Outlook for Aluminum in the Commercial Airplane Market Gen Ses John Byrne.pdf · Copyright © 2015...
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Copyright © 2015 Boeing. All rights reserved. The statements contained herein are based on good faith assumptions and are to be used for general information purposes only. These statements do not constitute an offer, promise, warranty or guarantee of performance. John Byrne Vice President- Supplier Management Aircraft Materials and Structures Boeing Commercial Airplanes October 21, 2015 Outlook for Aluminum in the Commercial Airplane Market 1
Transcript of Outlook for Aluminum in the Commercial Airplane Market Gen Ses John Byrne.pdf · Copyright © 2015...
Copyright © 2015 Boeing. All rights reserved.
The statements contained herein are based on good faith assumptions and are to be used for general information purposes only. These statements do not constitute an offer, promise, warranty or guarantee of performance.
John Byrne Vice President- Supplier Management
Aircraft Materials and Structures Boeing Commercial Airplanes
October 21, 2015
Outlook for Aluminum in the Commercial Airplane Market
1
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Region Airplanes
Airplane deliveries: 38,050 2015 - 2034
0
5,000
10,000
15,000
20,000
25,000
30,000
Regional jets 7%
Single- aisle 70%
Small wide-body
13%
Large wide-body
1%
Medium wide-body
9%
2,490
26,730
4,770
540 3,520
New airplane deliveries by region 2015 - 2034
38%
19%
8%
8%
3% 3%
21%
38,050
Asia 14,330
North America 7,890
Europe 7,310
Middle East 3,180
Latin America 3,020
Africa 1,170
C.I.S. 1,150
World Total 38,050
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Global fleet will double Units
38,050
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2014 2034
5,510
Retained fleet
16,090
Replacement
42%
21,960
Growth
58%
43,560
21,600
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Sold 1,432 and delivered 723 airplanes – both Boeing records!
Launched 737 MAX 200
Achieved firm configuration on 787-10
Delivered 787-9 into passenger service
Celebrated KC-46A tanker first test flight
Began construction on new 777X Composite Wing Center
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Delhi
Birmingham
Melbourne
Sydney
Narita San Jose
San Diego
Boston
Addis Ababa
Washington
Houston
Lagos
Denver
Stockholm
New York
Bangkok
Oslo Helsinki
San Francisco
Chengdu
London
Austin
Copenhagen
Los Angeles Oakland
Orlando
More than 42 new nonstop markets now connected with the 787
Announced routes in-service, pending commencement, or approval As of January 2015
Fort Lauderdale
Announced
In operation
Lome
Sao Paulo
Singapore
Shanghai
Toronto
Monterey Wuhan
Beijing
Edinburgh
Doha
Brisbane
Haneda
Osaka
Jakarta
Dusseldorf
Domodedovoi
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Superior value, efficient market coverage
737-900ER
200
150
100
500
450
400
350
300
250
Se
ats
200
150
100
500
450
400
350
300
250
Se
ats
737-700
737-800
747-8
787-9
777-200ER
777-300ER
787-8
767-300ER
737 MAX 9
737 MAX 8
737 MAX 7
787-9
747-8
787-8
787-10
Current Boeing Future Boeing
777-8X
777-9X
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2011 2013 2014
Anticipate ~60% rate increase from 2011 through 2017
Updated As of: 2/10/15
2015 2012 2016 2017 End of Decade
767: 2/month
787: 12/month 737:47/month
737: 52/month
787: 14/month 747: 1.3/month
Aggregate of all
airplane programs
63.3 per month
44 per month
70.6 per month
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400 thousand parts
3.1 million parts
2.3 million parts
3 million parts
6 million parts
$43 billion spend ● 5,400 factories ● 500,000 people
Commercial Airplanes data only
1 billion parts procured per year
767 787 777 747-8 737
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Aggressive competition
• Traditional
• Emerging
Customers’ “more-for-less” expectations
• Affordable and mission-capable
• Low operating cost
• Environmentally progressive
• In-service reliability
• Standardization, first-time quality
Aggressive competition; customers demanding more for less
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1st Time Quality
Quality parts
Production readiness
Design Cost Out / Lean+
Design changes
Productivity improvements
Supply Chain Architecture
Strategic sourcing
Value creation / innovation
Competition / Commercial
Rebalancing / Volume
Balance risk & reward
Statement of work adjustment
Affordability focus areas
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Boeing designs what is needed for airplane performance
Materials are then tailored to fit that need
Aluminum, in particular, has had an important role in aircraft production with
the onset of many specific alloys used for various areas on the aircraft
– High strength sheets/slabs for coverings
– Complex blocks for components for engines, propellers, chassis, and frames
– Soft low-alloy aluminum-magnesium variants were used for rolling wire; rivets, welding
Today major producers of aluminum alloys are spread across the globe
Boeing Aluminum Supply Base
(Current) • Alcoa – Hard Alloy Extrusions (HAE), Flat
Rolled Products (FRP), Forgings
• Aleris – FRP
• AMAG – FRP
• Constellium – FRP
• Kaiser – FRP & HAE
• Minalex – Soft Alloy Extrusions
• Taber – HAE
• UAC – HAE
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Some of the most common aerospace uses for aluminum materials
Aluminum mills must continue to innovate to remain competitive with composites and titanium (cost, weight, strength, etc.)
7055 – Wing plate for higher strength
7075 – Thin, sheet type applications
6061/6013 – Tubing, brackets for high forming ability with low cost
2024/2524 – High damage
resistance, fuselage skins
A356/A357 – Castings
2219 – Heat resistance for semi-hot areas (struts)
2324 – Lower wing skins for added strength
7050 – Heavy, thick applications (forgings)
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Near term focus Inventory optimization
Volumes increasing with production rates (capacity is a concern)
More monolithic structures (less sub-assembly buildup)
Implementing scrap revert collection
Risk mitigation strategies to remove price variability New Alloys need to buy their way onto the airplane
Continued innovation and focus on execution
Long range needs Aluminum will continue to be largest content in commercial airplane manufacturing
Continue to innovate as competing technologies (e.g. composites) come down cost
curve
Integration of composites and aluminum in aerospace applications
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Supporting peak build rates
Demand management
Vertical Integration
Consolidation
Capitalization
Affordability
Affordability is the new market differentiator
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