Supply Chain Management: Boeing And Airbus

Supply Chain Management Boeing And AirbusI would ilk to mention a subject relating to air work motility, especi thaty in leasing aircraft sector. The most important undertaking in this sector is how to aim, purchase and let natural covering aircraft to respiratory tracts. But to follow through this task, we should know in detail how the aircraft concourse shape under the tell of aircraft manufacture is.In Vietnam, the aviation commercialize has a great festering with the air traffic increasing year by year. In order to meet the high charter, Vietnamese airliners soak up to add more aircraft to their fleet. They non only purchase aircraft by itself, but also need to lease from aircraft lessors. So that, aircraft lessors ache to support airlines to break overmaster their fleet. Beside, leasing aircraft sector is the newfound unitary in Vietnam aviation industry. With this purpose, this final paper exit provide an overview of the egress chain of mountains man agement practices by Airbus and Boeing in their new products as Airbus A350 XWB (Extra great Body) and Boeing B787 Dreamliners and how the both aircraft manufactures apply run process management. Understanding this process, aircraft lessors will trace a suitable decision to purchase aircrafts.On this occasion, I would like to thanks my partners in Boeing Commercial Airplane and Airbus SAS for providing necessary internal documents for reference. I also thanks my colleague in aircraft technical section in my company, Vietnam Aircraft Leasing Company, and technical staff from Vietnam Airlines Corporation for supporting during the info collection.2. Research Goals and uprise2.1 Goals In this final paper, I would like to provide the some overview for sagaciousness the e merge of sum up chain management strategies in the commercial aviation industry. It also steers the longer-term implications of the supply chain management in the aviation industry in the future.2.2 Approach To implement a comparative analysis of supply chain management applied by Boeing and Airbus and their flex process management. To instruction on two new large organic evolution programs in commercial aviation (Boeing 787 Dreamliners and Airbus A350 XWB). To concentrate on the common set of suppliers supporting both programs to develop a sharp comp ar and contrast perspective, flavour at Boeing Airbus from the vantage point of these common suppliers.3. Literature reviewThe extensive belles-lettres sho prolongation that lean supply chain management practices represent a critical source of sustained free-enterprise(a) advantage and containing some factors as follo extension service supplier vane architecture linked to companys vision strategy. archean supplier integrating into design and development. Visibility and transpargonncy through untied communions. Long-term, trust- mingyd, mutually-beneficial relationships. Continuous supplier development process improvement. New su pplier network architectures represent a defining feature of emerging new stage business feigns for managing interwovenity, uncertainty and competition in a globalized market milieu. Access to enthr unmatchablement capital, new markets and new sources of innovation. Greater protrudesourcing, strategic alliances partnerships, delegation of great responsibilities to suppliers to background risk and transaction be. Internet-enabled information technologies and remainss radically redefining supplier integration via amend information visibility and information-sharing aptitude gains. Machine-to-machine data communication ashes integration globally. Unprecedented visibility, transparency and accuracy. Greater flexibility in inter attaching diametric bodys, facilitating both bilateral and multilateral coaction.4. Research intromission To develop baseline data around the individua rock supplier companies. To gauge whether and the extent to which they are employing lean practices. To assess the extent to which the two large guest companies are practicing lean principles in their engagement with the suppliers. To document the extent to which the two large customer companies have proactively required the suppliers to adopt lean practices. To develop more deep into particularized snuff itical areas (e.g., role in design development, information/communication relate, contract design). To probe how exactly the two customer companies manage their relationships with these ad hoc suppliers. Open source information to ensure external validity generalizability. about the two companies their supply chain management practices. About the two specific programs. About the common suppliers.5. Boeing 787 course of study5.1 Overview Launch Year in 2002 in order to responding to the overwhelming preference of airlines around the world, Boeing Commercial Airplanes new woodworking plane is the Boeing 787 Dreamliner, a super-efficient airplane. An internati onal team of top aerospace companies is developing the airplane, led by Boeing at its Everett, Washington facility near undersidetle. Represents Boeings response to expected demand for an aircraft that would cost less to own, operate and maintain. Targeted at the warmness of the market section the rapid, direct, point-to-point connections aviation market segment, with capacity of 250 passengers.Unparalleled PerformanceAt the send-off stage of the program, Boeing tent to launch 03 type of aircraft 787-3, 787-8, 787-9 but up to now, there are 02 main versions. The 787-8 Dreamliner will carry 210 250 passengers on routes of 7,650 to 8,200 nautical miles (14,200 to 15,200 kilometers), trance the 787-9 Dreamliner will carry 250 290 passengers on routes of 8,000 to 8, viosterol nautical miles (14,800 to 15,750 kilometers).In addition to obstetrical delivery big-jet begins to mid-size airplanes, the 787 will provide airlines with unmatched burn efficiency, resulting in exceptio nal environmental performance. The airplane will use 20 percent less give notice for comparable missions than todays likewise sized airplane. It will also travel at speeds similar to todays fastest wide bodies, Mach 0.85. Airlines will enjoy more burden revenue capacity.Passengers will also collect improvements with the new airplane, from an interior environment with higher humidity to change magnitude comfort and convenience.Advanced TechnologyThe fundamental to this exceptional performance is a suite of new technologies being authentic by Boeing and its international technology development team.50 percent of the firsthand structure including the fuselage and wing on the 787 will be made of composite plant materials.An present architecture will be at the heart of the 787s systems, which will be more simplified than todays airplanes and offer increased functionality. For example, the team is looking at incorporating health-monitoring systems that will allow the airplane to self-monitor and report maintenance requirements to ground-based electronic computer systems.General Electric and Rolls-Royce are the two engine manufacture to develop engines for the new airplane. It is expected that advances in engine technology will nominate as much as 8 percent of the increased efficiency of the new airplane, representing a nearly two-generation jump in technology for the middle of the market.Another improvement in efficiency will come in the way the airplane is knowing and built. New technologies and processes are in development to help Boeing and its supplier partners achieve unprecedented levels of performance at all(prenominal) phase of the program. For example, by manufacturing a one-piece fuselage section, we are eliminating 1,500 aluminum sheets and 40,000 50,000 fasteners. inveterate ProgressThe Boeing board of directors granted authority to offer the airplane for change in late 2003. Program launch occurred in April 2004 with a criminal record order from All-Nippon Airways. Since that time, 56 customers from six continents of the world have placed orders for 847 airplanes set at $147 billion, making this the most successful launch of a new commercial airplane in Boeings history. The 787 program opened its final assembly plant in Everett in May 2007. First relief valve of stairs of the 787 Dreamliner occurred in Dec. 2009.The program has signed on more than 40 of the worlds most heart-to-heart top-tier supplier partners and unneurotic finalized the airplanes configuration in September 2005. Boeing has been working with its top tier suppliers since the early detailed design phase of the program and all are connected virtually at 135 sites around the world. xi partners from around the world completed facility construction for a total of three million additional square feet to create their study structures and influence the next new airplane to market.5.2. SpecificationModelB787-8B787-9EngineGEnext or Rolls Royce T rent groundsGEnext or Rolls Royce Trent kelvinRange7,650 to 8,200 nautical miles (14,200 to 15,200 kilometers)8,000 to 8,500 nautical miles (14,800 to 15,750 kilometers)Seat210 to 250 passengers250 to 290 passengersConfigurationTwin aisleTwin aisleCross particle226 inches (574 centimeters)226 inches (574 centimeters)Wing Span197 feet (60 meters)197 feet (60 meters)Length186 feet (57 meters)206 feet (63 meters)Height56 feet (17 meters)56 feet (17 meters) cruise SpeedMach 0.85Mach 0.85 get along Cargo Volume4,400 cubic feet5,400 cubic feetooze Takeoff Weight502,500 lbs (227,930 kilograms)545,000 lbs (247,208 kg)Program milestonesAuthority to offer late 2003Program launch April 2004Assembly start 2006First roll-out ceremony July 2007First trajectory December 2009First delivery Mid Q1/2011 (estimated)5.3. Program Fact tackThe 787 Program covers many areas of interest, from the market, customers, and airplane technology to manufacturing enhancements and an extensive partner team, am ong others. present are some interesting facts and figures on a number of these subject field areasMarket size3,310 units over 20 years (Boeing Market call 2009-2028)Firm orders by customer (up to October 2010 at www.boeing.com)Model SeriesOrdersDeliveriesTotalB787-8629629B787-9218218B787 Total847847B787 vs. B777 on composites and aluminum (by saddle)B787B77750 % composites12 % composites20 % aluminum50 % aluminumMaterial breakout on B787Composites 50%aluminum 20%Titanium 15%Steel 10% other(a) 5%Better designe More go off efficient 20 % more fuel efficient than similarly sized airplanes Produces few emissions 20 % fewer than similarly sized airplanes Better cash seat mile cost than confederate airplanes 10 % Better maintenance be 30%GeneratorsFour at 250 kVA (two per engine)Two at 225 kVA (on auxiliary power unit)Hydraulic powerDistributed at 5,000 pounds per square inch on the 787 3,000 pounds per square inch standard prefer of the new electric architecture Extracts as much as 35 percent less power from the engines than tralatitious pneumatic systems on todays airplanes.US and non-US content on the 787 some 70 percent US Roughly 30 percent non-US.The number of new city pairs the 787 will connect At least 450Other special features Represents large step towards all-electric-airplane, one in which all systems are run by electricity. Driven by the belief that power electronics, key to the all-electric airplane, are on a pore curve of performance cost improvement, while pneumatic systems growth has tapped out around 1995. The traditional consort air and hydraulic power are replaced with electrically power compressors and pumps. Cabin pressurized by electric motors, not by bleed air employ by almost every pressurized aircraft. An open architecture centralized computer hosts the avionics and utility functions, rather than dozens of individual buses. Anti-icing of the wing to be done with electric heat instead of bleed air. Composites resist long-term w ear and tear, because cracks do not propagate from holes as in aluminum inspections are made easier maintenance intervals stretched to universal gravitational constant hrs (compared with 500 hrs for 767 or 700 hrs for A330 the two most prominent aircraft 787 aims to replace). Much more moil focus on flexible financing arrangements, plus closer watchfulness to passenger comfort, fuel burn and life cycle costs.6. Airbus A350 XWB Program6.1. OverviewAimed at compete with B787 from Boeing, Airbus has decided to build A350 XWB based on the technologies developed for A380. The Airbus A350 XWB is a long-range, mid-size, wide-body family of airliners currently under development by European aircraft manufacturing business Airbus. The A350 will be the first Airbus with both fuselage and wing structures made in the beginning of carbon fibre-reinforced polymer. The A350 is designed to compete with the Boeing 777 and the Boeing 787. Airbus claims that it will be more fuel-efficient, with up to 8% refuse in operation(p) cost than the Boeing 787. It is scheduled to enter into airline service during the second half of 2013. The launch customer for the Airbus A350 is Qatar Airways. Development costs are projected to be US$15 billion.Airbus utilises next-generation manufacturing and assembly techniques to blade the A350 XWB a more efficient and veritable aircraft. The A350 XWB is equipped with an advanced cockpit and onboard systems optimised for boldness and simplicity, while its advanced wing design makes this aircraft faster and quieter.The A350 XWBs onboard systems are designed for maximum reliability, operability and simplicity.The advanced wing design of the A350 XWB will make it a faster, quieter and more efficient aircraft.Airbus utilises new techniques to optimise the A350 XWBs incubus, maintenance and operating costs.The A350 XWBs cockpit features the modish in display technology and integrated modular avionics.6.2. SpecificationAircraft Dimensions overall length198 ft.7.5 in.219 ft. 5.5 in.242 ft. 4.7 in.Height55 ft. 11.3 in.55 ft. 11.3 in.55 ft. 11.3 in.Fuselage diameter19 ft. 58 in. (horiz)19 ft. 58 in. (horiz)19 ft. 6 in. (horiz)Wingspan (geometric)212 ft. 5 in.212 ft. 5 in.212 ft. 5 in.Wing area (reference)4,740 ft24,767 ft24,767 ft2Wing sweep (25% chord)31.9 degrees31.9 degrees31.9 degreesWheelbase81 ft. 7 in.94 ft. 1 in.108 ft. 7 in.Wheel track34 ft. 9 in.34 ft. 9 in.35 ft. 2 in.Basic doing DataEngines2 Rolls-Royce Trent XWB2 Rolls-Royce Trent XWB2 Rolls-Royce Trent XWBEngine thrust range75,000 lb. slst.84,000 lb. slst.93,000 lb. slst.Typical passenger seating270 (3-class)314 (3-class)350 (3-class)Range (w/max. passengers)8,300 nm.8,100 nm.8,000 nm.Max. operating Mach number (Mmo)0.89 Mo.0.89 Mo.0.89 Mo.Design Weights utmost ramp heaviness548.7 lbs. x 1000592.8 lbs. x 1000659.0 lbs. x 1000Maximum takeoff weight546.7 lbs. x 1000590.8 lbs. x 1000657.0 lbs. x 1000Maximum landing weight407.9 lbs. x 1000451.9 lbs. x 1000503.8 lbs . x 1000Maximum zero fuel weight382.5 lbs. x 1000423.3 lbs. x 1000470.6 lbs. x 1000Maximum fuel capacity34,082 US gal.36,460 US gal.41,215 US gal.Some Design Technical Features Cockpit design follows same cockpit layout, characteristics and operating procedures as in the A320 and A330/A340 platforms, providing a number of advantages (e.g., in terms of clustering training, crew transition, cross-crew qualification). Also incorporates new features that benefit from innovation in technologies for displays, passage management navigation systems. First commercial airplane to adopt EHAs (electrohydrostatic actuators) flight control technologies, a step forward to the all-electric airplane. EHAs are electrically powered but use hydraulic pumps and reservoirs that transform electrical power into hydraulic power. Advantages large savings in terms of weight and space (e.g., lessening in the size of pipelines, actuators and other components, power generation equipment, tubing, amount of placid required), as well as ease of installation. First commercial aircraft open(a) of flying with total hydraulic failure, using electricity to operate the flight control surfaces. Extensive use of composite materials 25% (by weight), compared with 10% in A320 and 30% in A340-500/600. Use of carbon composites and advanced metallic mark materials, along with laser beam welding to eliminate fasteners, reduce weight and provide enhanced fatigue tolerance. Glare highly resistant to fatigue, used in construction of panels for upper fuselage. atomic number 13 and fiberglass layers of Glare do not allow propagation of cracks. Glare lighter than conventional materials represents a weight saving of about 500kg.6.3. Fact SheetFirm orders by customer (up to October 2010 at www.airbus.com)Model SeriesOrdersDeliveriesTotalA350-800158158A350-900340340A350-10007575A350 Total573573A350 vs. B787 on material breakout (by weight)A350B787Composites 53%Composites 50%Aluminum 19%Aluminum 20%Titani um 14%Titanium 15%Steel 6%Steel 10%Other 8%Other 5%Airbus internal goal to freeze the design and expects10% lower airframe maintenance cost14% lower empty seat weight than competing aircraftMore fuel efficient Up to 25 % more fuel efficient than similarly sized airplanesProduces fewer emissions Up to 25% fewer than similarly sized airplanesBetter cash seat mile costs than peer airplanes 15%7. Supply Chain Management Practices by Airbus and Boeing Supplier selection on both programs following a typical competitive bid process during initial plateau phase selection on best-value basis. Boeing retains unified list of pre-qualified suppliers/vendors (qualified split list QPL qualified vendor list QVL). Airbus does not yet maintain such a unified list, but move in same direction. Both have major suppliers inscribe early in design and development process. Both yieldted to long-term, mutually-beneficial, reliable and stable relationships with key suppliers. Supplier partnerships typi cally trammel to suppliers that continuously show excellence in performance, demonstrate credible long-term business interest, and back it up with their own development and investment. Life-of-program fixed-cost contracts, but with some differences. Electronic links with suppliers via supplier portals (request for quote/proposal order placement technical data interchange, such as technical specifications, key characteristics, engineering drawings exchanging documents facilitating virtual collaboration with global partnering suppliers in a 3D design software environment). RFID (Radio relative frequency Identification) initiatives Both Boeing and Airbus have expanded the application of RFID tags for both the B787 and A350 programs they have worked together to reach for consensus regarding standards for using global RFID technology on commercial airplanes).8. major(ip) suppliers responsibility is greater Important strategic shifts in supply chain management, driven by pressing need t o reduce cost and string out development costs. Both have asked major suppliers in B787 and A350 to absorb non-recurring costs, then greatly shifting costs and risks to suppliers, but using somewhat different approaches. Suppliers delegated much more responsibility for design, development and manufacturing through closer collaboration, partnerships and integration across supplier networks.Boeing 787 Boeing has gone the extra distance with the 787 program retains only about 33%-35% of the total 787 work share Deliberate effort to reduce parts count to enable snap three-day assembly of the 787 Suppliers moving up the value chain assuming more of a system integrator role, providing more integrated components and managing their own sub-tier suppliers This is the first time Boeing has outsourced the stainless wing design and manufacturing to external suppliers (risk-sharing partners Fuji Heavy Industries, Ltd. center wing box Kawasaki Heavy Industries, Ltd. main wing fixed trailing borderline Mitsubishi Heavy Industries, Ltd. wing box) This is the first time Boeing applied lean manufacturing process in B787 program to improve absence management while merging its short and long-term disability program administration with leave-of-absence offering.Airbus A350 Airbus, as a multinational consortium prior to July 2001, had already adopted a strategic partnership model with well-defined work-share arrangements. Airbus has increased its outsourcing in the A350 program, but has take over kept in-house sum of money technologies, such as composite technology and wing design. Airbus also applied lean process technique by acquire advice from Porsche (a German car manufacture) in order to reduce production time and avoid delay as happened in A380 program.9. Worldwide OutsourcingBoth Airbus and Boeing have increased their global outsourcing in Japan, china, India, Middle East, east Europe and Russia (estimated in the future). Why the two aircraft manufacture select th ese region because of the strong sparing growth as well as fast-growing air travel particularly in Asia/Pacific region. Large Asian and Middle Eastern carriers as Singapore Airlines, Emirates, Vietnam Airlines now are the major customers. The variety of start arrangements have opened up new market opportunities, tied to increased sourcing (e.g., from China).Boeing strategy long unparalleled dominance in Nipponese market strong presence in China. In Japan 80% of orders from Japanese airlines from Boeing during last decade Japanese suppliers (heavies) account for 35% of 787 work-shares. In China activities range from subcontracting, joint ventures, technical training and assistance for cooperative programs gross support from Chinese suppliers (valued at $1.6 billion), supplying essential composite parts and structures for 787 programs.Airbus strategy relative newcomer to Japan China. In Japan face difficulties in winning orders from Japanese airlines, but has contracted work wi th Japanese suppliers. In China sale activities in China jumped to 219 aircraft in 2005 from 56, qualifying Boeing by delivering 6 more aircraft committed to doubling procurement from Chinese suppliers to $120 million/year by 2010 announced Tianjin will be site for Airbus first final assembly plant outside Europe.10. The emerging Unique ModelBoeing ModelThe Boeing 787 experience represents a unique model for the future in supply chain management. In essence, the Boeing model is about optimizing the total business, not just the supply chain in the traditional sense. Supply chain architecture as an integral part of the entire program extended enterprise architecture. Main emphasis is on optimizing portfolio of core competencies in entire value stream for mutual benefit. Lifecycle value creation perspective, not short-term waste elimination or cost minimisation for Boeing itself. Boeing has adopted a bold new innovative system integrator role. This represents a revolutionary departur e from the past. Boeing has asked all suppliers to carry all of the non-recurring costs in return, gives back to risk-sharing partnering suppliers the intellectual property seriouss on the components or systems they provide. Contracts are so designed that if the aircraft does well in the marketplace, the risk-sharing partners derive direct benefits and major partnering suppliers cease make design trades within each work portion and across company units to find optimal system solutions. Lower-tier suppliers are not provided IP ownership but are given long-term relationships, where they can benefit from scale economies. Boeing only provides high-level interface definition the first-tier (major partnering suppliers) is trustworthy for the detailed interface definitions designs. Suppliers work together and Boeing acts as referee in case of conflicts. Web-enabled information technologies systems a critical enabler.Airbus model Airbus is reported to have established risk-sharing par tnerships with more than 30 of its major suppliers covering $3.1 billion or 25% of total program non-recurring costs. These suppliers include Alenia, Eurocopter, Fokker, Gamesa, Labinal, Saab). However, this needs closer scrutiny, to see what it actually means. Airbus also continues to exercise control over all system and detail engineering interface definitions. Airbus suppliers work in parallel (bilaterally with Airbus), with limited lateral communications among them. Unlike Boeing, Airbus has no strong partners for major risk-sharing activities or as contributors to development spending. However, Airbus is currently pursuing new partnering arrangements under its Airbus berth competitiveness Industrial Plan. Plan proposes radical cost-cutting rationalization measures (cutting 10,000 jobs, closing run through or selling specific sites, rearranging workshare allocation). Investment partners being sought for the wide Enterprise sites (Nordenham, Germany Meaulte, France Filton, UK) . As part of the plan, supplier relationships would also change (Airbus wants partners to commit to long-term cost reductions). Airbus also reducing its supplier base from 3,000 down to 5,000.11. ConclusionAerospace supply chain management will continue to explicate from a transactional or relational business model to one involving risk-sharing and cost-sharing prime-supplier partnerships, alliances closely-knit cooperative relationships. Where primes (system-integrators) will likely to move closer to a total system integrator lifecycle value provider role. Major suppliers to assume greater system-integrator role, with greater responsibility for design, development, manufacturing, and after-market lifecycle support. Suppliers, in general, moving from short-term service providers to long-term partners. orbiculate outsourcing considered as aerospace supply chains and is likely to be a attracter more quite internationalized in the future. Adoption of information technologies enab ling network-wide connectivity right down to lower tiers an imperative in the future for coordinating complex set of interdependencies. Continued consolidation likely in aerospace supplier base to build greater specialization broader system integration skills, and stronger financial gumption to make the necessary investments to enhance core capabilities.