20 years after 777’s first commercial flight, Boeing crafts a successor

EVERETT — On June 7, 1995, a United Airlines Boeing 777, tail number N777UA, took off from London, headed for Dulles International Airport near Washington, D.C. Twenty years later, that same plane is still flying trans-Atlantic routes for United.

Since its introduction, Boeing’s 777 has come to dominate long-haul flying and is one of the most commercially successful twin-aisle airplane programs in the world. The airplane has no direct competitor in service, though that is changing. New airplanes from Airbus and even Boeing have cut into the 777’s market share, prompting Boeing to develop a largely new successor airplane, the 777X, rather than make another derivative.

Similar market conditions in the 1980s led Boeing to develop the original 777, a process which also changed how the company designs and produces new airplanes.

After entering service in 1995, the 777 quickly took the lead over the competition. While it incorporated the latest technologies, the airplane was not a technological or design leap like the 707 or 747. Success came from reliable performance and the fact Boeing bet correctly on two trends: increasingly reliable jet engines and the growing market for belly cargo on passenger flights.

Trans-oceanic twin

By the 1980s, Airbus had significantly eaten into Boeing’s share of the twin-aisle jetliner market.

“The 767 was starting to lose some campaigns against the A330, so we knew we needed to do something,” said Lars Andersen, a Boeing vice president who was with the 777 program from the beginning.

In response, Boeing shopped around bigger versions of the 767, including one with a partial second deck that was called the “Hunchback of Mukilteo.” But airlines were not interested, Andersen said.

By 1989, the company committed to a new airplane family whose variants would fly circles around the competition in terms of range, passenger capacity and efficiency.

Boeing was chasing the competition. McDonnell-Douglas was already producing its trijet MD-11 and Airbus was working on the A330/A340 family. The smaller A330 had two engines, but the long-range A340 had four engines, which was the standard on trans-oceanic flights.

At the time, the Federal Aviation Administration and foreign counterparts placed strict limits on how far twin-engine airplanes could fly from an airport where a plane could land if one engine failed.

Jet engines, though, had steadily improved over the years, and the FAA incrementally increased the limit, called extended-range twin-engine operational performance standards, or ETOPS.

“ETOPS was still controversial 20 years ago,” said Richard Aboulafia, an aerospace analyst and vice president with Fairfax, Virginia-based Teal Group. “The joke was it stood for ‘engines turning or passengers swimming.’”

Boeing worked with aviation authorities and airlines around the world to ensure that the first 777 would have ETOPS certification to fly trans-oceanic flights as soon as it entered service, Andersen said.

Four-engine airplanes cost more to maintain than twin-jets, so that certification gave the 777 an edge over the comparably sized quad-jet A340 and the tri-jet MD-11.

United Airlines placed the first order, for 34 777s, on Oct. 15, 1990. That day executives from the two companies sketched out the program’s goals on a sheet of yellow legal paper. The handwritten note reads:

“From day one:

“Best dispatch reliability in the industry.

“Greatest customer appeal in the industry.

“User friendly and everything works.”

The company set first delivery for May 1995, a target it hit.

Design collaboration

From the beginning, Boeing brought United and other customers into the design process, as well as people from Boeing’s production teams. It was the first time the company integrated the design-build process. It was also the first airplane designed entirely on computers.

On previous programs, engineers would design an airplane and hand it over to production to figure out how to build it, said Mike Heide, who joined the 777 program at the beginning, when it was still based in Renton. “They’d design it and throw it over the wall” to production.

That led to expensive redesign and rework. By changing the approach on the 777, Boeing all but eliminated that extra work.

Boeing expanded the Everett plant for 777 assembly, making it the biggest building by volume in the world. In 1993, the program moved from Renton to Everett.

Adopting the new design-build approach and leaner manufacturing was a “huge” cultural shift, Heide said. “It wasn’t an easy cultural change.”

Boeing 777 program executives — especially Bert Welliver and Alan Mulally — championed the new approaches, and CEO Frank Shrontz supported the change. But they didn’t simply mandate it from above. They gave managers and workers space to buy into it, Heide said.

The 777 was Boeing’s first fly-by-wire airplane and used more composite material — about 12 percent of the plane — than any previous jetliner. For the first time, Boeing used composites on an airplane’s major structures. They were used on much of the 777’s empennage, the vertical and horizontal fins on the tail.

Boeing learned a lot about composites from that experience, Andersen said. “It was the first step in the evolution toward the 787.”

The biggest production challenge was ensuring the airplane had industry-leading reliability from the start, he said. It meant rigorously testing the plane’s systems during production and a robust flight-test program, which started June 12, 1994.

“It was just a lot of work because you find stuff and you’ve got to fix it,” and roll it back into production, he said.

Nonetheless, Boeing met its deadline and delivered the first 777, a 777-200, to United on May 15, 1995.

Less than a month later, passengers were crossing the Atlantic on the airplane.

Gradual domination

The 777 didn’t dominate the market right out of the gate.

By 1995, McDonnell-Douglas’ MD-11 had flopped. It hadn’t lived up to what the company had promised to customers.

Airbus stuck with its four-engine A340, but it was a losing battle. The program ended production in 2012. The company’s smaller A330 has done well, booking almost as many orders as the 777. However, that plane is closer in size to Boeing’s 767.

Two 777 variants helped cement its lead in the twin-jet market. Boeing introduced the 777-200ER — or extended range — in 1997. That plane led the program in orders until it was superceded by the 777-300ER, which was first delivered in 2004. The company also introduced a dedicated freighter in 2009.

The 777 dominates the long-haul market. “You could say that anyone without a 777 is either not a serious player, or Lufthansa and Qantas,” the only two major air carriers that don’t have 777s, Aboulafia, the aerospace analyst, wrote in a report in February.

The airplane’s spacious belly holds so much cargo that it has weakened demand for dedicated air freighters.

The lack of direct competition has made the airplane a cash cow. The cost of purchasing an airplane is often discounted 50 percent from the publicized price. But Boeing has been able to keep the 777’s actual price closer to 60 percent of list, Aboulafia said.

However, competitors are coming. Airbus’ A330neo and the new A350, and even Boeing’s 787-10, the biggest Dreamliner variant, all threaten to eat away at the 777’s market share.

Boeing hesitated on how to respond, allowing the A350 to pick up key orders before Boeing committed to a new airplane, the 777X. The 777X is slated to enter service in 2020. As with the 777 classic, the X is coming last to market.

“We’ll be very competitive against all newcomers,” said Bob Feldmann, a Boeing vice president and head of the 777X program.

The 777X is expected to use 20 percent less fuel compared to current 777s.

“We can’t go backwards in reliability,” he said. The new airplane has to be as reliable, or better than, current 777s.

“Every time we listen to our customers, the airplane gets better,” Feldmann said.

He expects production rates similar to the 777’s current 8.3 a month.

The promise of a new airplane with better performance has hurt demand for the 777-300ER, forcing Boeing to offer greater price discounts.

Earlier this year, the company unveiled several upgrades that will cut the airplane’s fuel use by as much as 5 percent. Not long after that, United Airlines switched orders for 10 787s to 777-300ERs.

Even after the 777X comes on line, the company expects to continue producing 777 freighters.

“If the 777 story tells us anything, it’s that the guy with the biggest twin jet wins,” Aboulafia said.

Boeing 777 orders and deliveries

Through May 2015. Models listed in order of introduction.

Model	Orders	Deliveries	Unfilled
777-200	88	88	—
777-200ER	422	422	—
777-300	60	60	—
777-300ER	786	570	216
777-200LR	59	59	—
777F	151	105	46
777X	286	—	286
Total	1,852	1,304	548