Shortages, logistics in Japan may hinder Boeing suppliers

Boeing's major Japanese partners survived the March 11 quake without significant damage but the company is still assessing how suppliers will cope with transportation and energy problems, a senior executive said Sunday.

"The first look was, no major structural damage to our major suppliers. That was a big relief," said vice president Pat Shanahan who is in charge of all airplane programs.

But he said it's harder to learn how the sub-tier suppliers in Japan are doing and also how the infrastructure damage in Japan will affect transportation logistics.

"That's hard for us to inspect," Shanhan said. "Right now we can go into factories, we can check the tools, we can check the (parts) bins, we can check the inventory. But how about getting stuff out of the ports? How about getting stuff here?"

Speaking at Boeing Field after the first flight of the new 747-8 Intercontinental jumbo jet, Shanahan said the regular rolling power cuts following the quake were an early concern, but that at least Japanese manufacturers know when to expect those and can plan for them.

"What you don't know is how does the internal infrastructure — (shortages of) gas and basic necessities — play into this," Shanahan said.

"Everybody is doing a lot of evaluation,"he added. "We've got a lot of people, boots on the ground."

The big Japanese manufacturers — especially Mitsubishi, Fuji and Kawasaki — are major suppliers of parts for all Boeing jets, but particularly to the 787 Dreamliner, 777 and 767 programs.

Shanahan said that in this early stage of the crisis, "it's really less about business than, what do they need and can we be of any help."

Boeing's Japanese airline customers have some near-term airplane deliveries coming up. Shanahan said Boeing is assessing if it can send "any type of relief or emergency supplies on those delivery flights."

Standing in front of the new 747-8, the first freighter version of which will be delivered this summer, Shanahan suggested that the crisis could even lead to more orders for the big cargo plane.

"Who knows what Japan is going to need as they go to rebuild," he said. "You can only imagine that people will be using these freighters quite a bit more."

But clearly Boeing executives are concerned about the potential for any interruption in the flow of parts from a country so central to its supply lines.

Shanahan related a conversation he'd had earlier in the morning with Ray Conner, the vice president who heads the supply chain organization, about the 747-8 flight.

He said Connor told him, "'Please don't damage the airplane. We don't have a lot of extra inventory.' "

Dominic Gates: 206-464-2963 or dgates@seattletimes.com