Boeing may rethink global supply chain for next jet

  • By Michelle Dunlop Herald Writer
  • Wednesday, October 31, 2007 10:57am
  • Business

EVERETT — Not all suppliers are created equal. The Boeing Co. found that out when building a global supply chain for its new 787 Dreamliner.

Boeing assumed each of its primary 787 partners — stretching from Italy to South Carolina, from Kansas to Japan — could design and build major assemblies for the new jet.

“Some of them proved incapable of doing it,” said Mike Bair, former head of the 787 program.

That bit of bad news for Boeing could translate to more jobs and business for the Puget Sound region when the aerospace company begins its next new jet program. While Boeing still firmly believes in partnering with global companies, Bair said, it may take a different approach the next time around.

Nearly a month after Boeing officially delayed deliveries of its 787 by six months, and just weeks after he was reassigned to a marketing position within Boeing, Bair addressed the Snohomish County Economic Development Council on Wednesday morning. From its early phases, Bair had led the Dreamliner program, including overseeing coordination with Boeing’s global partners.

Looking back on the experience, Bair said, “We made a bunch of mistakes, and we learned a lot.”

Boeing learned that not all of its new suppliers could handle the detailed design work associated with the mostly carbon fiber composite aircraft. Some suppliers contracted out the design effort on the assemblies for which they were responsible. Others just couldn’t live up to the task, forcing Boeing to take back design responsibilities.

“Some of these guys we won’t use again,” Bair said.

Dreamliner suppliers ship major components to Boeing’s Everett facility via a fleet of modified 747 cargo jets, called Dreamlifters. Workers in Everett piece the fuel-efficient Dreamliner together using a new production process — one that Boeing still is ironing out.

“It’s an elegant solution to having suppliers in the wrong spot,” Bair said about using the Dreamlifter fleet.

However, he said, Boeing has realized its worldwide assembly line isn’t the most efficient method of building a commercial jet. When Boeing launches its next commercial jet — likely a replacement for either the single-aisle 737 or twin-aisle 777 — the company will put pressure on suppliers to locate in a more central location.

While Snohomish County could fit the bill, Bair suggested Boeing would conduct a search, like it did for the 787, for the best spot to locate a new jet program.

Bair voiced confidence that his replacement, Pat Shanahan, a former vice president in Boeing’s defense division, would deliver the first 787 in late 2008 in accordance with Boeing’s revised schedule. Shanahan has experience with dealing with troubles, Bair said. In addition to its supplier issues, Boeing has wrestled with a shortage of fasteners for the 787.

“Pat has a great track record for driving things to completion,” Bair said.

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