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In Japan, Dreamliner Woes Test Cozy Corporate Ties

Wall Street Journal Original article ›

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The close ties developed in the postwar years between Japan and Boeing. Japanese suppliers supplied 16% of the 767 model in 1982, growing to 21% in 1995. By 2011 with the 787 Dreamliner Japan's role had increased to 35%. ANA and JAL almost exclusively use Boeing planes, shutting out Airbus from the Japanese market. New upstart airlines are beginning to order from Airbus. The Japanese government also supports suppliers of Boeing in Japan. Employment is also a consideration as 43% of employment in Japan's aviation industry is linked to Boeing. The battery on the Dreamliner 787 is supplied by Kyoto based GS Yuasa Corp., and Kanto Aircraft Instrument Company near Tokyo makes the circuit board that runs the battery. Battery related fires have led to grounding of 17 Dreamliners operated by ANA and 7 Dreamliners of JAL airlines in Japan. All Nippon Airways is the first and largest operator of the new Dreamliner aircraft. So tight is the relationship that Airbus has in total about 44 planes flying in Japan, with newer airlines such as Skymark expected to use the new Airbus A380 superjumbo aircraft in 2014. ANA and JAL typically do not bargain hard on pricing with Boeing because this supports Japanese manufacturers. ANA managers say it was involved in the design of the jet, including the use of a durable Japan made paint. In the 1990's Boeing studied Japanese manufacturing methods to improve work on its assembly lines, which goes on till today.

Boeing's close ties with Japan's aviation industry and its major airlines

01/29/2013

Boeing has developed close ties since the Second World War with customers and suppliers in Japan. The Japanese government supports this strong relationship. ANA and JAL use Boeing planes almost exclusively and ANA's officials say the Dreamliner is "35% Japan and 35% Boeing." Japanese suppliers make 35% of the parts for the Dreamliner 787 plane which are later assembled in the U.S. The battery is made by a company in Kyoto. Airbus is practically shut out from the Japanese market. ANA and JAL also are the first major users of the plane.

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