Boeing: With 787 almost ready, it's time to harvest R&D efforts

Boeing is set up to harvest its research and development efforts such as its Phantom Ray hydrogen-powered drone that can stay aloft for four days and its 787 Dreamliner, which should yield derivative planes for the years ahead.

That's the message from Boeing CEO Jim McNerney, who was speaking at a Sanford Bernstein conference Thursday.

McNerney acknowledged that Boeing has had some rough spots---especially with the 787 production, which was delayed. Now the 787 is ready for deliveries in the months ahead, McNerney sounds like a man with the worst behind him. To wit:

  • He touted a potential plane based on the 787 technology.
  • Boeing is feeling good about the defense business even amid budget cuts. In April of this year, we flew our fighter-sized Phantom Ray (top right) unmanned demonstrator aircraft. Later this year, our high-altitude long-endurance Phantom Eye surveillance plane will make its first flight. Phantom Ray, by the way, is hydrogen powered and will stay aloft at 65,000 feet for up to four days," he said. "These investments in innovation and technology are all about future growth, despite the current budget pressures."

McNerney said Boeing now has visibility into the technical hurdles with the next plane it builds because it has worked through the issues with the 787. He added:

We are dealing with technology that we have already used to develop an airplane. This is a matter of taking technology we used on the 87, where we went to hell and back getting it done. Now that we have done it, it is a matter of -- not yet inventing another whole new way of building an airplane; rather, slipping into a new application those hard-fought technologies that we finally got through on the 87. So the technical risk is a lot lower than it would be on an 87 kind of development. And the 87 is the way we are going to be building airplanes for the next 60 years.

Indeed, the 787 is nearly sold out through 2019.

McNerney said that Boeing is studying right now to see if it needs to build a new plane in 2019 or 2020. To build that plane, Boeing would need to launch plans in 2014. Much of the lessons from the 787 would be used on additional planes.

Why does Boeing have to be ahead of the innovation curve? McNerney said that he has one eye on China and Comac, a future threat to Boeing. McNerney said Comac is a "legitimate effort" and will be real competition at some point either this decade or next.

"This is one of the reasons we have got to keep innovating. Refurbishing an airplane when we can build an all-new one, we have got to be mindful that a Chinese airplane is going to be around, if not this decade, the next decade. It's pretty competitive. But they will get there," he said.


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