October 2009 Archives

I'm pretty sure it's a safe bet to say that October 2009 has been the single busiest month I've had at Flight since I first started almost two years ago. Needless to say, I've been bad about keeping up with this regular posting with all the travel. Here's a good recap of the last month of what I've been up to beyond FlightBlogger.

Boeing plans 787 'surge', selects Charleston for second line - FlightGlobal
Boeing will surge 787 production early to meet customer demand as part of the establishment of the newly announced Charleston 787 second line.

United Airlines retires its last 737 - USA Today

Boeing completes detailed design of 787 wing fix - FlightGlobal

Boeing engineers have completed detailed design and computer validation of the final aspects of the 787 wing fix, the company says. The the final parts are currently being fabricated for the side of body modification that has kept the 787 grounded.

World Airliners Special - Gigantic problems - ultra large airliners - FlightGlobal
When Boeing's 747-100 entered service in 1970, operators around the globe realised unprecedented efficiencies in seat-km costs, reducing the cost of world travel and bolstering the financial bottom line for airlines and later for air freight operators.

NBAA 09: Livemercial shows off airliner-turned-luxuryliner - Flight Evening News
Livemercial aims to deliver business jet comfort at an airline operator's cost by converting small airliners to VIP configurations.

NBAA 09: EAA underscores importance of young people to the future of aviation - Flight Evening News
As EAA celebrated flying more than 1.5 million young people over the past 17 years as part of the Young Eagles program, the organization looks to the future of the aerospace industry.

NBAA 09: Cautious Gulfstream sees reason to be optimistic - Flight Evening News
The business aviation industry is not out of the woods just yet, but General Dynamics executive vice-president Joe Lombardo is cautiously optimistic about the prospect for the future.

NBAA 09: Airbus Corporate Jet Centre launches VIP Pass - Flight Evening News
The Airbus Corporate Jet Centre (ACJC) has launched a "VIP Pass" program for its jetliner-derived business aircraft, offering a tailored package of services to executive, private and government operators for its ACJ family of aircraft.

NBAA 09: Hawker Beechcraft's Boisture sees 'protracted conflict' - Flight Evening News
In a military style press conference, Hawker Beechcraft leadership struck a confident note amid a tumultuous year that has taken its toll on the airframer

NBAA 09: Wichita woes - FlightGlobal
The Wichita aerospace cluster is the story of a city transformed by a global economic downturn that saw near-collapse in the credit market, slowing corporate profits and a headwind of public opinion that branded business aircraft as luxury jets and foolish expenditures for the dalliances of the ultra-wealthy.

NBAA 09: Hitting back at the critics - FlightGlobal
On 19 November 2008, just days after the US Presidential election, auto executives from Chrysler, Ford and General Motors flew to Washington DC aboard their company business aircraft to ask a lame-duck session of Congress for $25 billion in bailout funding to stave off a complete collapse US car industry.

Dreamliner troubles return to haunt 747-8F - FlightGlobal
The diversion of engineering resources to Boeing's troubled Dreamliner has forced the airframer to give up on its plan to fly the first 747-8 Freighter on 9 December and deliver an aircraft to Cargolux in the third quarter of next year.

New Photos, Videos & Podcasts
I've added 209 new photos to my Flickr feed in the last month, including 190 from NBAA and 29 shots from flying around Seattle in a Cessna 172 last May with pilot/photographer Charles Conklin. I've also uploaded six new videos to YouTube as well, covering the Airbus tray table, the interior models of the 747-8I and 787 VIP, the unveiling of the Embraer Legacy 650 and the Panasonic Fusion IFE seat design. I also managed to squeeze in two podcast. One discussing business aviation with the Airplane Geeks and another about the selection of Charleston for the second 787 line with IAG. Phew, what a month.

The late afternoon sunshine in Hamburg set the scene for the handover of the first 538-seat Airbus A380 to Air France. Operating as AFR380V, MSN033 (F-HPJA) departed XFW at 2:39 PM local time for Paris.

Everett's Surge
Over the next two years or so, Boeing will continue to ramp up 787-8 production with the help of the newly-announced temporary surge line. The line will be established on the existing 767 line inside Building 40-24, two bays down from the current 787 line, say company sources. The 767, which will continue operating at around a 1-per month production rate, will be turned around in the back of 40-24 and roll out of Building 40-34. Boeing may have to make provisions to ensure a fully assembled 767 can transit to the flight line. Sometime in 2012, Boeing will begin final assembly and testing of the first 787-9 in Everett, where the aircraft will be built. Seven of the 10 787s assembled per month will originate in Everett.

Charleston Timeline
Boeing says that the Charleston line will be up and running by July 2011, with groundbreaking in the next few weeks. For the sake of comparison, Global Aeronautica ground breaking was February 7, 2005, with tooling and equipment moved into the facility by December 2006. Initially the plan is to have Boeing Charleston build 3 787-8s per month as part of the 10 per month ramp up. First delivery of a 787-8 from Boeing Charleston is planned for the first quarter of 2012.

Dreamlifter Dynamics
With the second line set to be up and running by 2012, the small fleet of modified 747 LCF Dreamlifters will be deployed differently than they currently are now. The number of inbound structural delivery flights to Everett is now seven per aircraft. For Charleston, best estimates show that that number would reduce to six. This is mainly because without the aft and center fuselages will be built on site in Charleston. Boeing saves flights of the horizontal stabilizer, however, the wings will have an additional flight from PAE to CHS and the vertical tail plane will also likely be flown from BFI (closer to Frederickson, WA) to CHS. The total distance traveled by the LCF is 16405 nm to Everett vs. 13933 nm to Charleston.

EVERETT	ROUTE	Flights	Distance
WINGS (Nagoya, JP)	NGO-ANC-PAE	2	4369
FWD FUSE (Wichita)	IAB-PAE	1	1258
HTP (Foggia, IT)	TAR-CHS-PAE	2	6574
CENTER & AFT (Charleston)	CHS-PAE	2	4205
	TOTAL:	7	16405	NM

CHARLESTON	ROUTE	Flights	Distance
WINGS (Nagoya, JP)	NGO-ANC-PAE-CHS	3	6471
FWD FUSE (Wichita)	IAB-CHS	1	891
HTP (Foggia, IT)	TAR-CHS	1	4472
VTP (Washington)	BFI-CHS	1	2099
	TOTAL:	6	13933	NM

Delivery Geography
Though not officially announced, there is a the possibility of shaping the 787 firing order based on the geographical location of the customer. I spoke with one program source yesterday who said that Boeing may consider delivering European and African 787s through Charleston and Asia/Pacific 787s through Everett to take advantage of the relative proximity of each line.

The Tanker Wild Card
Hanging out in the not so distant future is the USAF KC-X tanker deal. If Boeing wins this iteration of the competition, the KC-767 or KC-777 will be built in Everett, however the mission systems installation will be done elsewhere. That location was always thought to be McConnell Air Force Base in Wichita, Kansas, however, Boeing now says they will choose the cheapest location for the modifications, which could now mean that Charleston is in the mix. Boeing went to great lengths to say that the Charleston line is only for 787 work, but let's file this one under wild card.

Photo Credit Boeing

UPDATE 6:45 PM: Reaction:

• IAM District President Tom Wroblewski
• Washington Governor Chris Gregoire
• Washington Congressman Jim McDermott
• Washington Congressman Rick Larsen
  
• US Senator Patty Murray WA
• US Senator Maria Cantwell WA
  
• Snohomish County Executive Aaron Reardon
• Everett Mayor Ray Stephanson
• US Senator Lindsey Graham SC (audio)
  
• US Senator Jim DeMint SC
  
• South Carolina Governor Mark Sanford
• South Carolina Gubernatorial Candidate Dwight Drake
• South Carolina Gubernatorial Candidate Gresham Barrett
  

UPDATE 5:18 PM: Internal message from Boeing Commercial Airplanes CEO Jim Albaugh:

A few minutes ago the Board of Directors approved the selection of North Charleston, S.C., as the location for a second final assembly site for the 787. A news release will be issued shortly. At 2:30 p.m. today, Pat Shanahan, Ray Conner and Scott Fancher will hold an all-manager webcast from Everett to provide details and answer questions. A Q&A document also will be distributed to help you answer questions from your teams.

I know this decision may be of concern to many of our employees in Puget Sound, and I am counting on all managers to help everyone focus on the larger picture. Establishing a second 787 assembly line in Charleston will expand our production capability, diversify our manufacturing base and ultimately drive down the cost of the 787 -- sustaining our competitiveness. We are adding jobs in South Carolina, not taking them away from Puget Sound. We expect there will be speculation among employees and in the media about what role the IAM played in this decision. While the union did not give us reasonable assurances or sustainable economics, this ultimately came down to a strategic decision for the long-term growth of the company.

Puget Sound has and will continue to be our center for design, flight test and manufacturing. We have exciting programs to work on, including the majority of the production for the 787. Our long-range business plan shows increasing airplane production across all of our product lines here in Puget Sound.

The 787 is an airplane that will improve the way airlines operate and people travel. The second assembly line for the 787 in Charleston will help us deliver more of these great airplanes to our customers who want and need them...JIM

UPDATE 5:05 PM: It's official:

Boeing to Place Second 787 Assembly Line in North Charleston, SC

SEATTLE, Oct. 28 /PRNewswire-FirstCall/ -- Boeing (NYSE: BA) today announced that it has chosen its North Charleston, S.C., facility as the location for a second final assembly site for the 787 Dreamliner program. Boeing evaluated criteria that were designed to find the final assembly location within the company that would best support the 787 business plan as the program increases production rates. In addition to serving as a location for final assembly of 787 Dreamliners, the facility also will have the capability to support the testing and delivery of the airplanes.

"Establishing a second 787 assembly line in Charleston will expand our production capability to meet the market demand for the airplane," said Jim Albaugh, president and CEO of Boeing Commercial Airplanes. "This decision allows us to continue building on the synergies we have established in South Carolina with Boeing Charleston and Global Aeronautica," he said, adding that this move will strengthen the company's competitiveness and sustainability and help it grow for the long term.

UPDATE 4:58 PM: The second 787 line will go to South Carolina, according to Snohomish Country Executive Aaron Reardon:

"The Boeing Company's announcement to locate a second 787 line in North Charleston, S.C., signals that other states want what we have - a strong manufacturing base. We must all work together and fight to keep it. Washington state must make a conscious decision to do whatever is reasonably necessary to aggressively compete to keep the jobs we have and grow our economy or risk more losses.

"The loss of the second line of the 787 will most certainly result in finger pointing. I urge all parties to resist that temptation as it is counterproductive and does nothing to further our objective to be the most competitive state in the country.

"What's important moving forward is that we all understand why these two parties could not reach an agreement so that we may play a role in rebuilding this relationship. In addition, we must bring all the necessary parties together in Olympia to reach agreement on removing the barriers that prevent new investment and job creation."

UPDATED 4:38 PM: Boeing says that a final decision on the 787 line has not yet been made and reports regarding employee meetings are "not true."

UPDATE 4:27 PM: Word from Boeing Charleston: Mandatory managers meeting now scheduled for 5PM ET.

4:11 PM: SPEEA's tweet just came across the 'tubes' and it reads:

Boeing calls emergency meeting for 787 employees in Everett.

According to SPEEA, the all-hands meeting was called at 12:30 PT and is apparently still underway right now.

SPEEA Executive Director Ray Goforth believes that it is connected the selection of a second 787 final assembly line.

I'm working all sources to find out more.

Anyone have more information? Prelude to a second line announcement?

As the clock passed midnight on the East Coast last night, the Seattle Times reported that negotiations between Boeing and the IAM had broken down, all but assuring that Charleston would take joint custody of Boeing's 787 final assembly operations.

An announcement, thought to be days - if not hours away, say program sources - will finally bring to a close the "will they, won't they" discussion. Boeing is set to make a decision that could represent not only an existential transformation in its nearly century-long history, but a seismic shift in the North American commercial aerospace industrial center of gravity.

The last time Boeing opened a new commercial final assembly operation, it was in Everett for the 747 in the late 1960s.

Not to mention, a second 787 line might be the biggest positive economic deal this country has seen after a recession that began just days after the IAM authorized its strike in September of last year.

South Carolina's silent treatment of the competition is quite telling in comparison to that of Washington state, which as a century-old hub of aerospace expertise has had to awkwardly justify its existence. Washington state, for all its logistical and technical advantages, couldn't override the one political roadblock that dominated Boeing's thinking.

The hushed tones of Charleston County Airport Authority meetings and the mystery economic incentives passed by the South Carolina State Senate finance committee only served to reinforce the "worst kept secret" approach to the Lowcountry's bid for the 787 line.

The $170 million economic incentive package, passed yesterday out of committee, would exempt manufacturers from the state fuel tax for test flights and transporting aircraft. The package known as Project Gemini, after the Zodiac symbol 'Twins', didn't name Boeing, but then again, it didn't have to.

The silence from Charleston, one senior executive says, is a quiet confidence created by a document known as the Master Charleston Campus Plan. Those who have seen it say it outlines a massive expansion of the Boeing Charleston site including a final assembly line, delivery center, flight line and paint hangars. The plan is so compelling that the US Senators who quietly visited Boeing Charleston earlier this fall, and the normally vocal Mayor of Charleston, have virtually remained silent on the matter.

The reality is that Charleston has not always been the front runner for the 787 line. In 2007 and 2008, Charleston, it appeared, could do no right. Cash-strapped Vought sharing responsibility with Alenia Aeronautica at Global Aeronautica was nothing short of a crippling bottleneck for the program. Poor workmanship, arbitrary processes and an unstable design and oversight by omission did nothing to untangle Boeing's ability to manage the program. Boeing would eventually be forced to purchase 50% of Global Aeronautica in March 2008. Charleston was the last place Boeing wanted to lay down its roots.

Yet, as Boeing began to come to grips with the management of its global supply chain, coupled with the cost of doing business in Charleston with partners with their own bottom line to bolster, Boeing began to see the existing arrangement as a losing proposition. Negotiating the incorporation of design changes was an expensive and time consuming process and financially unstable partners presented an unacceptable risk to the program.

By early summer, it had become clear that the ownership of Vought's aft fuselage fabrication and integration plant would change hands. There were at least some high-level indications that the announcement of the acquisition could have come as early as the Paris Air Show, but "emergent first flight issues", now known to be the side-of-body issue, took precedent.

When the deal was announced on July 7th, it represented the company's biggest commercial expansion since its merger 12 years earlier with McDonnell Douglas. Yet, what had been quiet speculation about the future of Charleston, Boeing's purchase of Vought's 787 operations amounted to a proverbial starting gun for the competition for the second line.

Late Summer brought the filing of permits for the Charleston line and the de-certification of the IAM at Boeing Charleston, the last of the major hurdles for Boeing's competition. Both events would set the stage for the secret negotiations between Boeing and the leadership of the IAM, which appear to have ended in stalemate. For now.

Washington state elected officials are now frantically working both sides, trying to bring Boeing and the IAM back to the table, while Boeing maintains that no final decision has been made on the location of the line.

In the words of Yogi Berra: "It ain't over till it's over.

Underlying the whole selection process is a shifting justification for the second line. As Boeing was accumulating orders at a stunning pace, the company entertained the idea of using a second assembly line to raise production rates to as high as 16 787s per month, beyond the 10 per month it had planned for the end of 2009. However, as the reality of the production troubles set in, the difficulty in ramping up made the second line imperative to get to the originally targeted 10 per month, now set for the end of 2013.

It cannot be far from Boeing's mind that the "assurance of delivery" their customers seek is as much about labor relations as it is about program execution.

When the final announcement is made, congratulations will be offered, fingers will be pointed and blame will invariably be cast. The decision is both the close of another chapter for the 787, and the beginning of an entirely new one. All of this comes before a single hour has been flown by the Dreamliner.

What's past is prologue

Been writing like a madman all day and came across this ad from Frontier Airlines on USAToday.com. They've used their animal-adorned Airbus tails in advertisements before, but I came across a new one and I thought it would be fun to share. This recession has gone on for over a year now with $11B to be lost by airlines, delays by Boeing and Airbus, and huge numbers of jobs lost. No doubt about it, 2009's been a rough one. Consider this a 60-second escape. I promise this will make you smile.

Continental Star Alliance
In a decidedly seismic shift in the airline alliance world, Continental has officially departed SkyTeam and joined up with Star Alliance. The move fills a long-time hole in the alliance around NYC. Continental and United opted against a formal merger in June 2008, instead creating a comprehensive link up agreement throughout their route network. Continental will introduce a Star Alliance logojet on a wingletted Boeing 757-200 (N14120) and will be unveiled today.

UAL Retires its 737s
United will fly its final 737-300 flight on Wednesday when it flies IAD-ORD-DEN-LAX-SFO as United Flight 737. The aircraft will spend some time at SFO for decomissioning then on to Victorville for a desert retirement. This aircraft is the last of 94 737-300s and -500s to leave United's fleet, leaving A320s, A319s and 757s as airline's narrowbody workhorses.

A380 for Air France
Air France will take delivery of its first of 12 A380s on Friday in a handover ceremony in Hamburg. The 538-seat superjumbo will fly its first commercial service between CDG and JFK on November 23rd. The airline is the fourth to take delivery of the A380 and the first in Europe. In addition, F-HPJA (MSN033) will be the first A380 delivered with the new Brake-to-Vacate (BTV) and Runway Overrun Warning & Prevention (ROW/ROP) systems that were certified by EASA yesterday. Flight's David Learmount was given an up-close demonstration of both systems last spring. His account of the new technology in action is well worth the read.

Sitting Still
Believe it or not, I'm actually on the ground for the next two and a half weeks or so, which is a long time for me. Next trip will be to the UAE for the Dubai Air Show. It'll be my first flight on Qatar Airways and it's going to be a long one! Twelve hours and 40 minutes after departing Dulles (777-300ER) I will arrive in Doha for a quick stop over, then on to Dubai (A321). When it's all said and done, it will take a full day (time zones included) to get to the Dubai Air Show from DC. A lot has changed since 2007, so needless to say, it's going to be an interesting show.

787 Goings On
Second production 787 (ZA101/#8) is now in the paint hangar making way for Dreamliner 12 to begin final assembly, just as soon as the aft fuselage arrives from Charleston. That section 47/48 certainly may have an interesting story to tell.

Lijit Search
You may have noticed the new search bar on the left side of the page. The new dynamic search is enabled by a sevice called Lijit that I was introduced to at BlogWorldExpo. Lijit takes the average blog search and expands it to the universe of content available beyond the blog. For example, Lijit will now search FlightBlogger, my Flickr feed, LinkedIn Profile, Twitter updates, Twitpic uploads and YouTube videos to provide the broadest possible results for your searches.

Searches will pop-up inside FlightBlogger and provide four tabs of results: 1) Results from the blog. 2) Results from extended content. 3) Results from sites in my blogroll. 4) Google results.

Boeing engineers have completed detailed design and computer validation of the final aspects of the 787 wing fix, the company says.

Boeing says the the final parts are currently being fabricated for the side of body modification that has kept the 787 grounded.

Once complete, the parts will be shipped to Everett installation aboard the static test airframe (ZY997) followed by full-scale validation. Installation is also currently progressing on ZA001 as well.

Boeing declined to say how long the final fittings would take to fabricate, but that they would be ready "soon".

Boeing CEO Jim McNerney said in last Wednesday's third quarter earnings call that the design and validation would be complete by week's end.

The company will continue subcomponent testing of the wing fix through the full-scale validation process, but adds that the data collected on the reinformcement so far has provided positive results.

Program sources tell FlightBlogger that Boeing engineers were troubleshooting detailed design issues with the four highest-load stringers at the aft of the wing as recently as ten days ago, but Boeing's detailed design completion appears to signal the design obstacles have been overcome.

The company has maintained that the first 787, ZA001, currently being modified inside Paint Hangar 45-04 is on track for first flight by the close of 2009.

A lot of people are asking how laptops could've caused the crew of Northwest Flight 188 to overfly MSP? According to the NTSB, using laptops on the flight deck is strictly prohibited during flight, but even a quick glance at the tray table on each side of the Airbus A320 family flight deck shows how a laptop monitor could easily block the pilot's navigation display.

The tray table is available to both crew members because Airbus uses a sidestick controller rather than the center yoke found on Boeing, Embraer and Bombardier aircraft. 

At NBAA 2008 (yes 2008), I was provided a tour of the Comlux A319 ACJ and unfortunately the audio on the video was largely garbled, so the video was never used. This afternoon, I went back and looked at one portion of the video that shows the arrangement of the flight deck tray table in relation to the navigation display. I added some new audio and some annotations on the video to show just how easily a laptop could block the displays, causing a major distraction to the crew. This is why laptops aren't allowed in flight!

Read the full text of the NTSB update on Northwest 188. Also, why was the ACARS off?

The first 787 Dreamliner to enter airline service with Japan's All Nippon Airways arrived on the Everett flight line late last week. The aircraft is currently buttoned up for storage while its flight test brethren are receiving the wing fix and will eventually be registered JA801A. Boeing has said the aircraft - ZA100 - will have a limited role in the flight test program to validate some weight saving structural changes. ZA100 entered final assembly in Everett in mid-June.

In addition, production standard 787s will not receive their engines for many months for two reasons. First, they are the most expensive single part of the aircraft and waiting to take delivery is good for the bottom line. Second, Boeing and Rolls-Royce are using ZA004 to test an upgraded version of the Trent 1000 to meet fuel burn targets before incorporating the changes into the production fleet. According to Boeing's latest schedule, delivery of JA801A, the seventh flying 787, is planned for late next year.

As you can see, only the tail is painted so far, begging the question: Is ANA getting a new and/or special livery for its first 787?

With all the discussion about getting 787 to fly, it is often forgotten that preparations have been well underway for years preparing the aircraft for airline service. However, as those preparations have stretched on two and a half years longer than expected, technology has continued to advance and changing trends inside the cabin have necessitated additional development to stay current.

My colleague, aircraft cabin connectivity expert, Mary Kirby, reports that Boeing is under pressure to select a connectivity solution for the 787.

"There is a lot of things that Boeing is trying to do to deliver it [the 787] on time but the overwhelming and loud feedback from the customer is 'you have to address this issue [in-flight connectivity] and you have to do it very quickly'," reveals David Bruner, vice-president, global communications services for Panasonic, which is supplying in-flight entertainment hardware for 787 customers in addition to Thales.

Boeing famously failed in its own attempt to create a sustainable business model for airborne high-speed Internet in the form of Ku-band satellite-based Connexion by Boeing, which was switched off in the commercial sector at the end of 2006.

With regard to the 787, Boeing confirms that it has not selected its in-flight connectivity solution. "We are in the process of an extensive trade study on this subject at this time," says a Boeing spokeswoman.

The airframer is exploring Ku offerings in addition to solutions that use Inmarsat's SwiftBroadband (SBB) aeronautical service over L-band satellites, according to IFEC industry players.

"I was amazed because I thought they'd say 'it's going to be two or three years and we'll look at it [connectivity] again', but they've rekindled the effort with us and other providers to ask - 'what is the right answer for this aircraft'," says Bruner.

In addition, some 787 customer have been invited back to the Dreamliner Gallery to see view new cabin offerings. Continental Airlines, for example, was invited back to Boeing to review its cabin selections, but says it made no changes to its plans for the 787s on order, says Brian Roland, engineering project manager for the airline.

No word yet on whether or not other airlines shifted their original choices for the cabins on their 787s. However, if you ask Mary Kirby, I'd bet she'd say that the connectivity selection could change this quite a bit.

This exchange came this morning at Boeing's Third Quarter 2009 earnings conference call:

Jon Ostrower:
Good morning. Questions for you about how we come back to hearing different things about [787 program] schedules, whether it is from on-line news media, or the financial community, and you then get these very confident declarations from you guys about the status of the program. Are you guys willing to stake your leadership on this? I'm trying to get a sense of where the buck stops after six delays here.

Jim McNerney:
Listen, we're all responding, I assume you're talking about the 787 program?

JO:
Yes, I am.

JM:
And the entire leadership of the Company plays a role in -- in getting this program done and out to our customers. It has been a difficult program. It has been technologically innovative, new to the world, in its characteristics, and we all wish that the program had gone more smoothly, and I think we all share responsibility in it not going as smoothly as we want but we're also going to share responsibility in its ultimate success when we get there. So we're a team going after this thing.

JO:
Thank you.

In its third quarter 2009 earnings call, Boeing CEO Jim McNerney reiterated that his company remains on track for 787 first flight, adding that engineers will complete and validate the detailed design for the side of body modification later this week.

Boeing will then move toward completion of the installations of the structural fittings on the side of body. Once complete, ZA001 will go repeat some gauntlet testing and taxi tests before flying.

When asked about the schedule and the pace of the design, McNerney replied, "The schedule changes every day, problems come up, we have to deal with them."

McNerney added that within those events, the schedule for 787 first flight remains on track for the close of 2009.

Boeing Reports Third-Quarter Financial Results
CHICAGO, Oct. 21 /PRNewswire-FirstCall/ --

• Third-quarter revenue was $16.7 billion, 9 percent higher than last year's strike-affected quarter
• Loss of $2.23 per share reflects $3.59 per share of expenses related to previously announced 787 cost reclassification and 747 charge, partially offset by solid performance in other commercial programs and the defense business
• Operating cash flow increased to $1.2 billion
• Backlog at $320 billion - nearly five times current annual revenues
• 2009 guidance updated for 787 cost reclassification and 747 charge
  

    Table 1.  Summary Financial Results
                           Third Quarter               Nine Months
                           -------------               -----------
    (Dollars in
     Millions, except
     per share data)        2009      2008  Change     2009     2008  Change
    -----------------       ----      ----             ----     ----

    Revenues             $16,688   $15,293       9% $50,344  $48,245       4%
    Earnings/(Loss) From
     Operations          ($2,151)   $1,147      NA     $403   $4,193      NA
    Operating Margin       (12.9%)     7.5%     NA      0.8%     8.7%     NA
    Net Income/(Loss)    ($1,564)     $695      NA      $44   $2,758      NA
    Earnings/(Loss)
     per Share            ($2.23)    $0.96      NA    $0.06    $3.76      NA
    Operating Cash Flow   $1,197     ($442)     NA   $2,391   $1,240      93%

The Boeing Company (NYSE: BA) reported a third-quarter net loss of $1.6 billion, or $2.23 per share, as revenues rose 9 percent to $16.7 billion. Current period results reflect the previously announced reclassification to research and development (R&D) of costs incurred through July for the first three 787 flight-test airplanes ($2.46 per share), spending on those planes for August and September ($0.14 per share), and the 747 charge ($0.99 per share), partially offset by solid performance in other commercial airplane programs and the company's defense business (Table 1). Last year's strike and supplier production problems reduced year-ago revenue by an estimated $2.1 billion and earnings by an estimated $0.60 per share.

ORLANDO -- Following in the footsteps of last week's 747-8I interior video, Boeing is featuring a 1:20 scale model of the 787 in VIP configuration here at NBAA. You may remember this very model from NBAA 2008 when I snapped a quick photo with my phone titled "Pimp My Dreamliner". The video sequel gets you MUCH closer to the meticulous detail built into the model. Enjoy!

The business aviation industry is not out of the woods just yet, but General Dynamics executive vice-president, Joe Lombardo, is cautiously optimistic about the prospects for the future.

"We're starting to see some favorable signs, I'm not going to tell you that we're back on the upswing necessarily, there are some early signs that we're starting to pull ourselves out of this," says Lombardo.

Lombardo adds that reduction in service activities, the loss of skilled jobs, global credit crunch, jet fuel prices, as well as the negative public perception of business aviation have taken their toll on the industry.

Yet, in the last two to three months, Lombardo says he has seen a demand growing internationally in emerging markets for the company's large cabin G550 aircraft.

Meanwhile, Gulfstream is pushing forward with its new twin airplane programs. The company's large-cabin G650 is progressing toward its maiden sortie and is currently running through safety of flight testing checkouts before moving into higher speed taxi tests at Gulfstream's Savannah, Georgia facility.

Pres Henne, Gulfstream senior vice-president of programs, engineering and test says that the G650 structural airframe is undergoing static testing, while the second test vehicle, designated T2, progresses through final assembly. Henne adds that T3 and P1, the first production G650, are already in the production system ahead of final assembly.

More than 6,300 miles away, Henne says that the super mid-size G250, which rolled out just days after the G650, is progressing at a similar pace to its large cabin sibling with safety of flight checkouts and static testing well underway in Tel Aviv, Israel.

Both aircraft are expected to fly by the close of 2009.

"When the 'I's are dotted and the 'T's are crossed," says Henne. "We'll be ready to fly,"

The first Airbus A330-200F, now fully painted, came out in the sunlight at Toulouse after departing the paint shop. The aircraft, registered F-WWYE (MSN1004), will head to the flight line toward the end of the month and will be handed over to flight test to begin ground testing ahead of its planned November 2009 maiden flight.

So you're probably asking, "What's up with that nose gear blister?"

From an April 8th article on flightglobal.com:

Images released by Airbus of the first A330-200F on the move in Toulouse reveal the modification made to the landing gear and forward fuselage to address the nose-down pitch that is a characteristic of the A330/A340 and provide a level cabin floor during loading.

This has been achieved by lowering the nose-gear leg attachment points to raise the nose height, in turn requiring a larger gear bay that is faired by a blister on the underside of the nose.

Photo Credit Airbus

NBAA 09: Embraer joins the '650' club
By John Croft

Embraer has revealed that it has successfully flown the first Legacy 650 large-cabin business jet, an upgraded version of its super-midsize Legacy 600. The launch brings to seven the total number of executive jets in the Brazilian airframer's portfolio.

"One thing our Legacy customers kept telling us is that the aircraft should have more range," says Claudio Camelier, Embraer's vice-president of market intelligence for executive jets. "The 650 is a response to that demand.

Embraer began delivering the Legacy 600, a derivative of the ERJ-135 regional jet, in 2002 and has produced more than 170 to date. Embraer considers the Legacy 600 to be a super-midsize category aircraft and the new 650 a large-cabin offering.

The company has two 650s flying in Brazil, one prototype and one pre-series version that flew within days of each other for the first time in late September, says Camelier. The flight test programme is scheduled for completion by mid-2010, with certification and service entry expected in the second half of 2010. The company launched the programme internally in first half of 2008, says Camelier.
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Follow @flightglobal and @flightblogger on Twitter for updates throughout #NBAA09

Boeing
This is going to be an interesting week coming up for Boeing. They've brought their BBJ Convertible to the show here in Orlando and are laying low with no announcements planned. However, the week will not be short on Boeing news with Wednesday's quarterly earnings call with CEO Jim McNerney and CFO James Bell. The company has promised an update on the 787 wing fix, which has been the subject of much discussion in recent days.

Hawker Beechcraft
The HBC 'military style' press conference kicked off media day this morning here in Orlando. The black flight suit clad executives struck a confident note as they expect the industry to rebound in late 2012 or late 2013. The company expects to see a "turbulent" 2010, but will have first flight of the Premier II in the first quarter of next year and the company will deliver its first e-enabled Hawker 750 and 900XP next year as well.

Embraer
Expect updates on the Phenom 300 flight test and Phenom 100 production, as well as news on development of the Legacy 450 and 500. Word on the street is that Embraer may announce something new this afternoon. Keep an eye out for big news from the Brazilian airframer around 1 PM.

Gulfstream
Gulfstream's pair of new business aircraft - G250 and G650 - are rapidly approaching their maiden flights. Program updates for both aircraft should be on tap from Gulfstream mid-morning Monday. Also, keep an ear our for what the company has to say about the perenially discussed vapor-based supersonic business jet.

Cessna
Needless to say, it's been a rough year for Cessna, with nearly a reduction in nearly 50% of its workforce and cancellation of the Cessna Columbus program. CEO Jack Pelton will be leading a press conference at 3pm and should provide an important indicator of the health of both the city of Wichita's aerospace cluster and the business jet industry as a whole.

Airbus
For the first time, Airbus will display an A318 Elite on the NBAA static display this week. The aircraft is the 10th Elite delivered as part of a total 25 orders won by Airbus for the type. Look for the European airframer to continue emphasizing VVIP retrofits for existing A330 and A340 passenger aircraft, which Airbus believes will begin coming out of service when the A350 comes online in 2013.

Bombardier
Like NBAA 2008, Bombardier is focusing on its new composite mid-size Learjet 85. The airplane was on less-than-solid ground last year after Grob folded, but the program is making progress and represents the only major new aircraft program currently on tap for Wichita's future. Bombardier will provide a program update on Tuesday afternoon.

While the installation of the 787 wing fix continues, Boeing engineers have returned to the drawing board to redesign part of the reinforcement, FlightBlogger has learned.

As a result, company and industry sources say the 2009 first flight target could be in jeopardy as engineers work to redesign the fix for four remaining wing stringers.

Boeing declined to discuss the modifications, saying that the next opportunity for an update will come on October 21st during the company's third quarter earnings call. However, the company did reaffirm that 787 "will fly by the end of the year."

Internal schedules, say several program sources, initially targeted October 15th for ZA001's to return to ground operations with a first flight to follow roughly six weeks later, however the aircraft remains in the paint hangar as engineers work to complete the design and installation of the side-of-body reinforcement.

The structures in question are stringers 2 through 5, the shortest and highest load stringers positioned in the aft of the wing boxes. Each wing box has 17 stringers designated 2-18.

Program sources indicate that the initial fix design for stringers 2-5 did not meet certification margins in computer modeling.

FAA certification requirements dictate that the wing must withstand 150% of the maximum load the aircraft will ever encounter in service. Industry and company sources say that the wing withstood around 105% before the stringer delamination was encountered in static testing, however Boeing has never publicly disclosed the number.

One source familiar with the wing fix says that the solution will remain consistent with what Boeing originally envisioned, but adds that the reinforcements could vary in length and/or location.

In a message to program staff on October 12th, 787 vice-president and general manager, Scott Fancher indicated that the progress on the installation is paced by engineering development.

Fancher said, "we are making headway on the [side-of-body] modifications. Great progress being made on engineering releases by the design team. This allows us to continue with the installation of fittings on the initial airplanes. The pace of the modification is increasing and I am confident that this integrated team will lead the way to first flight"

The company is working day and night to install the modification deep inside the center wingbox and wing structure of the 787 test fleet. 

Sources add that installation of the existing design is progressing well, with ZA002 and ZA004 rapidly catching up to ZA001 and ZY997 as the learning curve for the installation has already begun come down.

Once the installation is complete ZY997, the static test airframe will undergo full-scale testing of the reinforcement that Boeing hopes will validate the design, clearing the way for the 787 to fly.

Amid the almost unprecedented upcoming demand for flight test resources, Boeing plans to reduce its flight test unit by 200-300.

The cuts will impact the Flight Operations Test and Validation Team responsible for for laboratory and flight test operations, in support of validation and certification of Boeing commercial and defense products.

The reduction is part the the 4,500 cuts already announced by the company's commercial airplane unit, 10,000 company-wide.

Boeing announced the planned layoffs internally this summer, but the company says that 60-day layoff notices have yet to be distributed to the flight test unit.

Boeing says it is closely managing the reduction to avoid any disruption to the flight test schedules for the 747-8 or 787 programs, but emphasizes that it does not expect any disruption occur. The company says it will primarily focus the reductions on the overhead functions of the business, with the intent to limit staff cuts working directly with the aircraft.

The 200-300 cuts will come from the FOT&V team which currently employs 3,500 engineers, pilots, mechanics, and technicians, according to Boeing.

On December 18th, the FOT&V unit, formerly responsible for BCA flight test operations, will be consolidated into a single unit that will combine both commercial and defense flight testing into Test & Evaluations, which is part of Boeing's Engineering, Operations & Technology (EO&T) organization. The Test & Evaluations organization will employ roughly 8,000 following the consolidation.

In an October 8th message to 747-8 program employees, Dennis O'Donoghue, vice president of Boeing test & evaluation and Mo Yahyavi, 747 vice-president and general manager, de-coupled the 787 and 747-8 flight test programs citing the lack of available capacity at the company's Puget Sound airport locations to support the concurrent certification programs.

As a result, the 747-8 will conduct initial airworthiness testing at Moses Lake, Washington and then move to Palmdale, California for the remainder of the flight test program. The company adds that the of planning simultaneous flight test programs for the Boeing 787 and 747-8 has not caused the company to reconsider the decision to reduce FOT&V staffing.

Boeing has not run large-scale concurrent commercial flight test programs since 1982 when the 767 and 757 were being certified.

Boeing revamped its flight test methodology in 2008 to consolidate independent ad hoc units assigned to individual test aircraft to more effectively manage maintenance and support operations. The changes were initiated to support the flight test program for the 787, but was first put into operation in July 2008 with the 777F certification campaign.

Mr. al-Baker of Qatar Airways has become a human starting gun of sorts for industry discussion about re-engining the 737 and A320. His airline has been in (deadlocked) negotiations with Bombardier about the CSeries, while the prospect of such an order has provided Mr. al-Baker with a springboard to push the idea of a re-engined A320 as a potentially superior aircraft to the 120 to 149-seat CS300. Not to be out done, Boeing's Randy Tinseth is openly discussing the prospect of a re-engined 737, addressing it as technically possible, but with strategic considerations at the forefront.

Pratt & Whitney, widely believed to be a lead contender for the engine selection for the A320 and/or 737, has been actively pushing its PW1000G geared turbofan engine, which has already been through flight testing underneath the wing of an Airbus A340-600.

On the other end, the 100 to 125-seat CS100 has quietly prompted Embraer to evaluate exactly how the new narrowbody would stack up against its largest 100-seat E-195. Tucked away on page 32 of Air Insight's must read report on the future of commercial aerospace programs in Brazil, Canada, China and Japan and Russia, the Brazilian airframer delivered a noteworthy assessment of the CS100.

The real threat [to Embraer] comes from Bombardier. A proven competitor, Bombardier is taken seriously. However, Embraer points out that the CSeries wing is optimized for the larger CS300. That means the CS100 has a larger wing than needed, and as a result the CS100 will weigh ~5,000kg more than its E-195. Even with the [Pratt & Whitney PW1000G] geared fan, Embraer expects to see the CS100 only offer a 2% fuel burn advantage over the E‐195. Given that the CS100 is a new design with a program settling‐in period, Embraer believes it has some time before it needs to react to the new competition. Emphasis Added

Boeing and Airbus always promised a robust response to CSeries. Their turf is well established and with the prospect of a significant loss of market share (read: cash flow) Boeing and Airbus will fight new entrants tooth and nail. For Embraer, their assessment leaves the door open to significant changes to the E-Jet family. Would a next generation E-Jet leap frog a CS100 in the 100-seat segment? No matter how you fold it, CSeries represents a competitive threat to Embraer, Boeing and Airbus and we've only just begun to see the response.

Well, here it is! JetBlue A320 (N561JB) was unveiled this evening in Orlando with a new tail design called 'Blueberries' and larger titles on the side of the aircraft? What do you think?

It's a sensational headline I know, but the juxtaposition of two news stories published within minutes of each other caught my attention. CEO of Qatar Airways, Akbar al-Baker said that all is well with Boeing and his company's 787 order, while telling Bloomberg that in regards to an order for CSeries:

Discussions hinge on "a few figures" and Qatar Air won't buy the plane unless its conditions are met, Chief Executive Officer Akbar al-Baker said today in an interview.
    Airbus SAS could effectively kill off the CSeries by offering a version of its own shorthaul family of aircraft with the same geared-fan technology, he said. Qatar Airways already operates a fleet of Airbus A320 narrowbodies.

Al-Baker's very public negotiations on aircraft orders have worked before, and it sounds like the potential for the order has come out of the freezer to thaw.

New JetBlue Livery
Rumor has it that the airline is about to unveil a new livery for its fleet to celebrate its 10th birthday. I can't believe the airline is 10 years old already! I'm sure I still have my copy of Airways Magazine lying around somewhere with their first A320 on the cover. How time flies!

Blog World Expo
The 30,000 mile quest continues, as I find my way to Sin City this Wednesday for 2009 Blog World Expo. Nothing directly aviation related there, but it's a great chance to see some of the emerging technologies that will help enhance Flightglobal's industry coverage online. After finding Apture last year, I'm a true believer.

From Vegas I'll be flying directly to Orlando for...

NBAA
Perhaps no one subject in the aerospace industry has generated more world wide discussion more than business aviation over the last year of the global recession. Starting on Saturday, I'll be in Orlando for the National Business Aviation Association conference. It will be packed full of BizAv events, interviews and plenty of news. A small band of rebels (AKA Flight journalists) will be covering the event top to bottom. It should make for an interesting opportunity to assess the state of US and global business aviation.

Kelly Johnson's 14 Rules
A veteran aerospace engineer suggested I post Clarence 'Kelly' Johnson's 14 Rules of aerospace project management. They were originally intended for SkunkWorks projects and were created in 1943 with the XP-80 program. They still hold true for aerospace today...even on the commercial side.

1. The Skunk Works manager must be delegated practically complete control of his program in all aspects. He should report to a division president or higher.
2. Strong but small project offices must be provided both by the military and industry.
3. The number of people having any connection with the project must be restricted in an almost vicious manner. Use a small number of good people (10% to 25% compared to the so-called normal systems).
4. A very simple drawing and drawing release system with great flexibility for making changes must be provided.
5. There must be a minimum number of reports required, but important work must be recorded thoroughly.
6. There must be a monthly cost review covering not only what has been spent and committed but also projected costs to the conclusion of the program. Don't have the books 90 days late, and don't surprise the customer with sudden overruns.
7. The contractor must be delegated and must assume more than normal responsibility to get good vendor bids for subcontract on the project. Commercial bid procedures are very often better than military ones.
8. The inspection system as currently used by the Skunk Works, which has been approved by both the Air Force and Navy, meets the intent of existing military requirements and should be used on new projects. Push more basic inspection responsibility back to subcontractors and vendors. Don't duplicate so much inspection.
9. The contractor must be delegated the authority to test his final product in flight. He can and must test it in the initial stages. If he doesn't, he rapidly loses his competency to design other vehicles.
10. The specifications applying to the hardware must be agreed to well in advance of contracting. The Skunk Works practice of having a specification section stating clearly which important military specification items will not knowingly be complied with and reasons therefore is highly recommended.
11. Funding a program must be timely so that the contractor doesn't have to keep running to the bank to support government projects.
12. There must be mutual trust between the military project organization and the contractor with very close cooperation and liaison on a day-to-day basis. This cuts down misunderstanding and correspondence to an absolute minimum.
13. Access by outsiders to the project and its personnel must be strictly controlled by appropriate security measures.
14. Because only a few people will be used in engineering and most other areas, ways must be provided to reward good performance by pay not based on the number of personnel supervised.

One very large visitor to WAEA this week in Palm Springs was a model of a Boeing 747-8 Intercontinental. Like the A350 XWB model at Paris, Boeing built a cutaway miniature cabin mock-up of its jumbo jet.

The lower deck features a three-class configuration of first class suites, herringbone arranged business class lie-flat seats, and 10-abreast economy class.

The upperdeck features a lounge area with couches and additional business class seating. Now that you've seen the miniature version, take a look at the full size mock-up at Boeing's Customer Experience Center.

The never ending battle between Boeing and Airbus to claim the title of worlds biggest aircraft maker got a little bit tighter this week.

Through the third quarter of 2009, Airbus says it had delivered 358 planes to Boeing's 359. Each company says it plans to deliver between 480 and 485 aircraft this year.

While the rest of the civil market has taken a major production beating, especially on the business jet side, the commercial market has remained strong. There are more than a few people who are of the mind that 2009 deliveries are a significantly lagging indicator to the true state of the marketplace. Any pronouncement that Boeing and Airbus have weathered the storm of the global recession in production terms is a bit premature.

Suppliers to Boeing and Airbus are of the mind that production has to slow, with 737 and A320 rates likely to fall in 2010 or 2011.

Each company says that it has no plans to cut rate due to back-filling of orders to compensate for deferrals, but with the backlogs barely growing compared to previous years, back-filling is only viable for so long.

On the Boeing side, one needs only to look at history to see how the company works within the cycle. Without fail for the last half century, Boeing has announced a significant production cut on years ending in zero ±1 year. To quote Mark Twain: "History doesn't repeat itself - at best it sometimes rhymes"

Yesterday's announcement of a fresh delay to Boeing's 747-8 Freighter program wasn't triggered by a single large event but rather the accumulation of small issues that added up to an additional three month slip in first delivery to Cargolux to the fourth quarter of 2010.

"It is more akin to death by a thousand cuts," says one program engineer of the latest delay.

At its heart, the delay was attributable to resource constraints driven by the engineering responsibilities diverted by the 787 program.

"Consequently", the engineer says, "more engineering errors escaped than what could be considered normal."

For example, the leading edge Krueger flaps had to be reworked because they weren't fairing properly.

For those on the assembly floor, "workers are adjusting to building a new airplane. A lot of them have been moved around...so their work lacks continuity which leads to production errors," says the engineer.

747 vice-president and general manager Mohammad 'Mo' Yahyavi said in May, "I have all the resources I need now for both the freighter and the Intercontinental."

Program executives addressed this central question about resource allocation for the 747-8 after the 787 was grounded in late June for the side-of-body fix:

"The 787 will identify the requirements they need to address their challenges, but that won't have an impact on the 747," Todd Zarfos, the vice president of engineering for the jumbo-jet program, said in an interview today. "Over the last two years we've aligned our engineering resource ability to make sure we meet all our commitments."

Despite the planning that was put into effect to avoid such a repeat of previous resource starvation, the 747 again fell victim to the engineering demand of the 787.

747-8I launch customer Lufthansa, whose passenger variant entry into service remains unchanged, expected that a further program delay would result because of the 787 resource shift.

Lufthansa CFO Stephan Gemkow was quoted on June 25th as saying:

"I'm sure again the delay of the 787 will mean that they have to pull in more engineering resources, and that will have even further delays, as a consequence, for the 747-8. I would not be surprised to learn this some weeks or months in the future."

Prior to yesterday's announcement, RC501, was set to leave the 747 final assembly line for the paint hangar around October 11th, with first flight planned for December 9th.

Of the total number of tasks required to build a 747-8 from structural build up all the way to pre-flight activities, just over 50% had been fully completed at the time the delay was announced, according to company sources.

Of the balance of tasks or "jobs" that have yet to be completed or "sold" many remain "open" or partially completed, paced by engineering changes. As a result, the total level of completion was far above 50%, but the open and unfinished jobs created a critical path bottleneck that has to be overcome before moving forward.

CATIA and the IRON BIRD

Boeing decided against a full systems integration lab (SIL) for the 747-8 derivative aircraft, due to the influence of the legacy systems on the current design. However, because a SIL was unavailable, says a second 747-8 program engineer, many of the system level issues were encountered on the aircraft, rather than being caught in the lab.

In addition, without a universal computer model derived from Dassault Systemes CATIA v5 software, Boeing has found itself "trying to bridge the gap between 1969 and 2009," says a veteran engineer based at one of Boeing's 747-8 suppliers.

For example, the new wing design and enlarged empennage were designed through CATIA v5, while a portion of of the internal fuselage structure and other parts of the aircraft were built using legacy engineering drawings. 

Some parts and their associated engineering drawings, the engineer says, have not changed since the 747-100, which in some instances has led to a loss of tolerance control in some areas.

Any gaps in the structure are typically addressed with structural shims to align and help parts fit together. However, as the resources have been stretched so thin, the engineering for those shims has been slow to take hold, say the engineers.

"The scope of this delay doesn't compare to what the 787 has been going through, but it is still disappointing," says the first engineer. "Boeing and its employees so desperately need something to celebrate right now."

Photo Credit Boeing (mid)

PALM SPRINGS -- In-flight connectivity provider Row 44 announced a new tool for airlines to generate ancillary revenue by providing free access to a sponsored IFE portal to passengers with laptops and other devices.

The portal, known as a "walled-garden", will provide access to a selected set of services like retail shopping, live television viewing, games, and information on the destination city, even allowing passenger to book ground-based service and events prior to landing.

Row 44 has created a coalition of partners along with SkyMall to offer in-flight catalog access, JiWire to offer advertising inside the portal, BeDynamic providing destination event booking and Pinger offering a premium for unlimited SMS messaging while in-flight.

Lastly, but perhaps most notably, the Home Shopping Network (HSN) has signed on as well. At first glace the channel selection may not seem that important, but through the Ku-band satellite link up Row 44 will offer a live streaming simulcast of the HSN channel with options to purchase items directly inside the free portal.

Whether your inclination towards HSN leans one way or another, try think about it this way: The demonstration of live streaming video through a walled portal to a laptop could pave the way for passengers to bring their own integrated IFE onboard. Bringing your iPhone, laptop, DVD player, etc already is BYOIFE, but imagine that the device you bring on board allows access to a portal designed to optimize your user experience, not to mention the potential for regulating potentially expensive bandwidth.

Row 44 says the new portal will be flying by the 1st of November. The company declined to say which airline would be the launch customer, however Southwest Airlines and Alaska Airlines are the only current operators for the service.

Which brings me to my next thought: Electronic Flight Bags. EFBs are purely a pilot tool and are divided into three classes. A Class 1 EFB is an external device that is brought aboard must be stowed at certain phases of flight. A Class 2 EFB is similar to a Class 1 except it can be used during all phases of flight. A Class 3 EFB is a fully integrated platform that offers two way systems communication and is permanently installed aboard an aircraft as an LRU.

So what does this have to do with IFE? I'm taking some creative liberties on classification, but if we follow these similar conventions then:

• Class 1 IFE is your unconnected laptop, iPod, iPhone, that is able to make a direct connection to the internet, but in an unguided way.
• Class 2 IFE is the device you bring on board that is able to interface with the walled garden or internet at-large to provide access to free and premium content by way of a connected environment.
• Class 3 IFE is your fully integrated seat-back unit.

What Row 44 has done here is give life to the Class 2 IFE, while at the same time relieving the burden of maintenance and installation of individual seat-back LRUs, while removing the cumbersome need to download new media to the aircraft. Pardon the pun, but could cloud computing be the answer to a new airline business model?

This newly announced delay, FlightBlogger has learned, comes as part of a comprehensive status review of Boeing's commercial programs conducted by newly installed commercial airplanes chief, Jim Albaugh. In addition, program sources indicate the level of completion of tasks on the 747-8F required ahead of first flight stand at just 50%.

Boeing to Recognize Third-Quarter Charge for the 747 Program
CHICAGO, Oct. 6 /PRNewswire-FirstCall/ -- The Boeing Company (NYSE: BA) today said it expects a pre-tax charge against third-quarter results of approximately $1.0 billion due to increased production costs and the difficult market conditions affecting its 747-8 program.

Approximately $640 million of the charge reflects higher estimated costs to produce 747-8 airplanes at both Boeing and supplier facilities. As the program assembled major components of initial 747-8 Freighters during the third quarter, it became clear that late maturity of engineering designs has caused greater than expected re-work and disruption in manufacturing. This is resulting in additional resources being applied on the program and higher supplier expenses, which are the primary cost drivers.

The remaining $360 million of the charge relates to challenging market conditions and the company's decision to maintain the 747-8 production rate at 1.5 airplanes per month nearly two years longer than previously planned, deferring an increase to 2 per month. Higher allocation of fixed expenses and volume-based penalties to suppliers are the main drivers of the additional costs.

Because the 747 program is in a loss position, costs associated with the factors above will be immediately recorded in the third quarter for future 747-8 deliveries.

The company now expects first flight of the 747-8 Freighter to occur by early next year with the flight test program taking place in 2010. First delivery of the 747-8 Freighter is now expected in the fourth quarter of 2010. First delivery of the Intercontinental passenger variant remains scheduled for the fourth quarter of 2011.

This is a breaking story and will be updated.

Late Monday afternoon, Mary Kirby and I were given an exclusive look at Panasonic's new integrated IFE seat design called the Fusion. The change could represent a major shift in how airlines leverage IFE for economy class cabins.

The new slim seat design, which was covered with a blanket when Mary and I first arrived at Panasonic's still under construction stand, was shown to us installed on the Weber 5751 economy class seat. Panasonic has gone to great lengths to create a new integrated interface between the IFE screen and the seatback, with new design that introduces a clearer new capacitive LCD screen.

The touchscreen LCD will come in seven or nine inch options, and a USB power port will be a standard feature. Panasonic envisions a fully connected IFE seat-back interface that accomodates in-flight access to social media sites like Twitter and Facebook.

While Panasonic says that they have yet to sign a customer for the new seat and IFE system, the company says it is working closely with airframers like Bombardier to offer the Fusion system as part of the CSeries cabin. Panasonic is already supplying the cabin mangement system for the CSeries.

"We look at CSeries as a great opportunity," says Paul Margis, CEO of Panasonic Avionics.

Panasonic says that the Fusion system is designed for both narrowbody and widebody applications. Each system weighs about 1.5 lbs, compared to the current system which weighs about twice that.

The 50% weight cut could yield significant long-term fuel burn savings when spread across aircraft economy cabins like that of Qatar Airways 777-300ER which seats 293 or the Emirates A380 which seats 399.

Panasonic hopes to have the Fusion flying by November of 2010.

PALM SPRINGS -- Continental Airlines is set to introduce its first newly configured Boeing 777-200ER with its BusinessFirst flat-bed seat by the end of October.

Brian Roland, engineering project manager for Continental Airlines, says 777 Ship 13 (N78013), which is currently being modfied, will be the first to feature the new 50-seat business class cabin.

Each BusinessFirst seat will feature a Panasonic designed eXport jack, allowing passengers to play content stored on Apple iPods and iPhones on the seat back screen.

Panasonic announced today at the World Airline Entertainment Association Conference and Exposition that it is partnering with Apple accessory maker Griffin to offer the eXport in-flight video cable in retail stores. Previously, the Panasonic cable was only available to passengers as property of the airlines.

In addition to Continental, Panasonic has secured about a dozen customers for the eXport jack system, including Singapore Airlines, Avianca, Swiss International Airlines and United Airlines.

The seat, which is made by B/E Aerospace, features a full 180-degree, 6'6" (198.1 cm) lie-flat seat, as well as Panasonic IFE system with hand controller and US compatible power plug.

The airline also plans to feature introduce the flat-bed seat on its Boeing 787 aircraft, along with its existing 767-400ER, 767-200 and 757-200 fleets.

The installation of the new seats on the 777-200ER fleet is expected to be completed by August 2011, with the existing fleet a year later.

Continental operates a fleet of 20 777s and holds orders for an additional eight.

Photo Credit Continental Airlines (top)

Last of three flights today to Palm Springs for the World Airline
Entertainment Association conference. Routing took me through Denver
and Los Angeles aboard United Airlines 757-200s (N520UA & N553UA).
Final leg is onboard SkyWest Embraer EMB-120 Brasilia (N235SW). With
all my traveling over the last two years, this will be my very first
trip to California, unless you count a 2003 spotting excursion to In &
Out burger at LAX.

Stealing a page directly from Cranky Flier's playbook, I've decided to conclude each week with links articles I've written and other content posted outside of FlightBlogger.

G650 rolled out in upbeat Savannah ceremony - Flightglobal
After a year economic downturn and bad publicity endured by the corporate aviation community, Gulfstream took a moment to celebrate with the roll-out of its new large-cabin G650 business jet.

Embraer set to unveil Phenom 300 maintenance datalink - Flightglobal
Embraer is set to announce a datalink for its new Phenom 300 aircraft that will link the light jet's central maintenance computer (CMC) to aircraft service centres.

Boeing revamps 787 wiring, begins structural modifications - Flightglobal
Boeing will introduce a new wiring standard for the 787 to reduce weight, improve maintainability and address a spacing issue between wires, says key supplier Spirit AeroSystems.

New Photos
Also, see my Flickr photostream for the most recently uploaded photos. New additions include G650 photos and some panorama shots from the Udvar-Hazy Center. Make sure to check out the extremely belated posting of photos from EBACE and the May ZA001 roll-out.

In a move that could reshape the US regional jet landscape, feeder carrier Trans States Airlines signed an LOI for up to 100 MRJ aircraft.

The order includes 50 firm aircraft and 50 options and is one of the biggest in a year that has seen few large orders, especially from US carriers.

Trans States currently operates a fleet of ERJ-145 and CRJ700 (subsidiary GoJet) aircraft for US Airways Express and United Express.

The introduction of the MRJ to US regional feeder routes adds a fifth major player in the North American commercial jet transport market along side Boeing, Airbus, Embraer and Bombardier. In particular, the MRJ takes direct aim at the market currently occupied by Bombardier's CRJ700 and CRJ900 aircraft, as well as Embraer's E-Jet family.

The significance of this order is not to be underestimated. A Japanese aircraft breaking into the US regional market could be on par with the 1986 order by Northwest Airlines and the 1996 order by United Airlines for A320 family aircraft, opening the door to a flood of new operators.

The order also represents the US commercial launch of the Pratt & Whitney PW1000G turbofan, as well as the Rockwell Collins Pro Line Fusion avionics platform.

Delivery dates have not yet been set, however the MRJ plans to enter service in 2014 with launch customer ANA. Trans States did not specify a breakdown of selected variants, but have said they are interested in the 92-seat MRJ90, the 78-seat MRJ70, and the proposed stretched variant of the aircraft with 100 seats.

The order comes three weeks after Mitubishi unveiled major changes to the MRJ design including shifting the wing from composite to aluminum.

"Conceptually, this is a very big change," admits Mitsubishi Aircraft. "Structural changes are easier and require shorter lead-time with aluminium wings. With an aluminium wing box, the wing structure can be more easily optimised for the MRJ70/90 and the stretch model, which enhances the overall competitiveness of the MRJ family."

The change will allow its engineers to develop an optimum wing for the MRJ90 and minimise the deterioration of range performance for the stretched version. The biggest benefit will be for the MRJ70, which will weigh less.

"This will allow weight reduction through structural changes, allowing for larger winglets and resulting in a reduction of block fuel [consumption] and take-off performance improvement," says Mitsubishi.

As a result, Mitsubishi has thickened the now-aluminum wing of the MRJ resulting in a 27 knot decrease in cruise speed while seeking to maintain the aircrafts planned fuel burn advantage over today's regional jets.