Breaking: Boeing to Buy Out Vought on 787 Center Fuselage

I thought you were wrong when I read your article in December. I figured, with Boeing trying to divest themselves of manufacturing, they would get Spirit to pony up and buy Vought outright.

Great call - check's in the mail :)

I still believe Spirit's a manufacturing force to be reckoned with.

The key quote:

"Vought will continue to produce the aft fuselage for the 787"

Contrary to what your post seems to imply, Boeing is NOT taking over production of the aft fuselage sections that are rumored to have caused so much trouble.

Thanks for that last comment. You're absolutely right, the headline is far to broad. My mistake. I just made the change to clarify.

Thanks,

Jon

Was there even any issues with this part of the aircraft?

From the Wall Street Journal

Boeing to Buy Stake in Plant
Doing Dreamliner Assembly
By J. LYNN LUNSFORD
March 29, 2008

In a step back from its effort to share development of the hot-selling 787 jetliner with suppliers, Boeing Co. took over a partner's half of a key assembly site.

Boeing's approach originally was intended as a way to spread billions of dollars in development costs among a large number of suppliers, while also streamling its own manufacturing. But the web of suppliers crisscrossing the globe has contributed to several delays for the twin-aisle aircraft, hitting Boeing's share price and stirring concern among customers.
[Image]
Associated Press
Boeing's assembly plant in Everett, Wash.

Boeing, in its new bid to get the 787 Dreamliner back on track, said Friday that it will buy out Vought Aircraft Industries Inc.'s interest in an assembly plant in North Charleston, S.C. The facility, called Global Aeronautica LLC, is a joint venture between Vought and Italy's Alenia Aeronautica.

Dallas-based Vought is a key player in Boeing's attempt to reinvent its production process for the 787 by giving more responsibility to suppliers who design, produce and integrate large sections of the jet. In this case, Vought and Alenia join large sections of the jetliner together before they are shipped to the Seattle area for final assembly.

Some suppliers, including Vought, have struggled with the new responsibilities, contributing to chronic delays in the 787 production process. Boeing is trying to overcome those problems by taking a direct stake in the assembly plant.

The companies did not disclose terms of the deal, but Boeing said it had no effect on its current financial forecasts. After the transaction is complete, Global Aeronautica will become a 50-50 joint venture between Boeing and Alenia North America, a subsidiary of Alenia Aeronautica, which is a unit of Italy's Finmeccanica SpA. Vought will continue to manufacture the two rear sections of the fuselage at an adjacent plant.

For Boeing, the move is a further acknowledgement that it put too much of its future in the hands of suppliers that were unaccustomed to the giant tasks assigned them in producing the 787. By taking an active role in Global Aeronautica, which employs 300 people, Boeing will be better able to make changes that will "enable the 787 team to continue to overcome supply-chain challenges of the program," said Pat Shanahan, the Boeing vice president in charge of the program. Boeing has other major suppliers in Italy, Japan, South Carolina and Kansas.

Although it has garnered almost 900 orders from airlines around the world, the Dreamliner has been beset by parts shortages and difficulties among suppliers in bringing together all of the components. Global Aeronautica's plant in South Carolina is the staging site where major fuselage sections from four of Boeing's supplier-partners are supposed to be pre-assembled. The Dreamliner is already running nine months behind schedule and is expected to slip at least another six months when Boeing gives its next update on the program early next month.

Boeing attributes much of the delay to inefficiencies at Global Aeronautica, where the sections are joined and critical subsystems such as wiring are supposed to be installed. Instead, many of these systems for the first airplanes have been shipped separately to Boeing's final assembly plant in Everett, Wash., where the avalanche of parts overwhelmed a plant that was set up to snap together already completed sections.

A Boeing spokeswoman said that, in recent weeks, Boeing had helped eliminate four days from the time it takes to drill holes in fuselage sections when they arrive at Global. Boeing also has identified modifications to equipment that will allow the factory to reach full production rates more swiftly, the spokeswoman said.

In recent months, Vought frequently emerged as the partner that was having the most difficulty in making the transition from simply providing parts to taking on major management roles in a larger venture. As delays mounted, Vought also warned that it was running low on cash and was in the midst of renegotiating financial terms with Boeing.

Elmer Doty, Vought's president and chief executive officer, said in a statement that Vought's 787 team "remains focused on manufacturing composite fuselage sections for this incredible airplane."

In a memorandum distributed to Vought's employees on Friday, Mr. Doty said it had become apparent over the past year that Global Aeronautica's role would require the "extensive involvement" that is more suited to an original equipment manufacturer such as Boeing. "The sale of our share of Global Aeronautica announced today reflects the recognition of this fact," he said.

Giuseppe Giordo, president and CEO of Alenia North America, said in a statement that Alenia is "confident that with Boeing as an investor, the successful work of Global Aeronautica will continue, thanks to the hard work and dedication of its management and employees."

With Vought's experience at making major sections of passenger aircraft I am disappointed at this event. Good move on Boeing's part.

Global is NOT a manufacturing point in the 787 chain. It is an integration location for sections to be joined. Vought is NOT being bought out of any sections of the fuselage, they are simply stepping back from a point in the process that should be controlled by Boeing anyhow.

well, this is right time for Boeing to buy a supplier. Programme halted, so shares at lowest. Another strategic move from Boeing.

Boeing now owns 50% of an assembly factory in South Carolina. If they had tried to move out of Puget Sound, they couldn't have done it. The Global Aeronautica operation is basically taking thousands of Boeing supplied parts and putting them together and shipping to the Boeing final assembly--sounds like something Boeing never should have relinquished, and GA is to be distinguished from the outsourcing of the manufacture of various structural parts to Vought, Alenia, Spririt, etc.

The Boeing people have been working this site for quite a while, so IMO this is not going to be considered a quick-fix.
Maybe decisions can be made quicker with Vought removed from the process.

I wonder what this little twist will do for the relationship with the other partners? The ones that are actually making parts? Doesn't seem like it gives them much incentive to stop staring at their feet and wringing their hands. "Gee... maybe if we continue to drag our feet, they'll buy us too!"