Eerik Helmick's Profile

I think that alternative fuels/ biofuels are quite challenging to implement due to energy density. This is really a problem for the airplane manufacturers to solve, and less so for the airlines. Biofuels cannot be used for an extended period of time in the current fleet of airplanes without component redesign/ replacement. The fuel tank has a finite amount of space, so the range of the aircraft is effectively decreased when using biofuels. Furthermore, in flights below max range, more biofuel must be carried, which increases the weight of the plane and works against the biofuel benefits since more fuel is burned.

One interesting aspect of increasing airplane efficiency is flight route optimization. A huge amount of fuel is consumed during takeoff, so very short flights are not fuel efficient. On the other end of the spectrum, near maximum airplane range flights require larger amounts of fuel to be carried, which decreases efficiency as well. This means that the most efficient flight length is somewhere in between those extremes (2000-3000 nautical miles for 777). Flights can be planned to have increased numbers of layovers to increase efficiency. However, this would of course contribute to more inconvenience to customers.

I believe a relocation of core operations to the PNW from California could drastically improve the Sierra Nevada business. Firstly, transportation costs could be drastically reduced for the majority of PNW located hops that need to be shipped to California. Secondly, the move would place operations in an area less strained by droughts. This move could increase their margins and allow them to reinvest in new hops growing locations that would further diversify location-based climate risk. Alternatively, Sierra Nevada could become an industry leader in GMO hops / drought resistant hops / temperature resistant hops. This course of action seems feasible due to their overall size and ability to invest in hops R&D. I believe these changes could put them at a competitive advantage relative to their competitors, but their sustainability efficiencies should be shared in principle in order to drive the entire craft beer industry towards a more sustainable future.

This article stands in almost direct contrast to the articles written on Boeing vs. the C-series program where Boeing worked with the U.S. government to create huge tariffs on imported airplanes from Canada, and effectively blocked direct sales from Canada. However, China has two large advantages to Canada in this regard – 1. the Boeing supply chain is dependent on China whereas it is only lightly dependent on Canada. 2. Boeing is heavily targeting the Asian airplane market. Both of these reasons mean that Boeing and the U.S. government must be much more careful in their interactions with COMAC so as to not create retaliatory action.

One interesting aspect that I would argue is the overall size of the markets. While the North American market is currently dominant, the future market outlook actually predicts the Asian market eclipsing the U.S. market and eventually greatly surpassing it by 2035. It is actually more important for Boeing to be able to sell airplanes in Asia, than it is for COMAC to be able to sell airplanes in the U.S. just based on pure market size. However, the needs filled by a very small COMAC plane vs. the needs filled by a much larger Boeing or Airbus plane are very different, and most airlines will need both. On a basic level, I believe COMAC should try to enter the U.S. market, but should focus the majority of its efforts on the Asian market.

(http://www.boeing.com/resources/boeingdotcom/commercial/about-our-market/assets/downloads/cmo_print_2016_final_updated.pdf)

As you mention, Boeing and Airbus have a history of fighting with each other through the WTO regarding illegal subsidies or tax benefits. I would argue that Boeing is actually not hurt significantly by Airbus acquiring 50.01% of the C series program, and in the process of doing so the U.S. economy is improved by bringing final assembly to Alabama. However, Boeing is partially not impacted because the Boeing supply chain does not rely heavily on Canadian product. Smaller portions of the 787 are assembled in China and then finished in Canada before being shipped to Washington, but no major sections of Boeing aircraft are produced there.

What I am much more concerned about is how this story unfolds in the future with COMAC, the largest airplane manufacturer in China. COMAC is even more government-subsidized than the C-series program is. In addition, Boeing’s supply chain is heavily dependent on China. To make matters worse, China is a quickly growing market for Boeing aircraft, and a key to Boeing’s growth 2020-2040. If a similar situation unfolded with COMAC, the results could be much more detrimental to Boeing and the U.S.

I’d add that the actual count of trucks on the highway will drastically go down, as automated trucks will not require sleeping breaks, which currently add huge cost and delay to the overall shipping process. Truck crashes due to lack of sleep were a huge issue for the industry, so there are now regulations in place to force sleep at regular intervals. Being able to drive for nearly 24 hours a day will make shipping via land for 2 day/ express delivery much more viable in situations that would have previously used air freight.

While there will be huge losses in trucker jobs, I believe this will be more than offset by the increased demand for labor in industries that support the change to autonomous trucking. First of all, it is not feasible to add automation to existing trucks, so a huge number of automated trucks must be built over the coming years to replace the aging fleet. Second of all, additional labor will need to be in place to support autonomous truck refueling for both gas and electric trucks (they will likely not fuel on their own). Thirdly, the infrastructure needed to support electric truck refueling along all major highways will be colossal, and I believe that the creation of this new infrastructure will create a large number of jobs.

This is a really interesting article about a topic I have not considered despite years of using 3D printers in house as well as outsourcing 3D print jobs. I think that you are right that in house 3D printers will cannibalize some shipping business, but I think the extent to which this is the case may be overstated. I believe that 3D printed parts are differentiated from their large scale production, injection molded equivalents by the size of the orders and the speed of delivery. For the vast majority of use cases, 3D printed parts are for prototyping and need very quick delivery or creation on a rapid development cycle, so they would not cannibalize the storage portion of UPS sales. Furthermore, most of these 3D printed prototype parts are followed by an injection molded or other mass production manufacturing equivalent in real use, so UPS is not significantly damaged.

Secondly, there is already a lot of competition in outsourcing 3D printing via services such as protolabs.com. These services are much better known than UPS, and there is not much UPS can do to differentiate itself from these existing services. UPS (or Fedex, USPS) still needs to support the generally quick shipping for these outsourced 3D printed parts, so outsourced 3D printing does not damage the business in any way. UPS could look into a partnership here, but I am not sure what added value they are providing by bringing this technology in house.

Finally, I believe a good portion of shipping business lost to the 3D printed parts created in house may be offset by the shipping of raw materials for the 3D print jobs – including the filament and support trays that each individual job needs. The support materials are actually relatively significant is volume/ weight compared to the end product produced by each print job.