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  • Dreamliner 787: Alicia Sanchez, Phi Anh Tao, Trung Tran

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    This document discusses Boeing's production plan for its 787 Dreamliner aircraft through 2026. It outlines a three-stage solution: 1) maximize production at its Seattle factory by adding more workers and a second shift, 2) add a second shift to its South Carolina factory starting in 2017, and 3) form strategic alliances with suppliers to outsource some production while maintaining control. This will allow Boeing to increase total production capacity from 6 aircraft per month currently to 15 per month by 2026 to meet growing demand. It projects that this plan will save $4 billion compared to operating at full three shifts in both factories.

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    Dreamliner 787 Boeing

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    Dreamliner 787

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    This document discusses Boeing's production plan for its 787 Dreamliner aircraft through 2026. It outlines a three-stage solution: 1) maximize production at its Seattle factory by adding more workers and a second shift, 2) add a second shift to its South Carolina factory starting in 2017, and 3) form strategic alliances with suppliers to outsource some production while maintaining control. This will allow Boeing to increase total production capacity from 6 aircraft per month currently to 15 per month by 2026 to meet growing demand. It projects that this plan will save $4 billion compared to operating at full three shifts in both factories.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    18 views19 pages

    Dreamliner 787: Alicia Sanchez, Phi Anh Tao, Trung Tran

    Uploaded by

    Viet Trung
    This document discusses Boeing's production plan for its 787 Dreamliner aircraft through 2026. It outlines a three-stage solution: 1) maximize production at its Seattle factory by adding more workers and a second shift, 2) add a second shift to its South Carolina factory starting in 2017, and 3) form strategic alliances with suppliers to outsource some production while maintaining control. This will allow Boeing to increase total production capacity from 6 aircraft per month currently to 15 per month by 2026 to meet growing demand. It projects that this plan will save $4 billion compared to operating at full three shifts in both factories.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 19

    Dreamliner 787

    Alicia Sanchez,Phi Anh Tao, Trung Tran

    Dreamliner 787
    800

    160

    6%

    backlog

    aircrafts

    growth rate

    Production LevelRequirements
    2014
    2015
    2016
    2017
    2018
    2019
    2020

    48 aircrafts
    60 aircrafts
    64 aircrafts
    67 aircrafts
    71 aircrafts
    146 aircrafts
    150 aircrafts

    2021
    2022
    2023
    2024
    2025
    2026

    155 aircrafts
    160 aircrafts
    166 aircrafts
    171 aircrafts
    177 aircrafts
    177 aircrafts

    Solution Stages
    1
    Maximize Seattle's
    Second Shift to
    Capacity

    2
    Add SecondShift
    to Charleston,SC

    3
    StrategicAlliance

    1. Maximize Seattle
    Second Shift toCapacity

    1. Seattle, WA
    Only Seattle for 2015 - 2016
    400 additional productionworkers
    100 additional engineers
    Production required:
    2015 - 5/ month
    2016 - 5/ month from Jan. to Aug. & 6/ month from Sept. to Dec.

    2. Add Second Shiftto


    Charleston, SC

    2. Second Shift at Charleston, SC


    2017 - 2018: 108 workers, 25 management, and 25 engineers
    2 planes/ monthcapacity
    Starting 2019: 375 workers, 50 management, and 50 engineers
    3 planes/ monthcapacity

    3. Strategic Alliance

    3. Strategic Alliance
    Invest in two suppliers expansion
    Suppliers compete for best production proposal
    Reward price: $ 60 million and $ 40 million
    Investment in return for an equity
    Production starts2018
    First deliver to Boeing in 2019

    3. Strategic Alliance -Benefits


    50% in-house / 50% outsource for supplies
    70% in-house / 30% outsource for assembling
    More control in the operations of the supplier
    Decrease lead time andcosts
    Increase efficiency
    3 aircraft/ month per supplier

    Total Production Capacity


    2015 - 2016 6/ month (72/ year)
    2017 - 2018 8/ month (96/ year)
    2018 - 2026 15/ month (180/ year)

    Production LevelRequirements
    2014
    2015
    2016
    2017
    2018
    2019
    2020

    48 aircrafts
    60 aircrafts
    64 aircrafts
    67 aircrafts
    71 aircrafts
    146 aircrafts
    150 aircrafts

    2021
    2022
    2023
    2024
    2025
    2026

    155 aircrafts
    160 aircrafts
    166 aircrafts
    171 aircrafts
    177 aircrafts
    177 aircrafts

    Cost Benefit Analysis


    2 Shifts at Capacity and S.A.

    3 Shifts at Capacity for Both Factories

    SalesRevenue $ 23,319,778,816
    Total Cost
    $ 16,549,416,965

    SalesRevenue $ 23,319,778,816
    Total Cost
    $ 20,793,024,000

    Income

    6,770,361,851

    VS

    Net Income

    2,526,754,816

    Financial Summary
    Total Revenue
    Total Cost

    $ 259,651,455,733
    $ 192,095,408,176

    Net Income

    $ 67,556,047,557

    LEAN

    Is the solutionlean?
    Eliminate extra aircraft over a long period of time
    Reduce labor costs
    Collaborative relationship with suppliers
    Avoid problems with finding new suppliers

    Review
    Seattle - maximize second shift to capacity starting 2015
    Charleston - utilize starting2017
    2017 - 2018: 2 aircraft/ month
    2019 and beyond: 3 aircraft/ month
    Strategic alliance - first delivery in 2019
    In-house: fixed production per year of 108 aircraft
    Suppliers: fill in the difference
    Approximately save $ 4 billion (63%)

    Dreamliner 787

    Alicia Sanchez,Phi Anh Tao, Trung Tran

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