it says here, “pooping is only allowed in the rear toilet area any infraction of this rule could cause an airline disruption and immediate removal of family or offender. Passengers may receive shock sticks to the neck if non respondent”.

Don’t forget that your eyes were fixated on the word “Economy” and the purchasing passenger lost its nervous control over that word and bought the ticket(s) on the “737-200C” to New York from Ireland. It’s a cultural thing you know? The next Chapter gets off Ryan Air's back and mentions South West Airlines and its cattle call to the meat hooks.

That question arises, Is Boeing responsible, the airline or the passenger in this culture shift? That is the very nature of the up-coming chapters. Whose fault is it? I mean the electrical probe to the neck of a screaming economy passenger. All they did was buy an airlines’ low fare on a single aisle aircraft made by a manufacturer meeting the current industry demand. So they culture had to change from “Build it and they will come” to: "build it wonderfully" which is old school and a myth. 

So the manufacturer stuffed everything invented to the airplanes frame as a modern marvel but forgot the “bottom line” of the passenger. They traded that position away at an online web site starting with “cheap fare”. The passenger bottom is no longer protected.

The commercial airline test lab is experimenting with how much room does a person need for breathing from the tip of the nose to the partition in front of it on a 10 hour fight?

The second airline test is how to keep meat hooks holding the vertical freight from swinging thus causing airsickness for its passengers (freight)?

The third lab test will reveal what advertising is needed convincing people this is the way of travel from a cultural perspective?

Boeing is stuck with the culture shift to low fares and how to build an airplane carrying so much weight, it not its problem how a customer will fill it, nor is it a passenger problem because they bought a low fare ticket. The airline crack now controls the buying public with low fares.

The Airline Industry Demands Change in this inverted structure when once competition was the key to success. The competitive nature built the best pleasing the passenger. Now it builds what is best for the Manufacturer and Airline “Bottom Line”.

The Culture Of Demand Chapter 1. The Airplane Industry Has Changed

"The Culture Of Demand", sounds like a book title but its what happening to the aviation industry. The “that’s the way we’ve always done it” is rapidly shifting to just-in-time fleet changing. The airplane culture had the Jumbo Jets spanning the globe during the 70’s through 2010 for forty years without a pause. The airplane culture said going from Australia to Los Angeles is a job for the 747. It also said going Euro via New York required a 757. The airline culture was set on its own status quot.

However, there is a change coming signaled by the President Of The US own proclamation, “The 747 is way too expensive”, until two mothballed 747-8’s were found in California for Presidential purchase. 

Trans Aero did not take delivery of its two 747’s ordered and the Air Force found two brand new ones sitting in California with Boeing. The culture was shifting from the 747.

Then there was the 787 saga of medium wide-body flying the world. 

A 737 NG could only carry 187 passengers going ocean hopping and 240 passengers or more with twin engine 787's.

The airplane culture said no more four (engines). Twins are the apropos style today as a 409 passenger twin is proposed from the 777-9X type. The airplane culture may yet demand a 777-10X twin going 450 seats, thus eliminating any four engine A380 ticket holders. The Pan Am clipper was a dying breed never to be seen again as it landed in New York Harbor from the 1930's.

It Had four engines too!

It also had lie flat seating as well with its "Compartments"

The age of Art Deco passed when WWII came and went. However, the culture keeps churning forward and its demand walks hand in hand as each aviation option plays out. 

Currently, the aviation prognosticators see a different day coming, but it waits for the aviation culture to catch-up on that day. The market must figure out how the "new airplanes" will fit in and offer public options of travel before the culture can settle in with the Jumbo twin engines and super efficient single aisle aircraft. 

The problem comes from the airline top of the organizational tree. They talk of 30" pitch as some kind of standard. Next comes the executive clowns who figure out how to stand passengers up like beef on a hook at a slaughter house. The execs may even suggest its the best way to travel "you'll love it", in an attempt at changing the airline culture into becoming a side of passenger beef.

Somewhere along the marketing supply and demand class an instructor read a book called the "Field of Dreams". "Build it and they will come", was a multiple choice answer. The MBA now working for an airline said, he/she learned it at school during the board of director's presentation class. Mutual clapping was heard from down the hall by those living in cubes. The Administrative assistant heard back slapping from behind the closed door meeting room.

New airplanes are built for the bottom line and not the passenger's bottom. They have departed from the classic mission of building it wonderfully and success will be the results. The new mission is no longer a passenger centered concept but a freight centered operation. The people buying tickets are too fat and they won't cooperate with freight packaging constraints. If Boeing could build a single aisle that could fly cord wood 5,000 miles they would. The airlines haven't figure out how to convince its customers that cord wood seating is a good thing. They are now exploring a way to charge extra for a personally sized meat hook. 

Yes, the culture is not coming from demand but is coming from profit makers. It has become a culture of profit. Long live the "Clipper".

Boeing's Flying X-32 Pig

Boeing military needs a “Game Changer”. Whether it’s a fighter jet, a drone or autonomous war bird, it needs to make a statement war fighter. Its last chance was the F-35 contest which it lost to Lockheed in an ugly fashion that only a US Marine could have loved. Was Boeing just seeking a participation award from the DoD with its rendering of its flying pig?

How in the heck could that make a radar profile the size of a fishing boat like the 700 ft.USS Zumwalt had accomplished? It's smaller than a fishing boat without fishing nets. That's how! Was Boeing really trying with this offering or was it a rubber option for making Lockheed's F-35 take the award and without the appearance of Boeing taking a fall in the first round of the fight.

So it went Mach 1.6 and the vertical lift system was not perfected during the competitive test. It once was to co-star in a comedy war movie about a hover tank. The hover tank made it past the DoD generals who approved it and the audience laughed. The X-32 didn't make the movie. The cardboard tank did in its place. 

The X-32 would scare the crap out of frozen soldiers in fox holes. It could lay down fire suppression in an impressive fashion. The flying box was so stealthy it fooled a barn door into thinking it was a brick wall. Boeing was proud of its 1960's delta wing style and it did lose to the F-35 on style points. 

The advice given Boeing was to stop having staff meeting for any new idea or it may end up with another X-32. It certainly was a staff meeting concept put together with copious amounts of coffee and donuts. The same team assembled an elephant for the run for the roses at the derby.

The Defense department wanted a Multi-role fighter that could take-off vertical, go Mach 1.6 and be invisible to radar. The the DoD wanting an air frame space large enough to stuff technology into it that would beat any future war scenario. 

Boeing took the DoD seriously and showed them this picture. The DoD met afterwards and gave a sigh of relieve having Boeing's X-32 in the competition. It could ease back and justify it's a competition after-all, and the award would go to Lockheed without question. Boeing would make money also on this deal for taking a powder.

Many a pundit said something is wrong with this picture, it just doesn't look like a fighter nor can it do all mission roles required. It didn't matter since it was not the choice anyways from the start of this Multi-role fighter saga. At the time of the awarding, Lockheed was no longer a competitor, and it did not have to act as the competition. 

In American enterprise it is said, "Competition makes the best product". The Lockheed offering stopped being competitive over 10 years ago. It just had to please the Hover Tank Gang lead by Sargent Bilko at the DoD. The new jet competition is between who can do what to whom for the most amount of money. 

I do believe, by accident, the F-35 will turn out just fine for the best money can buy results, which has become the true American culture. No longer does competition make diamonds because doing it that way only costs time and money, huh?

Where Will Boeing Get Its Next Cash?

This is another big and broad topic. Boeing regularly reports cash inflows and a prop to its stock price going higher. Nothing is forever and Boeing knows this and has some kind of plan for its future cash infusions.

This all starts with will future sales and its completions of sales contracts. This cycle is probable but has some risk in it such as Boeing's recent Transaero order book adjustment which will show up in the July Boeing reports. The blog is about the June reporting numbers of Boeing's backlog by unit and list price. The backlog/price is Boeing's fuel for future performance and stock appreciation.

Below is a snapshot of Boeing's undelivered units and its associated list prices ending June 30th 2017. An addendum WI report for July will show all updates per Boeing web reporting.

What the chart estimates is a cash backlog from undelivered units with a value of $831.5 Billion. This is  a fluid and dynamic number where month to month can change dramatically. The change is often surprising,  as production remains somewhat stable. The backlog cash value can change from the back end as orders are cancelled and recognized by Boeing accounting. The front end is its production stream with its deliveries.

Using the analogy of a fuel tank on a automobile shows the concept best. A full tank of fuel can take the company a long way while pleasing its passengers , the stockholder. Sometimes vehicles has dual or spare fuel tanks. The 737 program is Boeing's main tank and the wide body programs are under a half a tank as a dual tank, which will take the Boeing Corporation only so far into the future.

The 737 program represent 58% of its future cash flow.

Per Type Cash Backlog as a percentage:

• 737 58%
• 747  1%
• 767  2%
• 777  20%
• 787  19%

Total 100% of 832 Billion

As can be derived, the single aisle program (737) is the critical piece to Boeing's aspirations going forward. Boeing hopes to change the balance where the wide body will share a potential cash value with the single aisle program. Using above numbers the 58% single aisle cash backlog of the total 832 billion is compared with the 42% for the wide body contribution of its cash flows.

Contract price is about 50-55% of list price as Boeing offers package deals for its preferred customers who have bought Boeing products over time. Therefore, it is a solid estimate for Boeing's backlog cash amounting to somewhere in the $425-$460 Billion range.

A Boeing goal would be to continue a robust sales campaign for its varied wide body fleet. The per unit price for wide bodies has an immediate impact of its cash backlog. 

The 747 program has died. 

The 767 program is on freight life support. 

The 777 program is caught in the door of transition from 777-300ER going to 777X. The backlog of older 777 has a reduced production flow since it is running out of 777-300-ER's to build and the 777X hasn't been assembled. So the 777 cash potential will increase as a cash reserve, but diminish as a cash flow during the next two years. 

Boeing will have to rely on its 737 program for cash flows during the next two years until the 777X entry into market.

The 787 wide body program is the secret Boeing sauce. The 787-10 is a cow tipping point of cash for Boeing. More orders for this type are coming and more cash from this type will emerge. Its too early to tell what the 787 program will do by year's end, but it may surprise the financial prognosticators by year's end.   Boeing has the same general numbers this blog has obtained from Boeing's own website.

Therefore, its emphasis is to bring a high amount of backlog and a balance with its various commercial programs. The sales campaigns are not for public view and are actively going forward. Boeing is attacking its future while burying its dead along the way. A sad farewell for the 747 is happening while a robust 777X project is emerging as its latest star in the making. A future cash flow is forming in 2017 and 2018. It is shown through a MAX effort for the 787-10 and the 777-9X. The marketing team is keeping pace with its production counterparts.

Sheikh Ahmed Makes Boeing Sweat Bullets With Emirates Order

It has been a long wait for Emirates, Sheikh Ahmed to announce a mega deal for its airline. Background on the Emirates deal making can lend some insight but not a definitive outline who the Sheikh may deal out the wide body order.

Emirates to decide on Boeing or Airbus multibillion dollar order

Some history with Emirates and Airbus exist which makes it an interesting decision path. 

Emirates Cancels Airbus A350 Order

During June 2014, Emirates dropped the shoe on Airbus and canceled its entire 70 A350-900 order. It amounted a $21.6 billion Airbus embarrassment. After all, Emirates was a leading A-380 customer at this time. It has introduced 95 A-380's into its fleet with a remaining 47 Airbus A-380's on order. Emirates has a big Airbus interest muted by the A350 cancellation in 2014. The conclusion is a slight Airbus advantage before considering a waning super jumbo market dying.

Boeing, was a lady left at the order alter throughout Airbus' march into the UAE and has had a lot of time and change management on its hands since the first A-380 delivered. Boeing has since amassed 150 Boeing 777X orders, Thirty-five 777-8X and 115 777-9X. Similarly it has 139 777 classics in its fleet where the retirement for the 777 classics could coincide with its inducting its 777X order book. The 777X orders came after the Emirates A-350 cancellations. The conclusion is a significant Boeing advantage since Emirates is renewing its Boeing wide body fleet with the 777X.

The current order target is for the mid-wide body class. Emirates already passed on 70 A-350's it had locked down. Winging It assumes it was because the 777X was announced earlier and after Emirates' input regarding the design, range and 777X efficiency. 

Emirates wasn't ready for the 70 A350 it had ordered since the 777-300-ER was providing Boeing air cover for Emirates fleet requirements. It had so many A-380's on order, so cancel A-350's they did! The ordering has opened up again as the Emirate's fleet plans have matured to the point it can slot in either the A-350 or the 787 during the next 10 years. However, the A-380 is slowly turning into a Emirates white elephant causing a fleet strategy change, by using the 777X orders in its place as they retire its super Jumbo fleet over time. A note from Emirates to Airbus, "We don't want no stinking A-380 NEO". A second note from Boeing, "we rented space next to you at the Dubai Air Show". November is end of year-ish as the Sheikh could announce a mega order during the year's last quarter and still be spot on when he just announced it will be the end of the year for a wide body announcement. Enough of the announcements in one sentence.

Several have reported the deal is done and Boeing won, which makes sense when looking at fleet numbers and the A-380 descent in the market place. The A-350 is matched by the 787 at several levels. Perhaps Emirates doesn't need a 8,000 mile traveler with high density appointments. It may only need a high density traveler closer to home reaching Europe and the East as far as Perth Australia. A step up would be a 777-8X for "all" the far east destinations. Having a 787-9 order would fill any intercontinental requirements without it having to fill an A-380 with five hundred passengers. Once again the 777-9X 400 seat lay out would replace any half-filled A-380 route. The fleet combination of 787's and 777X's is a more deadly competitor than having a A350 fleet with an ailing A-380 as its stable mate. Emirates is looking for the right mixture for its fleet. Since the launch of the A-380, a lot has changed and Boeing got the memo to change and change they did. Boeing is looking down the barrel of an immense Dubai order this November as the Sheikh has indicated.

Added Value A Boeing Target

Boeing has for a long time avoided making things without wings such as avionics suites or even engines. The later mention of engines is far from a Boeing thought cycle but it has an eye for other stuff that Rockwell Collins and and Honeywell International may supply. A bold step is adding on other things to a portfolio when making high tech things like airplanes. Boeing makes military, space and other X projects too. It isn't hard to imagine them making avionics for example for its own aircraft and for others.

The manufacturer has a think tank exploring all kinds of ways it could add value to its product line. If it could make its own flight controls, or make  engines then Boeing would add value to every aircraft it sells.

It Sounds Like A 787-300 To Me

Quote coming from: 

5 Things Boeing's Management Wants You to Know

".. [W]e see route structures around the world continuing to evolve as general passenger traffic growth is occurring, in particular, new regional structures, point-to-point connectivity. That's in this 4,000 to 5,000 nautical mile range, airplanes that are in the 220 to 270 passenger range. That's the ballpark that we're looking at and discussing with customers."
-- Dennis Muilenberg

Boeing is going big with a NMA offering. The decision to build a NMA tween the 787 and the 737 has caved into other considerations such as:

Plant expansion and space availability.Technological fall forwards from prior programsRange announcement of 4,000-5,000 milesSeat Announcement from 220-270 units.Mature supply sources in place.

Boeing already has the infrastructure to build more 787 and does not have as much 737 site capacity for a NMA. It has a process in place for building all CFRP aircraft from its two sites in Everett, Wa and Charleston, SC. In fact, Charleston has more available acreage for plant expansion than Everett has on its books. In SC Boeing can buy more land where in Everett the land around its manufacturing footprint becomes more expensive and in shorter supply.

Boeing can't use all its hard gained technology in a NMA metal frame concept. The NMA is ripe for everything Dreamed of over the last 15 years and it will go CFRP on wings and body. In addition, the body design will change to an unconventional shape which is  perfect for CRFP shaping. Using older 737 Max building technology limits any future following advancements for a new type.

The former 787-300 range was set at about 3,300 miles. What Boeing has learned it can build a lighter frame going 4,000 to 5,000 miles on new technology engines. Additionally, it can connect 787 technology to a NMA better than connect the 737 Max technology going forward. Weight saving "All electric architecture" may be a selling point on the NMA. A core operating system from the 787 is more inline for a NMA than using a Max type system for a NMA.

The announced seat capacity of 220-270 suggest a dual aisle - 8 across profile. Something like a 2-4-2 would get Boeing to 220-270 passengers in a two class cabin or less. The eight across would alter the 787 hull diameter by a small increment, thus allowing NMA sections to be moved by the Dream Lifter. 

In fact Boeing has access to an abundance of 747's on the used market where it can expand its Dream Lifter Fleet by several without immense costs incurred. Charleston could build the NMA and 787-10 exclusively. Everett on the other hand would build the 787-8 and 787-9 exclusively.

Finally, the supply line would not be disrupted having only a few modifications to its requirements. A hull and wing building source would have to be identified. The engine maker may go to "the winner takes all", when awarding to only one engine maker, like the 737 has used over its years. 

The competition would be fierce among the Builders. GE, CFN, PW and Rolls are the names of the big players. Engine supplier competition is a fortunate problem offering builders a chance at a whole new engine type unlike any other. A locked in exclusive contract is what stock market values are all about. The NMA could sell 2,000 units in the first five years. This may disrupt both the single and dual aisle current stability at this time. Boeing is betting it will hurt Airbus as a whole, more than its Boeing family of aircraft.

The 787 Marches On With July Numbers

Boeing has had a solid July 2017 with its deliveries of 12 787, completing a 90 day run of 36 of its type delivered. The program as depicted in the first chart showing only at a -1 backlog change for the year , indicating a production increase to fourteen monthly units is possible. Boeing already knows what orders will unfold in the next five months. Having a twelve a month pace for the last 90 days and during the 787-10 first test copies flying, suggests preparation for 14 a month delivery pace is an already a planned production change for 2018.

Fig. 1

In figure 2 below the 12 a month delivery schedule is on track.

Fig. 2

Fig. 3 The tracker indicates 2017 a robust 787 year.

Fig. 4 Program history to date.

Fig. 5 Program 787 model balance for delivery and orders.