Farnborough Air Show

Conner: Boeing Won’t Ease Off 777X, 787-10X

 - July 9, 2012, 7:29 PM

Boeing Commercial Airplanes CEO Ray Conner took to the podium for the first time yesterday as BCA boss and, in the process, laid to rest any thought that the company has been dragging its heels on follow-on development of the 787-10X and 777X.

“We’re not backing away from the airplanes one bit,” said Conner. “We’re more committed now than ever. We just don’t want to get into specifics…When we get the aircraft right we’ll move forward.”

If yesterday’s briefing carried any sort of theme, it would probably be that it’s “business as usual.” Having suddenly replaced Jim Albaugh as head of BCA a little more than two weeks ago, Conner takes control at a critical time for Boeing as it prepares for ambitious production rate increases among virtually its entire line of products, while also accelerating development of the re-engined 737NG (the 737 MAX) and readies to take decisions on the potential launch of the 787-10X and 777X.

Conner acknowledged the challenges he faces, not least of which is raising the production rate of the 787 from 3.5 to 5 a month by the end of the year and to 10 a month by the end of 2013. He credited improvements in Boeing’s own production processes and those within the supply base for his stated confidence that the company will achieve its goal.

“The production system is healthier,” he said. “We’ve just delivered the first aircraft–Line number 66–from the factory directly to the delivery center.” Conner quoted a “near 100 percent” product execution among its suppliers, leading to improvements in production flow at its main Everett plant near Seattle and good progress toward reducing the number of airplanes where design changes were being incorporated.

In choosing Conner, Boeing has turned to a 32-year company veteran known for both his technical acumen and his sales prowess. Widely credited for landing a groundbreaking, $21.7 billion order for 737s from Indonesia’s Lion Air while serving as the company’s senior vice president sales and customer support, Conner previously led BCA’s supply chain management and operations organization, which included overseeing development of Boeing’s new production and assembly facilities in South Carolina.

The new BCA chief executive also played a critical role in reaching a landmark labor agreement with the International Association of Machinists, the importance of which he left little doubt during yesterday’s briefing. “It’s working out very well,” he said. “We’ve implemented an incentive plan tied to production gains…Hopefully because the agreement is longer [than the duration of past contracts], we’ll be able to create more of a culture of working together.”

Conner joined Boeing in 1977 as a mechanic on the 727 program. He worked his way through the company’s ranks to become vice president and general manager of the 777 and 747 programs before accepting the post of vice president of sales for the Americas and Asia Pacific regions and, later, vice president of sales for all of BCA.

Albaugh’s Legacy

While the official word from Boeing suggests nothing other than a completely voluntary departure by the 62-year-old Albaugh, his immediate replacement with Conner at least seemed abrupt, if not curious. An engineer by training, Albaugh assumed control of BCA from Scott Carson in 2009 at the nadir of the company’s reputation for technical excellence. Only a week earlier, Boeing announced yet another schedule change for the 787, at the time already more than two years late, while the 747-8 suffered through its own set of travails due, in part, to a shift in engineering resources to the ultra-high-tech, but troublesome, Dreamliner.

When Albaugh moved to BCA from Boeing’s military division, he promised to restore an engineering-centric culture undermined in preceding years by what some might consider a clumsy effort to run the company more as a product “integrator” than a manufacturer. Reasonable people may argue over whether or not he succeeded, but the certification on his watch of the 787 and 747-8 at least staved off an erosion of credibility suffered with each missed program deadline.