Fasteners ‘High Risk’ Item for Boeing 787

Jason Sandefur

A tight aerospace fastener market has led to a critical shortage of fasteners for Boeing”s 787, which could slow production for the Dreamliner as the aerospace giant ramps up to meet deliveries beginning in 2008. \
Alcoa Fastening Systems is reportedly working to complete design work and get the 9 different fastener types to Boeing”s factory in Everett, WA. The fasteners are needed to replace temporary rivets now being used to hold composite structures together for transport. Large sections of the 787 are manufactured in Japan, Italy and the U.S. and flown to Boeing”s plant in Everett, WA, for final assembly.
The Dreamliner will carry up to 330 passengers on routes of up to 8,500 nautical miles. The 787 offers strong fuel efficiency, using 20% less fuel than today”s airplane. Its launch has been dubbed the most successful in aviation history.
“The fastener industry as a whole is stretched right now due to the increased demand from airplane manufacturers worldwide,” Boeing 787 communications director Adam Morgan told FastenerNews.com.
Morgan said the decision to use temporary fasteners on composite structures for transport was not hastily made.
“We”ve known about (the fastener shortage) for months and have also known for months that parts would arrive with temporary fasteners,” Morgan told FIN. “We are in close contact with our fastener suppliers and will continue to exchange temporary fasteners for permanent ones as they arrive.”
But Morgan sounded confident that the fastener issue would not derail Boeing”s production of the 787.
“The bottom line here is that we”ve known about this, we have, and are, prepared for it, and our needs will be met.”
Complicating matters, requirements for 787 fasteners reportedly came near the end of the program”s detailed engineering design process, giving fastener makers a late start in tooling up to produce the unique fasteners.
What”s kept Boeing”s problem manageable is the fact that far fewer fasteners are need for the 787 because of its new production, which calls for manufacturing large composite structures rather than making the fuselage and wings by fastening together small aluminum pieces.
“We don”t have a number of how many total fasteners a 787 will have, but in general terms, a one-piece barrel will provide a reduction of 40,000 – 50,000 fasteners compared to an aluminum airplane,” Morgan explained.
This new method equates to about an 80% reduction in fasteners for the 787.
Despite this, Alcoa reportedly projects that supplies of rivets for the Dreamliner are tight and will get worse, driving up demand by as much as 20%.
“The fasteners are a bigger challenge than we anticipated,” Scott Strode of Boeing told the Seattle Post-Intelligencer. “We were surprised at how much detailed management we have had to do on all those little fasteners to get them here.”
Strode said fasteners are “a watch item that Boeing considers “high risk.””
Contrary to media reports, fastener industry consolidation in the wake of the aerospace downturn following the Sept. 11, 2001, attacks has not hampered the industry”s efforts to supply aerospace OEMs.
“The consolidation on the aerospace fastener industry has not had a dampening effect on the ability to ramp up,” an aerospace fastener manufacturer told FastenerNews.com. “At worse it has been neutral, at best the new owners may have encouraged the addition of new or more capital equipment to help meet the demand.”
Hagan: Aerospace Fasteners Demand Fueling Acquisitions
Delivery lead-times for many aerospace fastener manufacturers “are presently running at more than 40 weeks on new incoming orders,” which has led to major corporate acquisitions, a specialist in fastener mergers and acquisitions found. “The aerospace fastener sector has experienced the most significant deal activity over the past few years, with attractive prices being paid for both manufacturers and distributors,” Pinnacle Capital Corporation president Richard Hagan observed.
“With strong demand from commercial aircraft manufacturers and steady spending on maintenance and repair by the U.S. government, most aerospace fastener manufacturers are currently producing at maximum capacity,” Hagan told FastenerNews.com. “Quite logically, strong current and projected sales and profitability for the aerospace fastener segment has made it attractive for opportunistic buyers and sellers to get together.”
There were five aerospace fastener acquisitions with selling prices in excess of $30 million completed during 2006, and two major aerospace fastener deals this year. Precision Castparts paid $300 million for Cherry Aerospace and JLL Partners bought McKechnie Aerospace for $850 million. Hagan said he expects “2007 will be another banner year for deal-making in the aerospace fastener segment.”
The Aerospace Industries Association reports that industry sales rose 11% in 2006, with an 8% increase projected this year, Hagan pointed out. Much of the sales growth has occurred on the commercial side where orders and backlogs have ballooned.
“The production capacity of both Boeing and Airbus is essentially sold out through 2011 and analyses of the age of the world”s commercial airline fleet suggest that replacement orders should remain strong for many years,” Hagan explained.
Historically, the aerospace sector goes through five-to-seven year up-and-down cycles.
“The prospects are excellent that the current up cycle which began in earnest during 2004 will last for quite some time,” Hagan reflected.
E-mail: rphagan@pinnaclecapitalcorp.com �2007 FastenerNews.com