Japan to keep its share of production of Boeing's new 777X aircraft
By Tim Kelly
TOKYO (Reuters) - Boeing Co (BA.N: Quote) has lined up Japanese companies, including Mitsubishi Heavy Industries (7011.T: Quote) and Kawasaki Heavy Industries 7012.T, to build one-fifth of its latest plane, the 777X, retaining Japan as its key Asian partner in commercial jetliners, two sources with knowledge of the plans said.
This would give the Japanese companies a share of the work on the new plane that is on par with the 21 percent of the 777 aircraft they have been making for two decades.
But because Boeing plans eventually to build more planes per month, there should be a greater volume of work for the Japanese suppliers, one of the sources said. Boeing's current production rate for the 777 is 8.3 a month.
A Boeing spokesman in Tokyo declined to confirm the information.
"Supply chain partnerships and production system decisions will be addressed at the appropriate time," the spokesman said.
Boeing, and to a lesser extent Airbus (AIR.PA: Quote), its European rival, assemble jetliners from parts made across the world. The arrival of new models or major variants of earlier ones - like the 350-406-seat 777X - gives suppliers a chance to compete.
For Mitsubishi Heavy, Kawasaki Heavy, Fuji Heavy Industries 7270.T and other Japanese suppliers, the high watermark for Boeing work so far is the 787 Dreamliner, with 35 percent of the carbon composite jet, including wings, built in Japanese plants.
Delays in the 787 development and delivery, due in part to difficulties of managing a global supply chain, prompted Boeing to keep more of the 777X, including the wings, at home. Continued...