Cost control on the Boeing 787

Cost control on the Boeing 787 programme showed some improvement on a unit basis in the first quarter, but the company remains far from break-even.

If deferred production, unamortised tooling and other costs are factored in, Boeing lost an average of $30 million on each of the 30 787s delivered in the first quarter.

That represented an 11% decline from a $34 million unit loss on each of the 35 787s delivered in the fourth quarter of last year.

Boeing still plans to reach break-even on a unit basis by the end of this year on the 787 programme.

“The programme continues to make improvements on unit costs,” Greg Smith, Boeing’s executive vice-president and chief financial officer, said in a first quarter earnings call with analysts on 22 April. “We’ve still got a long way to go, but we’re making a lot of progess.”

The unit accounting losses on each 787 do not show up directly on Boeing’s quarterly balance sheet.

Instead, Boeing’s programme accounting method defines a block 1,300 aircraft expected to be delivered and builds in a predetermined cost and operating margin for each aircraft delivered within the block.

Actual losses on each aircraft delivered so far are added to the programme’s deferred production cost. Boeing also has a separate line item for unamortised tooling and other costs.

The combined deferred production and amortised tooling costs rose by $905 million in the first quarter to exceed $30 billion.

Although overall costs are still rising, the first quarter represented the first three-month period that the figure was held under $1 billion since Boeing started delivery 787s in the fourth quarter of 2011.

The unit cost improvement in the first quarter could have been greater if not for supply chain problems. Zodiac Aerospace has fallen behind on deliveries of premium cabin seating. GE Aviation also discovered a quality problem with a component that delayed shipments of 29 GEnx engines. Both issues are expected to be resolved in the second quarter.

“We do have a high confidence in the plan to resolve” the Zodiac seat issues, says Boeing chief executive and chairman James McNerney. “”It’s not going to disrupt our production plans.”

A400M crashes on take-off from Seville airport

An Airbus A400M airlifter crashed shortly after take-off on 9 May from the San Pablo Airport inSeville, Spain, according to reports.

Airport officials tweeted that the airport was closed as firefighters attended to an accident beyond the facility’s enclosure. Spain’s prime minister also reportedly confirmed that an A400M crashed, killing a crew of eight to 10 people on board.

Pictures of the accident scene on social media located the wreck about 1nm (1.9km) north of the airport near a Coca Cola facility.

That would place the crash site on a direct bearing with diagonal runway at San Pablo airport, but it is not known which runway was used by the A400M for take-off.

The crash marks the first fatal incident involving the A400M in the programme’s 5.5-year flight history.

It comes as Airbus has recently restructured the programme following a series of production delays. In January, Airbus replaced the head of the military division that produces the airlifter with Fernando Alonso, formerly head of flight test operations. One month later, Airbus announced taking a €551 million ($620 million) fourth quarter charge due to the production problems.

American inaugurates 787 in latest step of fleet renewal

American Airlines introduced its first Boeing 787-8 between its Dallas/Fort Worth and Chicago O’Hare hubs today, the latest in a string of new aircraft types at the US mainline carrier.

Flight AA2320, the Fort Worth, Texas-based Oneworld Alliance carrier’s first revenue Dreamlinerflight, departed Dallas/Fort Worth International airport at 07:31 local time bound for Chicago O’Hare International airport with a water cannon send off.

The 787 operating the first flight (registration N801AC and MSN 40619) is one of five that American has taken delivery of since January. It was delivered in February.

“This is really is just another testament to what American is becoming,” says Fern Fernandez, vice-president of global marketing at American, ahead of departure at the gate in Dallas. “The 787 represents the transformation that’s happening at American…the fact that we have the youngest fleet in the industry right now and we’re taking two new airplanes a week this year.”

The airline anticipates having 13 787-8s in its fleet by the end of 2015, many of which will replace older Boeing 767-200ERs and 767-300ERs that are being retired. It plans to remove 13 767s this year.

“American is now the first carrier to take delivery of all of Boeing’s jets that have ever been built, from the 707 all the way to the 787,” says Al Smolinski, sales director for the Americas at Boeing Commercial Airplanes, at the event.

The 787 introduction is the latest in a string of new aircraft types for American. The carrier’s legacy operation, including regional, has introduced the Bombardier CRJ900 in August 2014, the AirbusA321 in January 2014, the Airbus A319 in September 2013, the Embraer 175 in August 2013 and the Boeing 777-300ER in January 2013.

“It’s a phenomenal fleet renewal programme,” says Fernandez.

American will add 787 international service in June. The aircraft will replace a Boeing 777-200 on flights from Dallas/Fort Worth to Beijing on 2 June, to Buenos Aires on 4 June and to ShanghaiPudong on 26 June.

The 787 will take over the carrier’s flights between Chicago O’Hare and Tokyo Narita on 19 August.

“It’s just a perfect airplane for the type of rotation that we do here in Dallas between Asia and South America,” says Fernandez.

American has outfitted its 787s with 226 seats, including 28 lie-flat business class seats, 57 extra legroom economy seats and 141 economy seats. This compares to the 260 seats on its 777-200s and 209 seats on its 767-300ERs.

American is the second US carrier after United Airlines and fourth in North America after Aeromexicoand Air Canada to operate the 787.

The airline has firm orders for 16 more 787-8s and 21 787-9s with deliveries through 2018, the Ascend Fleets database shows. It has options for another 58 aircraft.

The atmosphere was jovial on the inaugural flight to Chicago, as the majority of passengers were onboard primarily to experience the aircraft, rather than to get to the Windy City. Passengers milled about during the flight, checking out the premium cabin and new features on the Dreamliner.

AA2320 arrived 4min early at 09:23 local time in Chicago.

FAA orders new 787 electrical fix to prevent power failure

All Boeing 787 operators will be required to periodically deactivate the electrical system to avoid a problem with a newly-discovered software bug that could cause the aircraft to lose alternating current (AC) power, the US Federal Aviation Administration says in a new airworthiness directive.

The agency adopted the final rule after Boeing reported the results of a laboratory test showing a total loss of power is possible if the generator control units run continuously for eight months, says the FAA’s 30 April notice in the Federal Register.

The binding airworthiness directive is being published less than two weeks after Boeing privately alerted operators about the problem, the company says in a statement to Flightglobal.

It is rare for a commercial aircraft to remain powered on for eight months with no interruptions.

So far, no 787 operator has experienced the software problem that causes four onboard generators to stop working at the same time, Boeing says.

Boeing is working on a software update to fix the problem that should be ready in the fourth quarter, the company says.

The 787 relies on electric power more than previous commercial aircraft. In addition to powering onboard avionics, the 787’s electrical generators also are used to pressurise the aircraft cabin and de-ice the leading edge of the wing.

Two 250kVA generators are installed on each of the 787’s pair of turbofan engines. Another two back-up generators each rated at 225kVA are connected to the auxiliary power unit. If all six generators fail at the same time, a lithium-ion main battery keeps power running to the flightdeck systems for about 6s until a ram air turbine can deploy and begin generating enough power to help the pilots navigate while attempting to restart the engines or glide to an unpowered – or “dead-stick” – landing.

All six power generating systems are managed by a corresponding generator control unit (GCU). Boeing’s laboratory testing discovered that an internal software counter in the GCU overflows after running continuously for 248 days, according to the FAA. The overflow causes all four GCUs on the engine-mounted generators to enter failsafe mode at the same time.

The software overflow problem is the latest in a string of reliability bugs to surface in the 787’s electrical system. The FAA grounded the 787 fleet for four months in 2013 after two batteries overheated, leading to a redesign of the battery system installation. Last June, the FAA approved an exemption to allow the 787-9 to enter service on schedule despite a substandard reliability record on the GCU for the RAT. The agency approved the exemption because it was deemed extremely improbable that all six power generators on board could fail at the same time.

A redesigned RAT was cut into the 787-9 production line on schedule in February and Boeing is continuing to retrofit previously delivered aircraft, a company spokesman says.

OBITUARY: Maurice Flanagan, the expat who helped Emirates take over the world

Maurice Flanagan, who has died aged 86, caught the Dubai bug when he arrived on a two-year secondment to run the city’s airport and travel operator Dnata in the late-1970s. “Everything looked so promising that I decided to stay,” he recalled two decades later. By taking up the royal family’s invitation in 1985 to launch an upstart state-owned airline called Emirates, the expat Englishman helped change the shape of aviation and ensured his place in the industry’s history.

He retired from the Emirates Group in 2013, as executive vice-chairman, after 35 years of helping to take the carrier from two rented aircraft to one of the biggest widebody fleets in the world. Although he stepped back from an active role in the business in his late 70s, he was still very much a face of the brand, defending Emirates in an interview with Airline Business in 2005 from accusations of unfair subsidies (back then, not from the Americans, but the airline’s now-partner Qantas).

A former Royal Air Force officer, Flanagan was already an industry veteran when he came to Dubai, having worked in the UK and abroad for British Airways predecessor BOAC. At that time, the Al Maktoums were busy trying to turn Dubai from a dusty trading port into a thriving metropolis of tourism and commerce by opening the economy with free trade deals and an open door to workers from all over the world– attracting tens thousands of waiters, construction workers and taxi drivers as well as seasoned professionals like Flanagan.

Air links were crucial to the strategy to create a global hub, and the government first tempted Gulf Air– then partly-owned by Dubai’s richer neighbour Abu Dhabi – to begin services during the 1970s. The city’s tiny airport was expanded as passenger numbers soared to two million in 1978. However, Gulf Air’s decision to cut its Dubai services in the mid-1980s, persuaded the Al Maktoums to launch their own airline with two aircraft, a leased Boeing 737-300 and an Airbus A310, and $10 million working capital. With Gulf Air dominant in the region, it was an incredibly audacious move.

With one or two blips, the first decade went swimmingly, with the airline averaging a 30% increase in passengers each year. When that began to settle down to around 12%, there were jokes that the recession had begun, Flanagan recalled. One of the boldest moves the Al Maktoums made was to allow all foreign carriers unfettered access to the airport. The open skies policy meant Flanagan and his team had to be extra sharp to compete, but it contributed to the emergence of Dubai as a crossroads of the world.

As the airline became more successful, increasingly adding services to Europe and North America from the turn of the century, Flanagan spent much of his time in interviews explaining the phenomenon that was Emirates and its relationship with the wider statelet. Although the carrier enjoyed the support of the royal family and contributed as well as benefited from the growth of Dubai, it was consistently profitable and contributed rather than took funds from the state.

“The only advantage we have is that we established an airline on a greenfield site. We are not lumbered by baggage,” he said in 2005. Attacks from rival airlines he attributed, quite simply, to “jealousy”. By the time Flanagan took a back-seat role as executive vice-chairman in 2006, Emirates had become one of the biggest brands in aviation and the largest customer for the Airbus A380, with 90 of the superjumbos on order.

Flanagan, who was born in 1928 in Leigh Lancashire, and had a degree in history and French fromLiverpool University, died of natural causes at his home in London. The man he launched Emirates with, Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive of Emirates Airline and Emirates Group, said in a statement:“Maurice was a man of great character, and a legend in the aviation industry.”

An-178 transport makes 1h debut flight

Antonov on 7 May conducted a first flight with its An-178 transport, just three weeks after it staged a roll-out ceremony for the type in Kiev.

Two test pilots and one flight test engineer were aboard the twinjet for its 1h debut, says Antonov. The aircraft carries the registration UR-EXP.

"The crew reported on a successful flight task realisation," the company adds in a brief statement about the milestone event.

A further development of the An-148 regional airliner, the An-178 is intended to perform transport tasks for civilian and military customers. With a rear ramp, it is expected to be capable of carrying up to 18t of cargo.

Antonov confirms 10 transports as being on order from launch customer Silkway Airlines, "as well as a protocol of intent" with the Chinese company Beijing A-Star Airspace and Technology. The Chinese partners have expressed their intention to purchase two An-178s, and to also consider the prospect of Ukrainian construction of a "transporter in China", says the airframer.

The An-178 is designed to replace aged transports including the An-12, An-26 and An-32. Antonov estimates that the need for aircraft in the new type's segment totals 200 units by 2032 is 200.

French air traffic controllers were unaware of highly-unusual altitude selections

French air traffic controllers were unaware of highly-unusual altitude selections being made on the ill-fated Germanwings Airbus A320 during its prior flight to Barcelona.

Investigators recently disclosed that, during its initial descent towards Barcelona, the altitude selector was dialled to extreme settings – including 100ft and 49,000ft – during a short period when the captain was out of the cockpit.

At the time the aircraft was some 40nm north of Perpignan, heading south towards the eastern Pyrenees mountain range.

It had been cleared to leave its cruise altitude of 37,000ft and French investigation authority BEA says the first officer initially correctly selected 35,000ft and activated the descent by pulling the altitude-selector knob.

This engaged the ‘open descent’ mode which remained active when he subsequently selected an altitude of just 100ft.

Later in the descent there were periods when the mode switched to ‘vertical speed’, the investigating authority tells Flightglobal. But it adds: “The aircraft’s actual descent path was normal.”

The altitude selections changed several times during the captain’s absence, being set as high as 49,000ft before being dialled to the cleared level of 21,000ft and then set to 100ft again for almost the entirety of a 2min period.

It was eventually reset to 25,000ft just before the captain re-entered the cockpit. At this point theA320 was descending through an altitude of about 27,000ft.

Selected altitude is one of the parameters chosen for downlink to air traffic control under Eurocontrol’s enhanced-surveillance concept using Mode-S radar, and is intended to give controllers greater clarity on aircraft intent.

But controllers at the Bordeaux en route centre, which was handling the Germanwings flight, had no knowledge of the activity in the cockpit.

All French civil radars are compliant with Mode-S but BEA says that no Mode-S information is shown yet on French controllers’ stations.

“The changes of selected altitude [on the Germanwings aircraft] were therefore not displayed to the controller in Bordeaux,” it adds.

Display of Mode-S information will be implemented as part of the 4-Flight programme undertaken by French air traffic authority Direction des Services de la Navigation Aerienne.

BEA says the Germanwings aircraft landed uneventfully in Barcelona a little over 30min after the captain returned to the cockpit. During the subsequent flight back to Dusseldorf, it states, the first officer "intentionally" adjusted the altitude selector to 100ft while the captain was out of the cockpit, allowing the A320 to enter a descent and eventually strike terrain with the loss of all 150 occupants.