Sky High: Boeing Rolls Out Dreamliner

Company expects a huge success that will reverse its fortunes.


July 7, 2007 — -- When Boeing rolled out its 787 Dreamliner Sunday in Everett, Wash., the public got its first look at a new plane that's already a success even though it has yet to fly.

More than 40 airlines and leasing companies have bought 640 787s -- the most ever for a plane before it enters service -- worth a tidy $100 billion. And if all goes well in mass production, Boeing will ride the Dreamliner back to dominance in civil aircraft manufacturing after more than a decade of turbulence at America's biggest exporter.

"There's a real feeling among the airlines that this is a revolutionary product that's going to transform the industry," says Richard Aboulafia of the aerospace consultants The Teal Group.

Aboulafia believes the plane marks a major technological change in the way a plane is made and the way it operates. Other analysts say it could be as important as Boeing's 707, introduced in 1958, which truly brought the jet age to passengers and allowed the public to fly longer distances in a shorter time. The 707 also made air travel affordable for the average passenger.

What makes the 787 revolutionary is that it is the first airplane built mostly not of metal, but rather mostly of high tech composite material, a type of reinforced plastic.

Mike Bair, the Boeing executive charged with bringing the 787 from the drawing board into the sky holds a model of the new plane and traces where Boeing has used composites for the first time.

"The whole structure of the fuselage," says Bair, "all the wings, the horizontal and vertical stabilizers, the nacelles that wrap the engines -- all composite."

In Boeing's massive Everett assembly building, workers maneuver four huge pieces of the fuselage, each about 19 feet in diameter. They are all plastic and then snapped together like a Lego toy. But unlike a Lego toy, this plastic will carry 250 passengers.

Bair quickly points out that this plastic is stronger than aluminum, traditionally used to make airplanes. With the super aerodynamic wing and new engines, Bair says airlines have bought so many because of two words -- operating efficiency.

"It will be the lowest operating cost per seat of any airplane flying," says Bair, "and in today's environment, with the business struggles airlines have, that's a big, big thing."

Its efficiency comes in large part from the composites. They are lighter than metal, which means the 787 will use 20 percent less fuel -- which means lower costs and less pollution. Boeing also promises dramatically lower maintenance costs because the plane has fewer parts and will experience less corrosion.

But what about the passenger? Boeing's mockups of the interior are roomy with bigger overhead luggage bins and bigger windows. The windows look straight out, not down. Bair says a Boeing study showed passengers wanted to look at the horizon, not down at the ground.

As for seat width and legroom, Boeing says that's up to individual airlines. Purchasers include Northwest and Continental in the United States.

But the biggest thing passengers are likely to notice is the atmosphere on board the 787 and how better it will make them feel on a long flight. And again, composite material plays a big role.

To prevent metal fatigue, conventional airlines must be pressurized at 8,000 feet, creating dry, thin air. Humidity is kept purposefully low to prevent corrosion. But plastic changes all that. The Dreamliner will have more oxygen in the cabin, more humidity and will be pressurized at a lower altitude.

"So the dryness, the fatigue you feel at the end of a flight won't be there," says Bair.

Boeing invested $8 billion in developing the 787, betting airlines and passengers would want a medium-sized plane that can fly between almost any two cities on Earth, bypassing congested hubs.

Boeing's competitor, Airbus, bet more than $12 billion that passengers would want a super jumbo plane, the A-380, operating between the world's biggest hubs. A-380 sales were stuck for months below 170. Only 14 airlines have bought the big plane and the only two U.S. purchasers, FedEx and UPS, cancelled their orders for a cargo version. And delivery of the A-380, plagued by production problems, is two years behind schedule.

Bair is asked if Boeing had the right strategy, Airbus the wrong one.

"We were righter than they were," he says.

Clearly, the Dreamliner has given Boeing new life.

Twelve years ago, Boeing seemed in a tailspin that might cause it to drop the commercial aircraft business. There were serious production problems and problems with the quality of some aircraft coming off the manufacturing line. There was scandal and the abrupt departure of two chief executives. Boeing's market share in a two-manufacturer market slipped to 45 percent. And for five years, Boeing has delivered fewer planes than Airbus.

But now, Airbus finds itself five years behind Boeing in the development of a competitor to the 787, and the Dreamliner has Boeing poised to regain the number one position in the all important "planes delivered" category.

"I'm hard pressed to think of many other manufacturers that were down for the count," says The Teal Group's Aboulafia, "and all of a sudden turned it around, invented a new killer product and basically staged a huge market comeback."

It took more than the 787. Boeing, according to analysts, reinvented the way it did business.

A principal example is that the risk of building the Dreamliner has been shared with other U.S. manufacturers and companies in places like Japan and Italy. Instead of doing all the work at Everett, Boeing's partners prefabricate components and ship them to Washington where they are assembled. It takes just three days to assemble a 787, compared with 18 days to assemble the 777.

"Assuming the 787 works out as planned and arrives when intended," says Aboulafia, "then Boeing's going to have two thirds of the market in a couple of years."

Japan's ANA is the first airline scheduled to fly the 787 in May of 2008.

Some analysts worry that Boeing could face production problems. Recently, some composite parts did not fit together as they should have and the company has faced a shortage of titanium fasteners need to "snap" pieces together.

But Boeing executives say those problems and solved and Boeing employees say Detroit's beleaguered carmakers could learn from the airplane maker.

As production engineers Brennan Dunlap and Don Bryant take a break from overseeing the assembly of the first Dreamliner, they praise executives who managed the turnaround.

Says Dunlap, "They did what is very hard for a company to do: predict where the customers will be before the customers know it. I think Boeing did that."

Adds Bryant, "It's an incredible machine, it really is."