Dreamliner – The OM Blog by Heizer, Render, & Munson

Video Tip: Building the New Boeing 787-9 Dreamliner

The wings are being installed onto the plane with heavy machinery

To celebrate the arrival of British Airways’ first 787-9 Dreamliner, it has released a time lapse video showing the aircraft being built at the Boeing factory in Everett, Washington.The behind the scenes footage shows the massive production that is involved in constructing the Dreamliner with parts flown in from all over the world on 747 Dreamlifter cargo planes.

The four-minute video goes inside the plane showing bathrooms being installed as well as galleys, overhead cabin bins and panels being fitted onto the aircraft.The video makes a nice fit to the Global Company Profile on Boeing that opens Chapter 2, Operations Strategy in a Global Environment. We think your students will enjoy it and that it can lead to interesting classroom discussions about global sourcing, assembly lines, project management, and quality.

The wings of the planes are lifted into place as are the engines and finally it is finished with a spray paint of the British Airways logo. British Airways has started flying the new stretched model (20 feet longer than the original 787) to Delhi. Routes to Abu Dhabi, Muscat, Kuala Lumpur and Austin will follow. The Boeing 787-9 Dreamliner seats around 250 passengers, has a flight range of 8,200 nautical miles, and uses 20% less fuel than the 747s.

Video Tip: Watching the Boeing 787 Being Built–in 3 Minutes

Jay and I have followed the Boeing 787 project closely for the past decade. The Global Company Profile that opens Chapter 2 details the plane’s design, supply chain, technology, and construction. The 787 has become one of Boeing’s most popular models due to its lightweight carbon composite airframe and the resulting lower fuel burn. Boeing continues to lose money on each Dreamliner it builds, but expects to reach the break-even point on the 787 program this year. The program’s deferred production cost, an accounting measure of how efficient an assembly program becomes over time, rose to $25.2 billion last year, topping the $25 billion cap Boeing had forecast for the 787.

Of course, the 787′s assembly costs will continue to drop over time as workers improve the efficiencies of the line and the rate at which they can build new planes. We discuss this issue on page 768, in Module E, noting the far-reaching consequences of learning curves. Boeing has a backlog of about 850 Dreamliner orders, on sales of 1,072 planes. It builds 10 each month at two plants and plans to boost output gradually to a dozen per month in 2016 and to 14 by 2020.

Your students will enjoy this 3-minute video showing the assembly line in Charleston S.C. The amazing thing about the building is there are no uprights supporting the roof. Six planes in various stages of completion are under the one roof. When completed, the plane is towed to the paint shop. Boeing has a runway that connects with the Charleston airport, and from here that the planes are delivered to customers.

You might show this video with Chapter 2, OM in a Global Environment (Boeing is one of the U.S.’s largest exporters), Chapter 9, Layout, or Module E.

OM in the News: Dreamliner Woes Test Boeing’s Corporate Ties in Japan

In the Global Company Profile that opens Chapter 2, we note the important and growing role Japan suppliers have played in Boeing’s 787. But the well-discussed woes of the Dreamliner (see The Wall Street Journal, Jan.29, 2013) are beginning to strain one of the aviation world’s coziest relationships: that between Boeing and its customers in Japan. All Nippon Airways, the first and largest operator of Boeing’s new 787, cancelled 459 flights through Jan. 31 after battery fires on two Dreamliners prompted regulators to ground the planes over two weeks ago. Rival Japan Airlines, which flies 7 Dreamliners and suffered a fire, has also been hit by the plane’s stoppage. “As an airline person, it’s exasperating to think that we’ve got 17 cutting-edge planes sitting here that can’t fly,” says ANA’s VP.

It’s not just the airlines that are affected. More than a third of each 787 is built by Japanese manufacturers before being sent to the U.S. for assembly. Roughly 43% of Japanese aerospace employment is linked to Boeing projects. In other markets, the Dreamliner’s delays and problems might prompt customer defections. But Japanese companies do so much business with Boeing that their fortunes are closely linked.

ANA and Japan Airlines flaunt their allegiance to Boeing. ANA, deeply involved in the design of the jet, boasts that its “passion persuaded Boeing” to use a durable Japan-made paint on the 787 and that the Dreamliner’s composition is “Japan 35%; Boeing 35%; Others 30%.” When the Dreamliner faced big delays between 2007 and 2010, Japanese aviation exports plummeted 25%.

The ties go back to U.S. support for Japanese reconstruction after World War II. In the 1970s and 1980s, Japanese airlines became big buyers of U.S. planes, partly to help offset a huge trade imbalance. “Ever since the war, Japan’s aviation industry has been basically America,” says one trade official.

Discussion questions:

1. Why did Boeing outsource such a large percent of its jets to Japanese suppliers?

2. Why have JAL and ANA remained loyal customers?

OM in the News: Boeing’s Dreamliner Nightmare

By now, you likely know that the Federal Aviation Administration (FAA) ordered U.S. airlines to ground the Boeing 787 Dreamliners in their fleets until the lithium-ion batteries on the planes could be proved reliable. The FAA’s action, writes USA Today (Jan.17, 2013), came after Japan’s two largest airlines grounded their combined 787 fleets because an All Nippon Airways (ANA) plane had to make an emergency landing when the crew detected a battery’s burning smell.

The 24 Dreamliners flown by ANA and Japan Airlines represent nearly half the 50 that Boeing has delivered to airlines. More than 800 of the planes are on order. The Dreamliner is Boeing’s newest and most technologically advanced jet, and the company is counting heavily on its success; it is the first commercial aircraft to be made largely of lightweight, fuel saving, carbon composites rather than conventional aluminum and steel. Passengers like the airy cabins, large windows and comfortable humidity.

But the Dreamliner has had technological and supply chain problems from the start, which resulted in its being 3 years late in delivery. Last month, United Airlines and Qatar Airways had to divert or ground planes because of electrical issues. The 787 relies heavily on electricity and thus needs the large lithium-ion batteries to power it. Batteries, though, aren’t the plane’s only problem: On Jan. 8, a fuel leak on a Japan Airlines flight to Tokyo was detected before takeoff from Boston. On Jan. 11, cracks were spotted in the cockpit window of an ANA in Japan. The same day, another ANA flight was delayed because of an oil leak from an engine generator.

Boeing has said the 787’s reliability is “well above 90%.” As you teach reliability in Chapter 17, however, recall that the overall reliability of the Space Shuttle was .98–and, indeed, 2 Shuttles crashed out of 100+ flights.

How do passenger’s feel about the plane? “The uncertainty surrounding the Dreamliner makes it a plane that isn’t one that you can book and expect to fly reliably,” says one travel analyst.

Discussion questions:

1. What is the major operations issue facing Boeing right now?

2. What was the reliability of other technologically new planes introduced in the past 50 years?

OM in the News: Quality and the Dreamliner

When we discuss quality in Chapter 6, we note that there are 3 views of the term. The 1st is user-based — quality “lies the eyes of the beholder.” The 2nd is manufacturing-based–conforming to standards. And the 3rd is product-based–quality is a “precise and measurable variable”. The Wall Street Journal’s article ( Feb.16,2012), “How Dreamy is the Dreamliner”, covers all three in analyzing Boeing’s new 787, which is now in its 4th month of service and flying daily from Tokyo to Frankfurt for All Nippon Airways.

To passengers (users), the plane approaches a revolution in air travel with better cabin climate, less airsickness, reduced jet lag, and fewer headaches. The humidity level is a more breathable 10-15%, vs. 4-7% for existing planes. The cabin pressurizes at 6,000 feet vs. 8,000 feet on others. Overhead bins are 2 inches larger. Big windows help reduce motion sickness, and a new stability system makes for a smoother ride in turbulence. Cabin attendants even claim the atmosphere is much better for their skin.

From a manufacturing perspective, the body of the plane, constructed from super-strong plastics — carbon fibre composite materials — instead of aluminum, makes the plane lighter and more fuel-efficient. And the number of holes drilled in the fuselage (under 10,000 vs. 1 million in a 747) means better aerodynamics.

The products-based view of quality can claim a plane that flies at Mach .85, compared to Mach .785 for a Boeing 737. Fuel efficiency and emissions are 20% better than on a similar-sized 767.

Discussion questions:

1. Did Boeing’s continuing supply chain problems on the 787 impact the plane’s quality?

2. Which aspect of quality is most important to Boeing? To the airline buying the 787? To the passenger?