A new program for a clean-sheet airliner from Boeing is still “at least a couple of years” away from being formally launched as the airframer hones the digital tools it will rely on to differentiate the aircraft, Boeing CEO and President Dave Calhoun told an investor conference June 3.
“We have to develop and mature the tools so we have them,” Calhoun told the Sanford C. Bernstein Strategic Decisions Conference. “We’ve practiced them in several of our defense programs—some of which you see, some of which you don’t—and we’re very bullish about it.”
Calhoun said he had just reviewed the status of those digital tools the day before (June 2) with an integrated team and to discern what the maturity expectations are for them. He told Bernstein analyst Doug Harned it would be “at least a couple of years before I’m confident that those tools are tested and mature enough to implement on the next airplane.”
Boeing has long promised, through Calhoun’s tenure and his predecessor’s, that its next new airliner will be distinguished more for how it is digitally designed and manufactured, rather than as an envelope-pushing marvel of aviation advances. The company has several related efforts running, including the T-7A trainer for the U.S. Air Force, where so-called digital twinning, high-powered computer-aided design, automation and artificial intelligence are being used and/or built-in to the products. Recently, Boeing unveiled agreements with all three of the major cloud-computing industry leaders to move practically all functions, including aircraft design, into the cloud.
Still, the beleaguered company has faced loud calls to announce a new airliner program as a catalyst and rallying effort for itself and its supply chain to combat archrival Airbus’s growing market domination in producing—and currently delivering—new commercial aircraft. But Calhoun again asserted he was confident with Boeing’s plans to move forward and that its product line, including the 737 MAX and 787 widebody, will regain market share with customers as they roll out. He also reiterated that the digital aspects of the new airliner are essential, even more so than expected fuel efficiency gains.
“I don’t want to run forward until I get that,” Calhoun added.
Calhoun indicated the new airliner further would be differentiated on other, related achievements. “There are things you can compete on: sustainability will be one, readiness for sustainable fuels, etc., etc.,” he said, “and, the efficiency of the airplane itself: cockpit design and a major step toward, autonomy. A major step.”
The CEO reiterated that achieving advances in autonomy was what justified Boeing’s roughly $450 million additional investment in advanced air mobility startup Wisk, which was announced in January at a time that Wall Street was focused on whether Boeing would generate enough cash flow for shareholder returns. Overall Boeing has invested roughly $1 billion in Wisk.
“We don’t hesitate on the things that will matter to us,” Calhoun said. “There’s a whole lot of things about Wisk that are meaningful to us, not just a vehicle for helicopter displacement in urban markets and lots of markets around and/or local delivery services or whatever. It’s not just a use case. It’s autonomous from the word ‘go.’”
In other news, Calhoun ruled out a mid-term issuance of company stock in order to raise funds. He said the company will host an investor briefing event in September.
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The first step in the Boeing CEO succession planning is to get a new Chair of the Boeing Nomination Committee who is currently Ronald Williams. Mr. Williams greatest contribution to Boeing is that he provides insight into health insurance and employee benefits practices which is totally unrelated to succession planning at a major aerospace company.