Category Archives: Boeing

Alaska Airlines to join the Boeing ecoDemonstrator Program with a special 737-9 logo jet

Boeing made this announcement:

Boeing and Alaska Airlines announced today they are partnering on the latest Boeing ecoDemonstrator program and will flight test about 20 technologies on a new 737-9 to enhance the safety and sustainability of air travel.

In flights beginning this summer, Boeing and Alaska will test a new halon-free fire-extinguishing agent that significantly reduces effects on the ozone layer, evaluate an engine nacelle designed to reduce noise and assess cabin sidewalls made from recycled material, among other projects.

Since 2012, the ecoDemonstrator program has accelerated innovation by taking nearly 200 promising technologies out of the lab and testing them in the air to address challenges for the aviation industry and improve the passenger experience.

In five months of ecoDemonstrator flight tests, Boeing and Alaska will work with nine other partners to test new technologies. After tests are complete, the airplane will be configured for passenger service and delivered to Alaska. The program’s technologies include:

Testing a new fire extinguishing agent for aircraft that significantly reduces effects on the ozone layer. This material is intended to replace Halon 1301, which is no longer being produced.
Collaborating with the U.S. National Oceanic and Atmospheric Administration to measure greenhouse-gas levels in the atmosphere to support the agency’s climate modeling and long-term forecasting.
Evaluating acoustic lining concepts within the engine nacelle that may reduce noise on current engines and will inform designs for next-generation models.
Recycling carbon composite material from Boeing 777X wing production into a cabin sidewall panel. This durable, light material would reduce fuel use and carbon emissions, and supports Boeing’s goals for sustainable manufacturing.

Boeing’s current and future airplanes leverage a number of technologies evaluated in previous ecoDemonstrator testing, including:

Advanced Technology winglets on the 737 MAX family that reduce fuel use and emissions.
iPad apps that provide real-time weather and other data to pilots, improving fuel efficiency and reducing CO₂ emissions. These apps complement digital analytics services Boeing offers to help airlines optimize fleet utilization.
A camera system on the new 777X that will enhance safety by helping pilots avoid obstacles on the ground.

ecoDemonstrator test flights are flown on a blend of petroleum-based and sustainable aviation fuel. SAF is in regular use today, reduces life-cycle CO₂ emissions by up to 80%, and offers the most immediate and greatest potential to reduce emissions over the next 20 to 30 years in all commercial aviation markets.

In January this year, Boeing committed to make sure its commercial airplanes are capable and certified to fly on 100% SAF by 2030. The company also plans to work with regulatory authorities and across the industry to raise the current 50% blending limit for expanded use of SAF. Boeing’s 2018 ecoDemonstrator 777 Freighter made history as the world’s first commercial airliner to fly on 100% sustainable fuel.

Goal: standardizing inlet location

“The ecoDemonstrator program provides NOAA an unparalleled opportunity to test our greenhouse gas sampling system on a civilian airliner,” said Colm Sweeney, lead scientist for the NOAA Global Monitoring Laboratory’s aircraft measurements program. “Standardizing the location and installation of greenhouse gas monitoring instruments on commercial aircraft will be an important first step in expanding our sampling network to provide data for scientists and policymakers interested in understanding greenhouse gas emissions that are driving climate change.”

For the past 10 years, Boeing’s ecoDemonstrator program has taken nearly 200 promising technologies out of the lab and tested them in the air to address challenges for the aviation industry and improve the passenger experience. Each year, the company selects a different aircraft for ecoDemonstrator flight testing by partnering with an airline or using a Boeing-owned aircraft. The NOAA project is one of several technologies being flight-tested this year that are related to environmental sustainability.

Hiring private contractors to sample greenhouse gases from the air is an important aspect of NOAA’s climate research. Here, Paolo Wilczak pilots a sampling flight over southeastern Connecticut on April 25, 2020, as part of the East Coast Outflow field mission. The Global Monitoring Laboratory hopes to add civilian airliners to its sampling fleet. Credit: Paolo Wilczak, Scientific Aviation

The NOAA Global Greenhouse Gas Reference Network measures the atmospheric distribution and trends of the three main, long-term drivers of climate change – carbon dioxide, methane, and nitrous oxide – along with carbon monoxide, an indicator of air pollution. The network collects samples from four baseline atmospheric observatories, as well as from 50 partner institutions and trained volunteers around the world. Since 1992, NOAA has contracted with a handful of private pilots who have collected air samples at a range of altitudes and locations across North America.

Data collected by aircraft provide a view of how the large-scale horizontal and vertical distribution of the measured gases change throughout a given year over the continent. This allows scientists to estimate the contribution of both natural and manmade emissions from the North America continent to the global atmosphere.

Added measurements would improve climate models

While NOAA’s current network of 14 U.S. land-based sites provide valuable scientific data for estimates made by models and satellites, scientists need to increase the number and location of samples to directly measure changes in natural and human-made emissions, and the effectiveness of policies designed to reduce climate change impacts.

NOAA’s ultimate goal is to install greenhouse gas measurement equipment on in-service aircraft to enhance its existing long-term greenhouse gas dataset, which informs policymakers and climate researchers around the world. U.S. commercial aircraft routinely collect weather observations, particularly vertical profiles of temperature and relative humidity captured on takeoff and landing, which have become increasingly important to improving short-term numerical weather models that forecasters rely on to predict severe weather.

“Greenhouse gas measurements made from U.S. commercial airliners would help scientists verify the effectiveness of mitigation efforts in urban areas near major metropolitan airports, and changes in natural emissions coming from melting permafrost near remote airports in the high Arctic,” said Kathryn McKain, the lead scientist for NOAA’s Commercial Aircraft Sampling Network.

Boeing halts 787 Dreamliner deliveries pending approval of planned inspection method

From Reuters:

“The Federal Aviation Administration said Friday that Boeing had temporarily halted deliveries of 787 Dreamliners as the agency waits for more data to determine if the planemaker’s planned inspection method meets federal requirements.

Boeing said earlier it was providing the FAA with more information on its undelivered 787 Dreamliners but that there was no impact on planes already in service.

The FAA noted it had issued two airworthiness directives to address production issues for in-service airplanes.”

SMBC Aviation Capital orders 14 Boeing 737 MAX jets

Boeing and SMBC Aviation Capital today announced the lessor is positioning its portfolio for air traffic recovery by ordering 14 additional 737-8 jets, growing its 737 MAX portfolio. The new order comes as airlines prepare for a robust return to air travel and modernize their narrow body fleets to reduce fuel use and carbon emissions.

The new purchase builds SMBC Aviation Capital’s 737 MAX portfolio to 121 jets, expanding their investment in Boeing’s single-aisle family. SMBC Aviation Capital also continues to incorporate new 737 MAX airplanes into the global fleet. In the first quarter of 2021, the lessor delivered 13 737-8s to customers, including 11 planes to Southwest Airlines in the U.S. and two planes to TUI in Europe.

Reuters: Boeing to boost 737 MAX production in late 2022

From Reuters:

“Boeing has drawn up preliminary plans for a fresh sprint in 737 MAX output to as many as 42 jets a month in fall 2022, industry sources said.”

Previously Boeing had provided industry guidance that it expected to have a production rate of 31 aircraft a month by early 2022.

Boeing has not yet confirmed the Reuters report.

Boeing 737-8 MAX 8 Slide Show:

Boeing 737-9 MAX 9 Slide Show:

Boeing expands partnership with COOPESA to convert more 737-800s to freighters, FAA approves fix for 737 MAX electrical flaw

Boeing has announced a new partnership with a Costa Rica-based maintenance, repair and overhaul (MRO) provider to create additional conversion capacity for the 737-800 Boeing Converted Freighter.

Boeing will open two 737-800BCF conversion lines with Cooperativa Autogestionaria de Servicios Aeroindustriales (COOPESA) in Alajuela, Costa Rica. The first of the new conversion lines is expected to open in early 2022, with the second anticipated later that year. Boeing forecasts 1,500 freighter conversions will be needed over the next 20 years to meet growing demand. Of those, 1,080 will be standard-body conversions, with nearly 30% of that demand coming from North America and Latin America.

Currently, Boeing converts 737-800 passenger airplanes to freighters at three locations: Boeing Shanghai Aviation Services (BSAS) in Shanghai, China; Guangzhou Aircraft Maintenance Engineering Company Limited (GAMECO) in Guangzhou, China; and Taikoo (Shandong) Aircraft Engineering Co. Ltd. (STAECO) in Jinan, China.

To date, the 737-800BCF has won more than 180 orders and commitments from 15 customers on four continents. In March, Boeing re-delivered the 50^th 737-800BCF since entering into service in 2018.

In other news, the FAA has approved Boeing’s fix of the 737 MAX electrical problem. This will pave the way for over 100 impacted aircraft to return to service and be delivered.

Reuters: FAA orders Boeing to fix some 737 MAX electric systems

Boeing is facing new issues with its 737 MAX, this time affecting 109 aircraft worldwide, including 71 in the United States. Boeing is now halting all deliveries of the type.

From Reuters:

“The U.S. Federal Aviation Administration (FAA) on Wednesday ordered Boeing Company to fix bonding issues in the electrical systems of some of its 737 MAX planes that could lead to a loss of engine ice protection loss and critical functions on the flight deck.

The FAA said the issue affected 109 airplanes worldwide delivered to airlines, including 71 in the United States and warned the issue if not fixed “could affect the operation of certain systems, including engine ice protection, and result in loss of critical functions and/or multiple simultaneous flight deck effects, which may prevent continued safe flight and landing.”

Read the full article.

Boeing recommends operators of some 737 MAX airplanes temporarily remove them from service to address a potential electrical issue

Boeing has issued a recommendation to 16 customers (including American, Southwest and United) to remove and inspect certain Boeing 737 MAX aircraft due to a “potential electrical issue”. This is apparently due to a production issue when the aircraft were built.

The FAA issued this statement:

Boeing recommends operators of some 737 MAX airplanes temporarily remove them from service to address a potential electrical issue. The FAA will ensure the issue is addressed. Passengers should contact airlines about possible flight delays and cancellations.

Boeing issued this statement:

Boeing has recommended to 16 customers that they address a potential electrical issue in a specific group of 737 MAX airplanes prior to further operations. The recommendation is being made to allow for verification that a sufficient ground path exists for a component of the electrical power system.

We are working closely with the U.S. Federal Aviation Administration on this production issue. We are also informing our customers of specific tail numbers affected and we will provide direction on appropriate corrective actions.

American Airlines has grounded 17 MAX aircraft.

Above Copyright Photo: American Airlines Boeing 737-8 MAX 8 N378SC (msn 44471) BFI (Joe G. Walker). Image: 952213.

Southwest Airlines has removed 30 of its 58 MAX aircraft for inspections.

Above Copyright Photo: Southwest Airlines Boeing 737-8 MAX 8 N8701Q (msn 42554) PAE (Nick Dean). Image: 953439.

United Airlines has grounded 16 of its 30 MAX aircraft according to USA Today.

Above Copyright Photo: United Airlines Boeing 737-9 MAX 9 N1780B (N27520) (msn 64499) PAE (Nick Dean). Image: 951068.

Boeing statement on United Airlines flight 328

Boeing issued this statement:

“Boeing is actively monitoring recent events related to United Airlines Flight 328. While the NTSB investigation is ongoing, we recommended suspending operations of the 69 in-service and 59 in-storage 777s powered by Pratt & Whitney 4000-112 engines until the FAA identifies the appropriate inspection protocol.

Boeing supports the decision yesterday by the Japan Civil Aviation Bureau, and the FAA’s action today to suspend operations of 777 aircraft powered by Pratt & Whitney 4000-112 engines. We are working with these regulators as they take actions while these planes are on the ground and further inspections are conducted by Pratt & Whitney.

Updates will be provided as more information becomes available.”

FAA issues airworthiness directive for 222 Boeing 787 Dreamliners

From Reuters:

“The U.S. Federal Aviation Administration on Wednesday issued an airworthiness directive for certain Boeing Co 787 airplanes, asking for inspection of the jets following reports of torn decompression panels in the bilge area.

The directive comes as Boeing grapples with multiple production flaws on its 787 Dreamliners that have triggered intensive inspections and more than 80 undelivered planes.”

The Directive:

The FAA is adopting a new airworthiness directive (AD) for certain The Boeing Company Model 787-8, 787-9, and 787-10 airplanes. This AD requires repetitive general visual inspections of the bilge barriers located in the forward and aft cargo compartments for disengaged or damaged decompression panels, reinstallation of disengaged but undamaged decompression panels, and replacement of damaged decompression panels. This AD was prompted by reports of multiple incidents of torn decompression panels being found in the bilge area. The FAA is issuing this AD to address the unsafe condition on these products.

Boeing reports a large 4Q and 2020 loss

Boeing reports a massive 4Q and 2020 loss ($11.9 billion):

Fourth Quarter 2020

Financial results significantly impacted by COVID-19, 737 MAX grounding, and commercial widebody programs
777X program recorded $6.5 billion pre-tax charge; first delivery expected in late 2023
737 MAX began receiving regulatory approval to resume operations and restarted deliveries
Revenue of $15.3 billion, GAAP loss per share of ($14.65) and core (non-GAAP)* loss per share of ($15.25)

Full-Year 2020

Revenue of $58.2 billion, GAAP loss per share of ($20.88) and core (non-GAAP)* loss per share of ($23.25)
Operating cash flow of ($18.4) billion; cash and marketable securities of $25.6 billion
Total backlog of $363 billion, including more than 4,000 commercial airplanes
Strengthening safety processes, improving performance, managing liquidity and transforming for the future

Table 1. Summary Financial Results	Fourth Quarter			Full Year
(Dollars in Millions, except per share data)	2020	2019	Change	2020	2019	Change

Revenues	$15,304	$17,911	(15)%	$58,158	$76,559	(24)%

GAAP
Loss From Operations	($8,049)	($2,204)	NM	($12,767)	($1,975)	NM
Operating Margin	(52.6)%	(12.3)%	NM	(22.0)%	(2.6)%	NM
Net Loss	($8,439)	($1,010)	NM	($11,941)	($636)	NM
Loss Per Share	($14.65)	($1.79)	NM	($20.88)	($1.12)	NM
Operating Cash Flow	($4,009)	($2,220)	NM	($18,410)	($2,446)	NM
Non-GAAP*
Core Operating Loss	($8,377)	($2,526)	NM	($14,150)	($3,390)	NM
Core Operating Margin	(54.7)%	(14.1)%	NM	(24.3)%	(4.4)%	NM
Core Loss Per Share	($15.25)	($2.33)	NM	($23.25)	($3.47)	NM

*Non-GAAP measure; complete definitions of Boeing’s non-GAAP measures are on page 6, “Non-GAAP Measures Disclosures.”

The Boeing Company reported fourth-quarter revenue of $15.3 billion, reflecting lower commercial deliveries and services volume primarily due to COVID-19 as well as 787 production issues, partially offset by a lower 737 MAX customer considerations charge in the quarter compared to the same period last year (Table 1). GAAP loss per share of ($14.65) and core loss per share (non-GAAP)* of ($15.25) reflected a $6.5 billion pre-tax charge on the 777X program and a tax valuation allowance, partially offset by a lower 737 MAX customer considerations charge. Boeing recorded operating cash flow of ($4.0) billion.

“2020 was a year of profound societal and global disruption which significantly constrained our industry. The deep impact of the pandemic on commercial air travel, coupled with the 737 MAX grounding, challenged our results. I am proud of the resilience and dedication our global team demonstrated in this environment as we strengthened our safety processes, adapted to our market and supported our customers, suppliers, communities and each other,” said Boeing President and Chief Executive Officer Dave Calhoun. “Our balanced portfolio of diverse defense, space and services programs continues to provide important stability as we lay the foundation for our recovery. While the impact of COVID-19 presents continued challenges for commercial aerospace into 2021, we remain confident in our future, squarely-focused on safety, quality and transparency as we rebuild trust and transform our business.”

The return to service of the 737 MAX in the U.S. and several other markets was an important step, and Boeing continues to follow the lead of global regulators and support its customers. Since the FAA’s approval to return to operations, Boeing has delivered over 40 737 MAX aircraft and five airlines have safely returned their fleets to service as of January 25, 2021, safely flying more than 2,700 revenue flights and approximately 5,500 flight hours.

Boeing now anticipates that the first 777X delivery will occur in late 2023. This schedule, and the associated financial impact, reflect a number of factors, including an updated assessment of global certification requirements, the company’s latest assessment of COVID-19 impacts on market demand, and discussions with its customers with respect to aircraft delivery timing.

The company continues to progress through its business transformation effort across five key areas including its infrastructure footprint, overhead and organizational structure, portfolio and investment mix, supply chain health and operational excellence. Boeing will continue these actions in 2021 to preserve liquidity, adapt to the new market, improve performance, sustain key investments and transform its business to be more productive, resilient and competitive for the long term.

Table 2. Cash Flow	Fourth Quarter		Full Year
(Millions)	2020	2019	2020	2019
Operating Cash Flow	($4,009)	($2,220)	($18,410)	($2,446)
Less Additions to Property, Plant & Equipment	($265)	($447)	($1,303)	($1,834)
Free Cash Flow*	($4,274)	($2,667)	($19,713)	($4,280)

*Non-GAAP measure; complete definitions of Boeing’s non-GAAP measures are on page 6, “Non-GAAP Measures Disclosures.”

Operating cash flow was ($4.0) billion in the quarter, reflecting lower commercial deliveries and services volume, as well as timing of receipts and expenditures (Table 2).

Table 3. Cash, Marketable Securities and Debt Balances	Quarter-End
(Billions)	Q4 20	Q3 20
Cash	$7.8	$10.6
Marketable Securities1	$17.8	$16.5
Total	$25.6	$27.1
Debt Balances:
The Boeing Company, net of intercompany loans to BCC	$62.0	$59.1
Boeing Capital, including intercompany loans	$1.6	$1.9
Total Consolidated Debt	$63.6	$61.0

1 Marketable securities consists primarily of time deposits due within one year classified as “short-term investments.”

Cash and investments in marketable securities decreased to $25.6 billion, compared to $27.1 billion at the beginning of the quarter, primarily driven by operating cash outflows partially offset by changes in the debt balance (Table 3).

Total company backlog at quarter-end was $363 billion.

Segment Results

Commercial Airplanes

Table 4. Commercial Airplanes	Fourth Quarter			Full Year
(Dollars in Millions)	2020	2019	Change	2020	2019	Change

Commercial Airplanes Deliveries	59	79	(25)%	157	380	(59)%

Revenues	$4,728	$7,462	(37)%	$16,162	$32,255	(50)%
Loss from Operations	($7,648)	($2,844)	NM	($13,847)	($6,657)	NM
Operating Margin	(161.8)%	(38.1)%	NM	(85.7)%	(20.6)%	NM

Commercial Airplanes fourth-quarter revenue decreased to $4.7 billion, driven by lower widebody delivery volume due to COVID-19 impacts as well as 787 production issues, partially offset by higher 737 deliveries and a lower 737 MAX customer consideration charge in the quarter compared to the same period last year (Table 4). Fourth-quarter operating margin decreased to (161.8) percent, primarily driven by a $6.5 billion pre-tax charge on the 777X program, lower delivery volume, and $468 million of abnormal production costs related to the 737 program, partially offset by a lower 737 MAX customer consideration charge.

Commercial Airplanes production rate assumptions reflect the continued impacts of COVID-19 on commercial demand, and the company will continue to assess them on an ongoing basis. The 737 program is currently producing at a low rate and expects to gradually increase production to 31 per month in early 2022 with further gradual increases to correspond with market demand. The 787 program plans to transition its production rate to 5 per month in March 2021, at which point 787 final assembly will be consolidated to Boeing South Carolina.

As discussed above, Commercial Airplanes now expects first delivery of the 777X to occur in late 2023 and has recorded a $6.5 billion reach-forward loss on the 777X program. Among the factors contributing to the revised first delivery schedule and reach-forward loss are an updated assessment of certification requirements based on ongoing communication with civil aviation authorities, an updated assessment of market demand based on continued dialogue with customers, resulting adjustments to production rates and the program accounting quantity, increased change incorporation costs, and associated customer and supply chain impacts. The production rate expectation for the combined 777/777X program remains at 2 per month in 2021.

Commercial Airplanes captured orders for 75 737 aircraft from Ryanair and eight 777 freighters from DHL, as well as a commitment for 23 737 aircraft from Alaska Airlines. Commercial Airplanes delivered 59 airplanes during the quarter, and backlog included over 4,000 airplanes valued at $282 billion.

Defense, Space & Security

Table 5. Defense, Space & Security	Fourth Quarter			Full Year
(Dollars in Millions)	2020	2019	Change	2020	2019	Change

Revenues	$6,779	$5,927	14%	$26,257	$26,095	1%
Earnings from Operations	$502	$34	1,376%	$1,539	$2,615	(41)%
Operating Margin	7.4%	0.6%	6.8 Pts	5.9%	10.0%	(4.1) Pts

Defense, Space & Security fourth-quarter revenue increased to $6.8 billion, primarily driven by higher volume on fighter programs and the rest of the portfolio as well as a charge on the Commercial Crew program in the same period last year (Table 5). Fourth-quarter operating margin increased to 7.4 percent reflecting more favorable performance on multiple programs compared with the same period last year, partially offset by a $275 million pre-tax charge on the KC-46A Tanker program primarily due to production inefficiencies including impacts of COVID-19 disruption.

During the quarter, Defense, Space & Security was awarded contracts for two KC-46A aircraft for Japan and AEW&C upgrades for the Republic of Korea Air Force. Defense, Space & Security achieved first flight of the MQ-25 unmanned aircraft with an aerial refueling store and demonstrated ski-jump launch capability of the F/A-18 Super Hornet for the Indian Navy. Also in the quarter, Defense, Space & Security completed engineering design review for the Wideband Global SATCOM-11+ communications satellite and critical design review of the Space Launch System Exploration Upper Stage for NASA.

Backlog at Defense, Space & Security was $61 billion, of which 32 percent represents orders from customers outside the U.S.

Global Services

Table 6. Global Services	Fourth Quarter			Full Year
(Dollars in Millions)	2020	2019	Change	2020	2019	Change

Revenues	$3,733	$4,648	(20)%	$15,543	$18,468	(16)%
Earnings from Operations	$143	$684	(79)%	$450	$2,697	(83)%
Operating Margin	3.8%	14.7%	(10.9) Pts	2.9%	14.6%	(11.7) Pts

Global Services fourth-quarter revenue decreased to $3.7 billion, driven by lower commercial services volume due to COVID-19 (Table 6). Fourth-quarter operating margin decreased to 3.8 percent primarily due to lower commercial services volume and $290 million of pre-tax charges related to asset impairments driven by COVID-19.

During the quarter, Global Services was awarded a Performance Based Logistics contract for the Republic of Singapore Air Force F-15SG fleet, secured a F-15 spares and logistics support contract with the Qatar Emiri Air Force, and was selected to provide P-8A training for the Royal New Zealand Air Force. Global Services also announced a 10-year digital services agreement with Frontier Airlines.

Additional Financial Information

Table 7. Additional Financial Information	Fourth Quarter		Full Year
(Dollars in Millions)	2020	2019	2020	2019
Revenues
Boeing Capital	$56	$37	$261	$244
Unallocated items, eliminations and other	$8	($163)	($65)	($503)
(Loss)/Earnings from Operations
Boeing Capital	$16	($58)	$63	$28
FAS/CAS service cost adjustment	$328	$322	$1,383	$1,415
Other unallocated items and eliminations	($1,390)	($342)	($2,355)	($2,073)
Other income, net	$122	$104	$447	$438
Interest and debt expense	($698)	($242)	($2,156)	($722)
Effective tax rate	2.2%	56.9%	17.5%	71.8%

At quarter-end, Boeing Capital’s net portfolio balance was $2.0 billion. The change in revenue from other unallocated items and eliminations was primarily due to the timing of eliminations for intercompany aircraft deliveries. Other unallocated items and eliminations included a $744 million charge related to the previously announced agreement between Boeing and the U.S. Department of Justice in January 2021. Interest and debt expense increased due to higher debt balances. The fourth quarter 2020 effective tax rate primarily reflects an additional valuation allowance on certain deferred income tax assets, partially offset by the benefit of the five year net operating loss carryback provision in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.