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To affirm that the airplane is going to revolutionize the future is to be guilty of thewildest exaggeration

Scientific American Magazine, 1910

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Commercial Aircraft Industry -

Market Drivers• Market demand for large planes

 – 777 filled Boeing’s need for plane sized between 767 and 747

 – DC-10, L-1011, and early versions of 747

- aging aircraft needing replacement

 –  Needed to fit existing airport

infrastructure

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Market DriversSeat category Models

 Intermediate twin-aisle: 230-310 767, A300, A310, A330-200

311-399 A330, A340, MD-11

747 and larger: 

>400 747, 747X, A3XX

777 filled this need 

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Market Drivers• Increased globalization and travel

 – Higher demand for comfortable, practical

 business travel due to globalization

 – Increased market demand for long-haul flights

 – Boeing had to anticipate types of airplanes

needed in the future

 – Developing countries and emerging markets,

especially Pacific Rim and Latin America

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Market Drivers• Competition

 – Airbus Industrie - consortium subsidized by

British, French, German, and Spanish

governments

 – McDonnell Douglas MD-11

 – Competing models in seat capacity category(311-399 seats): MD-11, A-330, A-340

 – Boeing needed new plane to compete with

other new products, vs. extending 767

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Market Drivers• Plane design specifications

 – Airlines found fault with cabin widths of

competitors

 – Configuration flexibility

 – Carriers such as United, American, All Nippon

Airways, British Airways, Japan Airlines, and

Cathay Pacific helped define 777 configuration

 – Reduced variability in design and production,

leads to reduced costs

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Market Drivers• Cost Drivers

 – Labor - maintenance and operations

 – Fuel - reduced importance but still significant

• Aircraft Economics

 – Fly-By-Wire eliminates need for flight engineer

 – Twin engine planes are more efficient - lowerfuel and maintenance costs

 – 777 reliable enough for transoceanic flights

 – Lower customer financing costs

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Why “paperless” paradigm shift? • Slow, arduous, and frustrating design &

manufacturing process

• Technology available

 – 767 Engine strut (save time & costs)

 – Digital flight control (Airbus “fly-by-wire”)  – U2 Spy & Stealth (successful design teams)

• Lower costs (minimize errors & rework)

• Risky venture

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Design & Production Software• CATIA (Computer-Aided 3D Interactive

Application) - Dassault, IBM

 – ELFINI (Finite Element Analysis System)

• Solve linear elasticity & thermal problems

• EPIC (Electronic Preassembly Integration)• Check for interference in sub-assembly

 parts

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Hardware & Network• 1700 WSs (Puget Sound), 7000 worldwide

• 8 of IBM’s largest mainframes (4 - Puget

Sound, 4 - worldwide)

• Linked by dedicated cable under Pacific

Ocean

• Storage capacity - 3.5 terabytes

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“Fly-by-Wire” • Computerized Flight Control

 – Twisted pair vs steel cables

• Limitations Overcome

 – Pilots in control

 – Pilots “feel” airplane • Replaced Display Units

 – CRT with flat-panel, full color LCD

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CATIA• Developed by Dassault

• Alliance with IBM

• Applications to multiple industries

• UNIX and Windows NT

• Modular, scalable• Dassault also a competitor of Boeing

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Shorter Development Time,

Improved Quality, Lower Cost• Concurrent development in more than 17

time zones

• E-mail and privacy concerns

• CATIA, ELFINI, EPIC, CLASH

• Suppliers’ proprietary software • Suppliers’ acceptance of CATIA 

• Component integration; tolerances

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Japanese supplier consortium• Mitsubishi Heavy Industries, Fuji,

Kawasaki

• Fuselage development

• Dedicated trans-Pacific data cables

• Shared investment costs• Promoted airplane purchases by Pacific Rim

airlines

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IT: Engine Design, Integration,

and Performance• Pratt & Whitney (PW4000), Rolls Royce

(Trent 80), GE/SNECMA (GE90)

• Airlines select engines

• FAA certification process shortened

• GE90: IT leads to performance gains,increased reliability increased sales

• Complete engine simulations: The cutting

edge of technology

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IT Tools & Intellectual Capital

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Impact - People

• Boeing Employees

 – Increased Communication

 – Team approach

 – Decreased Bureaucracy

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Impact - People

• Customers

 – Boeing’s customer service goal 

 – Customer integration into design process

 – Passenger satisfaction

 – Customization – Flexible purchase arrangements

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Some of 777’s Major Customers • American Airlines

• British Airways

• Cathay Pacific Airways

• Continental

• Delta

• Emirates

• Korean Air

• Lauda Air

• Malaysia Airlines

• United

• Varig 

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Airplane Design Process

THEN (after WW II)  NOW(after 1990)

• Make paper drawings

& full-scale mockups

• Test fly to discover

 blunders

• Write maintenance

manuals last

• Paperless, e-mockups

• Computer simulation

removes bugs

• Mechanics involved

throughout

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Impact of Design Process

• Saves Boeing time and money

 – Easier design process

 – Improved accuracy

 – Reduced production costs

• More time for testing• First-mover advantage

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Market Outlook

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Market Outlook

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Market Outlook

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Future Issues

• Asian Crisis

 – Asian demand originally drove the

development of the 777

 – Short-term Asian demand has dropped

 – Offset by long-term growth prospects indemand for airplanes

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Future Issues

• Competition

 – Replication -- Can Airbus copy this

technology?

 – Response

• Price competition (easier due to subsidies)• Design innovations

• US vs. EU dichotomy

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Future Issues

• Spillover applications

 – CATIA modeling used for:

• other civil aircraft

 – 737-NG uses innovative production and

 planning techniques learned on 777

• military aircraft• the space shuttle

 –(“because it’s in the direction of goodness”) 

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Questions?