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| Boeing Commercial
Airplanes: Running a |
| great business and
supporting our customers |
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| Refining our continuous
moving line processes for final assembly of the 717,
737 and 757, we plan to extend these innovations to the
747, 767 and 777 assembly lines in 2003. |
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We continue to restructure Boeing Commercial Airplanes
to improve competitiveness and ensure profitable performance
throughout our business cycles. Despite reducing airplane
production rates by more than 50 percent to match market
demand, we aggressively managed our cost structure during
2002 and delivered 381 airplanes with solid earnings.
We also helped our customers by rescheduling future deliveries.
In our 75th year in commercial aviation, we delivered our 1,000th
757, 1,300th 747 and 100th 717. We also delivered our first 747-400ER (Extended
Range) passenger and freighter models and rolled out the 777-300ER model. Our
Commercial Aviation Services business continued to improve its performance while
providing around-the-clock support to a worldwide fleet of 12,000 Boeing airplanes
and 800 operators. The services unit streamlined work processes to reduce cost
and increase efficiency, and integrated supply chains with inventory-management
services for improved customer service. We also acquired full ownership of our
joint training venture with FlightSafety International, which we renamed “Alteon.”
While order totals were depressed, we won important new business
from a broad cross section of customers, including a record order for 100 Next-Generation
737-800s from European low-fare carrier Ryanair. Throughout the year we competed
aggressively while maintaining disciplined pricing in support of our stakeholders’ long-term
interests.
Late in the year, we decided to move forward with our customers
and technology partners to develop a new, super-efficient, midsized airplane,
currently designated as the Boeing 7E7. The new airplane will fly as fast and
as far as the 777 and 747 and incorporate the advanced technologies identified
during the feasibility study for the Sonic Cruiser. This decision will shape
the future of the industry and will represent the bulk of our research-and-development
activities. Central to our product strategy is the belief that people prefer
direct, point-to-point flights that take them — efficiently, safely and
affordably where and when they want to travel.
Our focus on operating efficiencies continues to drive profitability
improvements. Lean manufacturing applications — including the use of moving
lines — resulted in a four-day reduction in final assembly flow time for
the 737. We vacated and disposed of more than 4.5 million square feet of facilities,
and we streamlined our supplier base by 16 percent. We also secured labor agreements
that will enhance our competitiveness. We will continue to move up the value
chain in our operations, resulting in better use of our assets, improved efficiencies
and continued profitable performance. |
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