Boeing HQ
Today’s key stories focus on changes at Boeing. The portfolio of the Global Services division could change with the potential sale of Jeppesen. While no decision has yet been taken, Jeppesen is very profitable, with revenues of about $400k per employee. While this asset would be quite valuable, the question is how well it integrates with Boeing’s new strategy to focus on its core – building aircraft.
In management changes, 33 year Boeing veteran Elizabeth Lund, a VP and head of quality at Commercial Airplanes, is retiring. She was given the quality portfolio after the door blowout earlier this year, and violated NTSB protocols by publicly disclosing information on an investigation in progress, cutting off Boeing from full participation in that process. She also faced contentious Congressional hearings on quality and safety earlier this year.
Anticipation of further changes to middle management is awaiting furlough notices for 17,000 employees later this week as Boeing cuts its staff. The uncertainty of who will stay and who will go is rife within the company rumor mill.
Rolls-Royce has a problem with too few spare parts to repair problematic Trent 1000 engines used on the 787 Dreamliner. Both British Airways and Virgin Atlantic have cut cities from their summer route structure, and BA has opted for GE engines over the British-made Rolls Royce for future Dreamliner acquisitions. That’s a drastic move for a British company, as Rolls-Royce invests in maintenance and repair facilities to provide short-term surge capacity. Unfortunately, capacity will arrive too late for some airlines, who will seek compensation from the company for cancelled flights and revenue losses.
Finally, rebuilding the supply chain after the strike will not take a uniform approach, as some suppliers are in better shape than others to resume deliveries. It is clear, however, that Boeing will not immediately return to the low-20s 737 MAX production rates of this year until the first half of next year, and will be hard pressed to reach the FAA limit of 38 per month until late 2025 at the earliest.
Links to todays key new follow:
- Will Boeing add Jeppesen to asset-sale plans? – AIN
- Boeing’s head of quality for commercial planes Elizabeth Lund is retiring – Seattle Times
- Uncertainty looms as Boeing prepares to issue layoff notices to 17k workers this week – CBS Austin
- Rolls-Royce moves to placate airlines with Trent 1000 task force – BNN Bloomberg
- Boeing’s path forward: rebuilding supply chain after strike – Supply Chain World
Views: 4
