Japanese Firms to Do 21% of Work on the Boeing 777

In a step toward Japan’s goal of developing an aircraft industry, three Japanese manufacturers have reached an agreement to take their largest role ever in development and production of a new U.S. jetliner.

Mitsubishi Heavy Industries, Kawasaki Heavy Industries and Fuji Heavy Industries reached an agreement with Boeing Co. last week under which they will jointly develop and manufacture components valued at 21% of the cost of the airframe of the 777, according to Takayoshi Furuya, spokesman for Mitsubishi Heavy.

The twin-engine 777, a new 300- to 400-seat aircraft scheduled to be completed in 1995, is expected to compete against the McDonnell Douglas MD-11 and the Airbus Industrie A-330/340 in the market for long-range jets.

Japanese firms are also supplying parts worth 15% of the value of the new Boeing 767.

On the 777, Japanese firms will for the first time be involved in virtually every stage of development from design to airworthiness tests, financing and after-sales maintenance, Furuya said.

“We are not a full partner, but we are more deeply involved than before. We are a program partner,” said Furuya.

The 777 agreement is in line with a 20% estimate for Japanese participation disclosed last April when Boeing signed a memorandum of understanding with the three firms. But the agreement signed Friday is only interim. A final contract must still be negotiated, Boeing spokesman Dick Schleh said from the firm’s Seattle headquarters.

In any case, Japanese participation is less than under earlier proposals. They would have had Japan assuming a risk-sharing 25% equity role and a voice in overall design of the aircraft.

Schleh said Friday that the Japanese role is narrowly focused.

“They do not have responsibility for the overall airplane,” he said. “They are supplying a major portion of the airframe, principally fuselage panels and other items. But they don’t have involvement in the overall design of the airframe. They have to do the detail design of what they are responsible for, of course.”

Both sides declined to give the amount that Japanese firms would invest in the project and or name which companies would produce which components. Mitsubishi Heavy is widely expected to take on the lion’s share of the Japanese position. A Japanese newspaper reported that the Japanese contribution to the project would be about $770 million.

One look at a diagram of the new plane would suggest that Japanese firms were building the entire plane, said one Boeing official. The fuselage, wing ribs and fairings (the area where the wing is joined to the body) are all made in Japan.

However, he added, critical portions of the plane, including the engine nacelles (the housing for the engine), the vertical and horizontal stabilizers on the tail, the wing flaps and wing skin panels and the crucial nose and cockpit portions will be designed and manufactured by Boeing.

A major coup for the Japanese manufacturers, however, is that their engineers will be involved in some of the design work with Boeing for the first time. “Design teams from each side will be working side by side,” said a Boeing official. “That will be a new adventure.” Japanese engineers, he said, will learn how to design certain aircraft parts from scratch.

Eighteen Japanese technicians reportedly already are at Boeing’s Seattle headquarters working on initial designs. Of the 1,000 engineers working on the plane, 150 to 200 are expected to come from the Japanese partners.

Staff Writer Ralph Vartabedian in Los Angeles contributed to this story.