Boeing Executive Faults some 787 Suppliers

Sidney Vianna

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https://seattlepi.nwsource.com/business/337793_boeing02.html

Public criticism is an unusual move

By JAMES WALLACE
P-I AEROSPACE REPORTER
In unusually blunt language for a top executive of The Boeing Co., Mike Bair, who was recently replaced as head of the troubled 787 program, said some suppliers have let the company down.
"Some of these guys we won't use again," Bair said Wednesday in a speech to the Snohomish County Economic Development Council.
He did not name names.
Did Bair mean to include Boeing's top-tier partners in the U.S., Italy and Japan that are responsible for manufacturing the composite wings and fuselage sections of the new jet?
"The suppliers you name and some of their subtiers," a Boeing spokesman said Thursday when asked to clarify Bair's comments.
One industry analyst called Bair's speech "remarkable."
"It's remarkable that Boeing is saying publicly that some of their world partners are falling down on the job and that Boeing made a mistake and that they will do it differently the next time," said Scott Hamilton of Leeham.net.
Bair did not have a prepared speech, Boeing said.
For Boeing's next all-new jet program after the 787, Bair said, it would be better to have a central manufacturing site rather than the global assembly method that is being used for the 787.
He said Boeing would put pressure on its suppliers the next time to locate in the same area.
The 787 production system requires modified 747 freighters to ferry the large wings and fuselage sections from the various manufacturing sites around the world, with final assembly at Boeing's Everett plant.
"It's an elegant solution to having suppliers in the wrong spot," Bair said.
Bair, who had led the 787 from its start, was replaced last month, shortly after the company announced a six-month delay in delivering the first planes to customers because of supply-chain and production problems.
Boeing workers at the Everett factory were overwhelmed by work that should have been done by suppliers.
Boeing has yet to complete work on the first plane, which has remained in the factory since its official unveiling on July 8.
First flight of that plane, initially set for late August or early September, has been delayed until the late first quarter of next year, Boeing said.
On the 787 program, Boeing gave some of the design work to suppliers, in addition to manufacturing responsibilities.
Bair said some of that design work had to be done by Boeing when some suppliers "proved incapable of doing it." The 787 will be the first large commercial jet made mostly of carbon fiber-reinforced composites instead of aluminum.
The major 787 partners include the three Japanese heavies: Mitsubishi makes the wings; Kawasaki a section of the forward fuselage, the main landing-gear wheel well and the fixed trailing edges of the wings; and Fuji the center wing box.
Alenia Aeronautica of Italy produces the center fuselage and horizontal stabilizer.
Vought Aircraft Industries in South Carolina makes the rear fuselage section. Vought and Alenia also have a joint assembly facility in Charleston.
Spirit AeroSystems in Kansas makes the nose and forward fuselage.
Boeing has acknowledged problems at the plants in Japan, Italy and South Carolina, and the company has sent hundreds of its own people to those sites to help get things on track.
"We made a bunch of mistakes and we learned a lot," Bair said.
In a recent conference call with media and analysts, Jim McNerney, chairman and chief executive of Boeing, said the 787 production system -- an industry first -- has not worked as well as planned. But he said it is still the best and most efficient way to build airplanes once the early kinks are worked out.
Airbus, in fact, plans a similar production system for its A350 jetliner due in 2013.
The Boeing spokeswoman said Bair, in his speech, was not suggesting the 787 productions system is flawed and should be scrapped, only that it would be better to have the main manufacturing partners together and located near Boeing's final assembly facility.
After being replaced as the 787 boss, Bair, 51, was handed a new assignment as senior vice president of business strategy and marketing for the commercial airplanes unit.
In that job, he will direct the business strategy for new airplane programs, including the ongoing study of a 737 replacement.
Bair said in his speech that Boeing might conduct a search to determine where to build the next new plane.
In an interview last year, McNerney told the Seattle P-I that Boeing will consider locations outside Washington state for the next plane.
"It is hard to imagine doing it someplace else, but we will look at alternatives," McNerney said.
In his speech, Bair expressed confidence that his replacement, Pat Shanahan, is up to the task. Shanahan led two commercial airplane programs before transferring to Boeing's defense unit.
"Pat has a great track record for driving things to completion," Bair said.
Hamilton said Bair's speech confirms what many in the industry had already suspected: Boeing has serious production problems.
"They have issues with front-line partners, and not just with second- and third-tier suppliers," Hamilton said.
"If things are in this much disarray, what's next?"
 

BradM

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Interesting indeed...

So are the prisoners running the prison?? I mean, I find it a little shallow that Boeing is blaming their Supply Chain for their problems. It's funny how every other leading company can utilize a global Supply Chain for best competitive advantage. Yet, Boeing finds it as the problem.
 

Stijloor

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Boeing suppliers.....

  • Boeing suppliers.
  • Boeing honors (broken link removed) with top performance award.
  • Boeing sees supplier diversity as smart business.
  • Fujitsu Consulting Counted Among Boeing's Suppliers of the Year.
  • (broken link removed) are global partners at Boeing.

Stijloor.
 

Wes Bucey

Prophet of Profit
Interesting indeed...

So are the prisoners running the prison?? I mean, I find it a little shallow that Boeing is blaming their Supply Chain for their problems. It's funny how every other leading company can utilize a global Supply Chain for best competitive advantage. Yet, Boeing finds it as the problem.
I think you'd have to ask Mattel whether global outsourcing was a problem before you can say "It's funny how every other leading company can utilize a global Supply Chain for best competitive advantage." with impunity.

I note one item in in the "woulda, coulda, shoulda" category that seemed to echo a Toyota concept - that of having the suppliers locate or create a facility close by the main final assembly site. I'd be willing to speculate that concept at Toyota was the result of similar supply chain problems to those being experienced by Boeing and the "manufacturing village" of Toyota was more a Corrective Action (after the problems arose) than a Preventive one (anticipating and preventing problems BEFORE they were experienced.)

Boeing's hubris may have been thinking they were in the AIRPLANE business, rather than in the TRANSPORTATION business. Thus they figured solutions achieved by auto companies had no relevance for them.

What is it that folks say about history? Something like, "They who fail to study history are condemned to repeat it."
 
B

Benjamin28

Seems like a simple case of live and learn. This type of production system is completely new in the realm of aircraft manufacturing, as such I would expect problems, and I would expect solutions and improvements. It doesn't surprize that the 787 production system will have many parallels to automotive and that Boeing will need to improve it's supplier management processes as their new production system is extremely supplier dependant.
 

BradM

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I think you'd have to ask Mattel whether global outsourcing was a problem before you can say "It's funny how every other leading company can utilize a global Supply Chain for best competitive advantage." with impunity.

Good points, Wes. So let's take your example. One company complaining about the problem, and another (Mattel) with actual problems. I would even submit that the sole entity responsible for the problem with Mattel, is Mattel. The same with Boeing.

Does Caveat Emptor ring a bell? I'm certainly not giving anyone a pass. I'm just saying that passing the buck gets old sometimes. In the reading of the Boeing case, I assess Boeing more at fault than the suppliers.

1. Why did Boeing let things get that bad?
2. If they are that incompetent of suppliers, why did they pick them in the first place?
3. I sense a complete lack of effort in managing the supply chain.

We are in a new world here. Quality systems are more important now than they have ever been. Quality systems and quality tools that have been in use for years can assist with managing the supply chain. But management has to be willing to commit (and take responsibility).
 
D

duecesevenOS - 2009

Good for Boeing for admitting their mistakes I say. The comments might have been a little harsh about their suppliers but sometimes it's necessary.

They have also been sending hundreds of employees to all of the suppliers to help them get out of their messes. I hope that the idea of going with other suppliers next time is just an empty threat to get the suppliers in gear however. One of Toyota's biggest assets is that they are absolutely and strictly loyal to their suppliers. If Boeing doesn't understand the fact that they are investing a huge amount of money into all of these suppliers right now, and they get rid of them...that would be a huge mistake. Some of Toyota's best and most efficient suppliers were the ones that Toyota had to "go fix."

They do have to do something about the long distance wastes of transporting but dropping their supplier base is a bad idea. Work with the base to make it better.
 
C

Craig H.

1. Why did Boeing let things get that bad?
2. If they are that incompetent of suppliers, why did they pick them in the first place?
3. I sense a complete lack of effort in managing the supply chain.

Yes.

If there was just one supplier, then fire away. Having MULTIPLE tier-ones in the crosshairs means only one thing to me. Physician, heal thyself.
 
B

Benjamin28

:yes:

Linked in another thread, this gives a good overview of what Boeing is trying to accomplish in regard to 787 production line, thought I'd put it here as well for anyone who had missed the article.

(broken link removed)
 

Scott Catron

True Artisan
Super Moderator
Boeing said:
Bair said some of that design work had to be done by Boeing when some suppliers "proved incapable of doing it."

If they are that incompetent of suppliers, why did they pick them in the first place?

I was wondering about this also - how did they choose these companies? Did the suppliers over-state their abilities? Who knows? Did Boeing do a poor job of qualifying them? Obviously, yes.
 
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