Workshare for 777X which Japan wants is between the 35% of the 787 and the 21% of the 777. But the 777X will be less Japanese.
For 50 years Boeing has awarded bigger and bigger shares of its supply contracts to Japanese firms, but that could change after Japan Airlines' shock defection to Airbus and as Boeing seeks to win orders in China.
Boeing's 787 is 35% made in Japan - as big a share as it builds in-house - but Japanese aviation insiders fear the Dreamliner could be the high water mark of the industry's partnership with the U.S. company.
The close co-operation has not only benefitted Japan's industrial giants Mitsubishi Heavy Industries , Kawasaki Heavy Industries and Fuji Heavy Industries - it has also enabled Boeing to dominate one of the world's biggest aviation markets with a share of more than 80%.
That status quo crumbled last week, when JAL signed a deal to buy 31 Airbus A350s, its first purchase of European jets.
"Negotiations for the 777X work share are ongoing, and that may be influenced by the JAL decision," a government official who helps oversee Japan's aerospace industry told Reuters on condition of anonymity because of the sensitivity of the talks.
Tokyo, he added, was looking to win a work share for Japanese suppliers greater than the 21% that Mitsubishi Heavy, Kawasaki Heavy and others build of the current 777.
The fear in Japan is that Boeing, which says the business it gives Japan adds up to 22,000 jobs accounting for around 40% of nation's aerospace workforce, may be tempted to shift more production to China, South Korea or elsewhere.
"If I was Boeing, I would hold their feet to the fire," said Lance Gatling, from aerospace consultancy Nexial Research. "International competition for what they build can only increase."
China and South Korea could be the competitors.
JAL's defection to Airbus stacks on top of other reasons why the Japanese may find it harder to win bigger chunks of business from their American partner.
Boeing, having faced criticism it overextended itself on the delayed 787 with an ambitious global supply chain, has said it will take a more conventional approach to the 777X, a re-engine more fuel efficient upgrade of its long-range, wide-body 777.
That, industry watchers say, could mean it builds the aircraft wings at home, after allowing the Dreamliner wings to be made overseas - in Japan - for the first time.
A longer-term worry for the Japanese is that their country, once Asia's biggest aircraft market, is no longer the goldmine that first drew Boeing to seek panel suppliers for its 747 there.
Both Boeing and Airbus are now more focused on vying for business in burgeoning China. The entry price often imposed by the Chinese government is a share of the build.
Boeing, in its most recent 20-year market forecast that runs through 2032, predicts China will buy 6,000 new planes while the market in Northeast Asia, which includes Japan, North and South Korea and Taiwan, will be 1,360 aircraft.
"If the Japanese could put the arm on Boeing the Chinese have got the ability to put the arm on Boeing," said Nexial Research's Gatling. "The Chinese have cheap labor and a huge market."
He added that the Japanese were also looking over their shoulders at upcoming South Korean firms such as Korean Aerospace Industries, which Boeing in 2011 named supplier of the year.
One lure that could keep Boeing heavily involved in Japan is government financial support for R&D that could end up in its jets.
According to the European Union, which is locked in an aircraft subsidy dispute with the United States, Boeing benefits from support from the Japanese government for development of the 787, including financing of up to 70% of development costs incurred by Japanese suppliers.
"Obviously JAL's decision is a setback, but Boeing has been investing in Japan for decades and is not going to suddenly say from now on we don't like you," said Adam Pilarski, senior VP at aviation consultancy Avitas, on the sidelines of an aviation finance conference in Barcelona.
And the next battle is ANA …
Based on the article “Japan worries about Boeing retreat in wake of JAL defection” published in Reuters