The Coronavirus pandemic is causing havoc not just from the appalling death rate – but vital industries like the airlines and airline manufacturers are suffering.
Earlier this week, the WSJ reported that to get through the COVID-19 crisis, Boeing is looking to tap into private financing in order to avoid possible conditions that will likely come with any significant federal assistance, such as a Federal equity stake, which CEO David Calhoun is against. However, one other idea is for Boeing to ask the Treasury to buy X billion dollars of its bonds and get the rest from private banks and buyout firms.
A few days later New York Times reported that the Trump administration has reached an agreement in principle with major passenger airline companies for a $25 billion bailout as part of the $2.2T Coronavirus Aid, Relief, and Economic Security (CARES) Act. This will come in the form of grants and loans to pay flight attendants, pilots, and other employees. It is thought that a proportion of these grants and loans will need to be repaid and/or require company stock warrants.
Device Technologies, Inc. – Two Recommendations for Boeing’s Next Steps
DTi is admittedly only a small cog in the Boeing wheel; however, we understand the impact of manufacturers and industries being shut down as our own supply chain has been disrupted, and we have had to scramble to keep producing as a designated essential industry supplying aerospace, medical and IT. The economic limbo is causing significant damage. All any of us can do is to plan for the recovery. The country and DTi need Boeing to be strong and to recover quickly.
In light of that, we have two recommendations or suggestions for Boeing:
1) Push the certification of the problematic B-737MAX into overdrive.
Even limited or provisional certification could work as Boeing and the airlines would be able to operate the Max under a limited and stringent set of conditions. This would open up the possibly for Boeing to make deliveries and book much needed sales revenue. This will shift some of the financial burden to the airlines; however, they still have a significant revenue stream from air freight services as well as the bailout loans mentioned above. Sounds simple, and almost certainly isn’t, but we have to be working back toward normalcy.
2) As always, cash is king. Boeing needs to conserve precious cash-flow and net working capital. DTi strongly recommends taking this time to look for cost reductions in the manufacturing environment generally – including components and flow time in order to meet the likely aggressively scheduled contractual deliveries.
We are doing that in our own situation but can offer Boeing a component that will make a contribution. DTi proposes that Boeing and its subcontractors like Spirit use Spring-Fast® – its best-in-class EWIS protection grommet edging – not just at the current select platform locations but for all EWIS /airframe interfaces.
Spring-Fast will save at least 49% of current install costs and significantly reduce process and handling time while still providing best-in-class performance.
It replaces the old legacy glued nylon grommet BACG20Z (outside Boeing known as MS21266) which requires multiple steps and handling. Spring-Fast, however, dry installs in a matter of seconds with just finger pressure – no glue/fixturing/cleanup or VOCs – and holds fast even when subjected to 20G crash loads.
Wires, cables, and fluid lines pass through as many as 350-500 air frame penetrations per aircraft – the cost and time savings would seem to make it an obvious choice.