OM in the News: Everything Has a Life Cycle, Including the 747

Retired Delta 747s in the Arizona desert

There may be no airliner as recognizable as the Boeing 747, the world’s first jumbo jet, with its iconic hump of an upper deck. The introduction of the “Queen of the Skies” was a triumph of engineering and grace: unprecedented size and speed with spiral-staircase international glamour. But the airline business has changed, and the giant plane has become more expensive to operate. A couple of weeks ago, the final 747 flight by any commercial U.S. airline took to the sky.

“Like so many others before it,” writes The New York Times (Jan. 20, 2018), “the plane was heading to the Southwest to retire.”  Hours after takeoff from Delta’s Atlanta hub, the jet was circling Arizona’s Sonoran Desert, making its final approach to Pinal Airpark, between Phoenix and Tucson. It’s an ideal place to store airplanes long-term, and about 120 aircraft are parked there now, scattered across the desert floor. The dry air prevents major corrosion, so their parts can be used to help keep other planes flying. About 50% of the retirees are stripped and sold for scrap. But some end up working for air carriers in Africa, Asia and South America, for whom buying a used aircraft is a lot more affordable than buying new, even though they are less fuel-efficient.

The 747 aircraft was a marvel for when it was built. But, a marvel of 1960s engineering is not necessarily suited to 2018 industry needs. Many airlines are moving to a business model that focuses on connecting more cities directly with smaller, more fuel-efficient planes, rather than funneling passengers through a few large hubs. As we state in Chapter 5: “Products are born. They live and they die.”

Classroom discussion questions:

  1. How is production of a 747 different from making a 737?
  2. What are the major OM issues facing Boeing, as maker of the 747, and customers of the plane, such as Delta?

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