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View Diary: Excessive outsourcing probably added 140% - 260% to Boeing's 787 launch costs (260 comments)

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  •  Those DC-10s were so great, eh? (7+ / 0-)

    The last major commercial airliner that Douglas developed.  All outsourced.  A disaster for the company, and miserable to ride in.

    Those who donlt learn from history....

    •  Do you have any references for this? (3+ / 0-)
      Recommended by:
      xynz, SyntaxFeline, My Spin

      The DC-10 had it's share of problems early on, but I haven't been able to find anything about it's design and development being heavily outsourced.

      Douglas was having all kinds of DC-8 and -9 production problems at the time, which necessitated it merging with McDonnell in the first place.

      Hopelessly pedantic since 1963.

      by admiralh on Mon Feb 07, 2011 at 03:10:38 PM PST

      [ Parent ]

      •  The paper linked and references therein (7+ / 0-)

        I don't have access to those texts (conference proceedings) - but it would seem likely that those references and the original paper are best place to start.


        1. L. J. Hart-Smith, "Interface Control – The Secret to Making DFMA® Succeed",

        McDonnell Douglas Paper No. MDC 96K0132, presented at SAE Aerospace Manufacturing Technology
        Conference & Expo, Seattle, June 2-5, 1997, and published in Proceedings, pp. 1-10, SAE Paper No. 972191.

        1. L. J. Hart-Smith, "On the Adverse Consequences of Cost-Performance Metrics Usurping the Role of Goals They Were Supposed to Support",

        McDonnell Douglas Paper MDC 97K0068,
        presented to 21st Congress of the International Council of the Aerospace Sciences,
        Melbourne, Australia, September 13-18, 1998, and published in Proceedings. Also available
        on the Boeing MR&D Web-Site for BCA in Seattle.

        1. L. J. Hart-Smith, "Design for Assembly (DFA) – The Key to Making Parts-Count Reduction Profitable",

        McDonnell Douglas Paper No. MDC 98K0071, presented at SAE Aerospace
        Manufacturing Technology Conference & Expo, Long Beach, June 2-4, 1998, published as
        1999 SAE Paper No. 99-01-2281 in association with June 8-10, 2000 SAE presentation in
        Seattle; "Cost-Saving Opportunities Often Overlooked Due to a Pre-Occupation with
        Affordability Initiatives"

        SAE, in Warrendale, PA may have copies of the highlighted papers available for a modest fee.

    •  Boeing Timeline... (21+ / 0-)

      This was 2009:

      Will Boeing move to Beijing?

      Boeing (BA) CEO Jim McNerney is eager to move the company to China. Whether moving Boeing to China means shifting its headquarters from Chicago to Beijing is up in the air.


      Sorscher told me that McNerney recently hosted a meeting with a group of engineers to discuss how Boeing should build its next aircraft. The conclusion of the meeting was that McNerney is comfortable with the way the 787 was developed but thinks it could use a bit of tweaking -- and he'd like to shift more of the design and manufacturing of future Boeing aircraft to China.

      This would leave Boeing as a systems integrator which outsources product development to China and other countries. According to Sorscher, the engineers were very nervous in their presentation -- perhaps fearing that they would be punished for bringing McNerney the bad news that they believed Boeing should never repeat what it has done in the design and manufacturing of the 787. The engineers reportedly believe that in the future Boeing should take far greater authority and responsibility for aircraft design.

      According to Sorscher, McNerney wants to partner with China rather than compete. He likes the idea of outsourcing the design and manufacturing of future aircraft there and -- with some minor tweaks -- is comfortable with shifting future aircraft design and manufacturing work to suppliers as Boeing did with the 787.

      This was 2010:

      China Plans Commercial Jet, Challenger to Boeing and Airbus

      It’s been a tough couple of weeks for the world’s two premier builders of large commercial jets. An Airbus A380, the new crown jewel in Airbus’s fleet, suffered an engine explosion after taking off from Singapore earlier this month, forcing a harrowing emergency landing. Then a test-flight of Boeing’s 787 Dreamliner had to make an emergency landing after smoke filled the passenger cabin. But if the Big Two thought things couldn’t get any worse, they were wrong: China today unveiled the first full-sized models of its own large jetliner, the C919, a 156-seat passenger aircraft that will go toe-to-toe with Boeing and Airbus’s offerings by 2016.

      Gee... that seems to be working out just swell for Boeing and as part of their agreements with China for the mandatory transfer of technology for building there... they should be out of business in no time!

      •  You nailed that one (13+ / 0-)

        The short term thinking by overpaid members  of the C-Suite membership only club will ultimately be the death of this country. Once you have outsourced  design,development, production, customer service, accounting and IT, you pretty much have left a shell of a company for shareholders. A company that is totally vulnerable to the whims of the host country they have outsourced too. The knee slapping hilarity that keeps Chinese comics working 7 days a week is they don't save a dime of money and they hand all their R&D over for FREEEE".

        The tragedy is good paying jobs are disappearing about as fast as industry. I don't think these people realize it, but if we ever get to a guillotine/"let them eat cake" stage, they will be the first ones frog marched out of their Multi-Million dollar personal offices.

        One also has to consider the mind numbing ignorance of the upper 1% and 0.1%. They believe money confers leadership rights, decision making rights, and the infallible right to decide how the country is run which means run for their personal benefit.

        Their egos are so large they will not accept they are wrong until the first day China offers the 787 Plus's at 15% of the cost Boeing was charging. "First Solar powered Hybrid airliner, operating costs are 5% of Boeing"

        "Boeing reports 100% cancellations on it's 787 orders today as the stock is slammed by 70%. Airlines are reportedly demanding  not only full refunds for the 30 Units they did ship, but training costs for the crew and the wasted jet fuel. The National Association for Airline Rights, a newly formed legal group is getting ready for the battle of the century."

        "Partners?" Famous last words in China. A homogeneous society whose leadership looks at those round eyes with nothing but suspicion and disdain.

        Airlines desperate for profit, will snap them up since fuel prices keep breaking the bottom line. Even then the stated excuse from the CEO will be "The board wouldn't allow me to put the necessary safeguards in as they were concerned about expense". Only thing is, the board member are fellow CEOs that the dipshit CEO  appointed who agrees with everything Dipshit says so they can get on the greens.

        I really hope this "say on Pay", gets some traction. Maybe it will evolve into "Say on Employment", as in "You're fired MF". The Chinese are stealing iPads and iPhones, American made cars, airplanes and even the mighty Microsoft fell to the reality of piracy there when they started selling a Microsoft Disc with all Microsoft's products which can easily run $150,000 in the states for all of $3.00 in China where they pick up exactly 1 Billion in revenue minus the costs of packaging and translation of the dialogs and menus to Chinese. Not an easy task and not insubstantial costs involved.  

        They don't get the connection that without a strong middle class that we won't be able to subsidize those sales anymore? No. It never occurs to them. You wanted thinking with those billions? Hah.

        The only reason China spends 10% of what we do on defense is a direct result of only 10% of our new technology is worth copying. I wonder if they get frustrated and scream, "why not a higher caliber round you dumb Amelicans."

        "How can we complain when when you hand it to us for free or for a vacation home in North Carolina?" Other PRC Officers laughing themselves Hoarse.
        "North ah ah much?"
        1000s of PRC army officers rolling on the floor laughing.

        Good God, it's bad enough that we have lost our economic base, but to have your competitors laugh at you for being mind numbing dumb, is just too much to take.

        "Jump You Fuckers"  

        •  though with respect to the iPad (0+ / 0-)

          There's not much worth stealing with respect to hardware design.

          Any company that can make a netbook (a form factor that originated from Asia) can make a tablet PC. Ask ASUS.

          I've owned a generic Android tablet for quite some time, it was built at one of the Chinese assembly houses, versions are probably in the US under various US brand names, I bought mine direct from a small Chinese retailer.

          Looking for intelligent energy policy alternatives? Try here.

          by alizard on Tue Feb 08, 2011 at 02:36:39 AM PST

          [ Parent ]

    •  You're forgetting the MD-11 (11+ / 0-)

      The MD-11 is the real problem child - the DC-10 had some teething problems, sure, notably with a bad cargo door latching design that could indicate it was locked when it in fact was not - and it took two DC-10s bursting open, one with the loss of over 300 lives, before they fixed the problem.

      The MD-11 came on the scene in the early 90s as sort of a DC-10 "Advanced" - Take a DC-10, put a modern flight deck with electronic gizmos on it, stretch it, new engines, slightly modified wing and tailplane design - and you've got yourself a dog that failed to meet every single performance guarantee it promised, and shed over half its orders before the plane even flew.

      The MD-11 also has a marked tendency to be tricky to land in crosswinds, owing to an inadequately sized tail (too small), resulting in the loss of 8 frames (of 198 total built - that's a horrible loss ratio for any commercial jet).

      Such was a failure that McD had to sell itself to Boeing... and then the McD management took over, and we see the result.

      •  Well, McDonnell could have soldiered on ... (5+ / 0-)

        with the military business alone, but they had disastrous management decisions on that side as well.

        The A-12 debacle was the beginning. What the wikipedia article fails to mention us that there was a review of all four major aircraft development projects in mid-1990, with the thought that the worst off project might be canceled. McDonnell and General Dynamics management lied through their teeth to say how on-time the project was, and so passed the review.

        Only a few weeks later, they started to reveal to the Navy just how behind schedule the project was, leading to its eventual cancellation.

        After this, I believe that the Defense Department lost all trust in McDonnell management. They never won another airplane contract.

        Hopelessly pedantic since 1963.

        by admiralh on Mon Feb 07, 2011 at 10:33:07 PM PST

        [ Parent ]

    •  RE DC-10's: a friend of mine at Continental used (1+ / 0-)
      Recommended by:

      to refer to the 10's as Hangar Queens because they so often needed repairs. Dispatch reliability was horrible.

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