Pontifications: Revisionist history

By Scott Hamilton

Sept. 25, 2017, © Leeham Co.: The US Department of Commerce today is scheduled to release its decision on whether to impose tariffs on each Bombardier CS100 delivered to Delta Air Lines, starting this year. (The public announcement is tomorrow.)

The tariffs will be in two forms: one for dumping the aircraft at prices below that sold in the home market (Canada) and one for “injury” to Boeing.

LNC understands the total could be in the range of $32m per plane. We don’t know if this a correct figure.

Boeing told its investors conference last week it’s pursuing this complaint about Bombardier subsidies to avoid another Airbus emerging and destroying Boeing and the US aerospace industry—an idea included in Boeing’s filings with the US government.

In those filings, Boeing claimed Airbus led to the demise of Lockheed’s commercial aviation business and of McDonnell Douglas.

I think this is a bit of revisionist history.

Icing on the cake

There’s no doubt Airbus’ rise made life miserable for MDC’s commercial business. Lockheed, as the fourth teat in the business, suffered as well. But if anything, Airbus was only icing on the cake of the downfall of these two companies.

Lockheed and McDonnell Douglas failed largely due to their own business decisions and factors unrelated to the entry of Airbus into the market.

The first problem was that the companies designed nearly identical airplanes: 250-300 passenger tri-jets. At the time, the aerospace analysts worried that the companies would divide the market and neither one would make money.

This is exactly what happened.

Each also had external factors that contributed to their demise.

Lockheed

Lockheed wanted to reenter commercial aviation, having exited following the development of the Electra propjet. The Electra was Lockheed’s choice to follow the successful Constellation series while avoiding competing in the emerging jet market in competition with Douglas, new entrant Boeing and Convair with the DC-8, 707 and CV-880 respectively.

The Electra was a superb aircraft, with good passenger comfort, over-powered and flexible in operation. It also had a fatal flaw that caused wings to separate from two aircraft in flight, killing all aboard. The aircraft were put under severe speed restrictions until modifications were made.

With propjets of the Electra’s size and design of limited demand with the pending designs of the small twin- and tri-jets, and the program loss due to the design defects, Lockheed exited commercial aviation once the program wound down. The last Electra was delivered in 1961.

A few years later, the company decided to reenter the airliner market with the airline requirement for a jumbo jet smaller than the Boeing 747, which could economically serve the domestic US market and short- to medium-range routes worldwide.

Production began in 1968.

McDonnell Douglas announced plans for a nearly identical DC-10. The program was launched in 1968.

Simultaneously, Lockheed was awarded a defense contract for the C-5A, the giant military transport.

The C-5A was afflicted with massive cost overruns and delays. The L-1011 program had its own issues, tracing to the Rolls-Royce engines selected for the airliner. RR went into receivership in England and for a time, it was unclear if Britain would bail out RR and proceed with the engines. Lockheed was faced with an airplane and no powerplant.

The C-5A program and the RR issue brought Lockheed to the brink of bankruptcy. In a controversial move, the US government provided loan guarantees for Lockheed (one might call this government subsidies by another name). Lockheed was saved. England reorganized RR, which produced the L-1011’s engines. But Lockheed suffered a two-year program delay in the process.

The L-1011 program problems meant Lockheed was unable to immediately produce a long-range version against the MDC DC-10-30/40. The L-1011-500 wouldn’t enter service until 1979, long after the competitor. This suppressed sales.

None of this had anything to do with Airbus, which was in formation concurrently with development of the L-1011 and DC-10. The first A300, a 250-passenger twin-engine wide-body designed for short- and medium-haul routes, entered service in 1974, two years after the L-1011 and three years after the DC-10.

Lockheed needed to sell 500 aircraft to break even. Sales failed to meet targets. The company announced in 1981 it would cease production after the 250th L-1011. Production shut down in 1985.

Lockheed collapsed under the weight of the C-5A, the Rolls-Royce bankruptcy, splitting the market with McDonnell Douglas and for too long an orphan airplane. Airbus was just icing on the cake.

McDonnell Douglas

MDC’s decline in commercial aviation started with the DC-10 as early as 1974—though the first danger sign emerged in 1972, just a year after the aircraft entered service.

In June 1972, an American Airlines DC-10-10 cargo door blew off the airplane shortly after take-off from Detroit. The low altitude—11,750 ft—meant the pressure differential between the cabin and outside was not great. Still, the floor partially collapsed on to control cables. The pilots were able to land the plane safely.

The issue was traced to a poor design of the latch for the cargo door.

Despite this event and the warning it provided, the fix wasn’t performed on a timely basis on the fleet then in service. Two years later, a Turkish Airlines DC-10-10 taking off from Paris with a full load of 346 passengers and crew. The cargo door blew off, collapsing the floor. This time, the pilots couldn’t save the airplane. It crashed, killing all aboard. It was the worst air disaster up to that time.

Given that the cargo door was an issue revealed two years previously, the safety of the DC-10 came under scrutiny.

Five years later, another deadly accident led to the grounding of the airplane, once again over safety concerns.

In May 1979, an American DC-10 took off from Chicago. Before lift-off but after the plane was committed to take-off, the left engine separated from the aircraft. As designed, it flew up and over the wing. During this maneuver, the leading edge of the wing was hit and a hydraulic line was severed. The left wing leading edge slats, held in place by hydraulic pressure only, retracted. The left wing stalled.

The pilots, as it turned out, followed the one-engine out manual to the letter. Unable to see the wing and engine, all they knew was the engine power failed; they didn’t know the engine separated from the aircraft. The manual called for power reduction. With the left wing stalling, the reduction worsened the situation. The plane went perpendicular to the ground, nosed over and crashing into a trailer park. Everyone on board plus a few on the ground was killed.

Investigators examined the engine, which was on the runway at O’Hare, and discovered a severed flange, one of two that attached the engine to the wing, had failed due to fatigue. The FAA grounded all DC-10s for inspection and repair.

The investigation revealed that a procedure used by American and approved by McDonnell Douglas and the FAA to short-cut engine/pylon removal cracked the flange. It wasn’t a defect in the airplane but a defective maintenance procedure.

But the lack of a locking device for the wing slats was a design flaw. This and the grounding further blackened the eye of the DC-10 to such an extent that American removed the name of the airplane from its livery.

These incidents and the safety concerns hurt sales.

None of this had anything to do with Airbus.

MDC’s management also refused to invest in new airplane products. The MD-80 was a derivative of the DC-9. There was a big product gap between the MD-80 and DC-10. An upgrade of the MD-80 to the MD-90 wasn’t sufficient to attract customers.

When American signed an exclusive supplier agreement with Boeing in the mid-1990s, then-CEO Robert Crandall called the MD-90 “old technology” in explaining why he switched from McDonnell Douglas to Boeing.

MDC looked at developing a new aircraft with Fokker and South Korea. Neither happened. MDC conceived a twin-engine DC-10, but this went nowhere. MDC developed an MD-12 concept, an airplane that was similar to the later A380. No go.

By 1997, MDC was down to a 7% market share in commercial aviation, behind Boeing and Airbus. Faced with a need to invest $15bn to become a viable competitor again, then-president of MDC Harry Stonecipher said no. A merger with Boeing was agreed.

McDonnell Douglas’ demise in commercial aviation had more to do with the DC-10 experience and refusal to develop new airplanes than it was about Airbus.

The DC-10 experience occurred during the early years of Airbus, when only the A300 and A310 were produced. The A320 didn’t enter service until 1988, by which time MDC relied only on MD-80 derivatives.

Lack of commitment to commercial aviation, the DC-10, failure to invest in new airplanes and new technology is what killed MDC. Airbus benefited and may have helped it along, but MDC’s death was self-inflicted.

Speaking of government support

Boeing’s revisionist history overlooks its early days of relying on government money that benefited commercial airliners. The 307 Stratoliner, the industry’s first pressurized aircraft, used the wings, tail and engines from the B-17 bomber. The 377 Stratocruiser was a straight-forward conversion of the wartime C-97.

Even the 707, with the myth that Boeing bet the company on this airplane, came after a USAF commitment for the KC-135 tanker.

The 747 benefitted from R&D spent on the C-5A competition that Lockheed won.

And, while Boeing continues to deny it (see the last sentence of the second paragraph here, which is just not true), the World Trade Organization found Boeing received illegal subsidies from federal and state governments in the US (though far less than those received by Airbus).

Boeing is pursuing the complaint against Bombardier to avoid creating another Airbus.

In a twisted way, Bombardier really should take this as a compliment. Boeing in effect concedes that the CSeries is better than the 737 MAX.

Not bad for a company one sixth the size of Boeing in terms of revenues.

183 Comments on “Pontifications: Revisionist history

  1. Thanks Scott, will the predicted $32M “tariff” be specific to DL’s order for 75 CS100’s or will this also be applicable to any future orders of “Canadian commercial aircraft between 100-150 seats” in the US?

        • I liked it a LOT better than the DC-10 (never flew an MD- 11)

          I never quite got the slant angle in level (supposedly) flight.

          It was odd to be headed to the toilet and have a slant.

          Worse were the food and beverage carts that the cabin attendant fought with.

          I read latter it had to do with the wing angle and efficiency of flight.

          I felt sorry for the FTs. Otherwise it was really solid and flew well.

          • In Plane Numbers (pun intended) can anyone tell me what Desalt agreed to pay for the aircraft?

            Is the penalty actually 32 million per?

            And does this mean a model vs an aircraft?

            In other words , Boeing sells 737-700 in the US to United at a killer sale (loss) – didn’t that go for like 25 million?

            Does that mean they can be accused of duping a 737-800/8 anywhere else in the world?

            Or what are other country laws in regards to dumping?

          • Guess if the US Treasury collects $2.4 Billion it will go towards subsidizing Boeing to develop an NSA?

      • Yes, very advanced both in its avionics and with an improved method of fuselage construction which is echoed today in the A350- although the Tristar used aluminium for its long panels to make the fuselage sections instead of the composites like the Airbus.
        The fault with the Electra which caused the wings to break was really an attachment problem with the engine mounts and resonance in flight.

  2. Not bad for a company one sixth the size of Boeing in terms of revenues. could not have said it better.
    Thanks Scott

  3. Brave stuff Scott. I thought Boeing was all that was virtuous in this world and competed against unfair and nasty Europeans. Looking at the status quo the level of subsidy at Boeing is of a magnitude that makes this complaint against BBD risible.

  4. The A300 and A330’s never had the L1011 or DC10/MD11 ranges. DC9’s went through a phase with a checkered safety record that didn’t help, but lack of renewing the MD80/90 aircraft also didn’t help.

    Guess Boeing is scared the CS’s are becoming to the 737 what the A320’s has become to the MD80/90, a better aircraft.

    • The MD80 and MD90 never had the reliability of the 737Classics, only the 717-200 matched it. Douglas never had a big wind tunnel nearby and had problems designing great wings. Selling MD80’s below cost did not help either. Building MD80’a and a few MD90’s in China did not help. If Douglas had made a brand new Aircraft like the A320 instead and made a A330 type of DC-10 successor. Most Douglas customers became Airbus customers later on.

    • Sure The giant Boeing is scared like hell of the C Series, one the most best recent airplane in the world (for that size).
      +90% of Journalist in Aviation agree!

    • @Anton:
      “…A330’s never had the L1011 or DC10/MD11 ranges.”
      Interesting but odd claim when the nominal max range of:
      L1011-500(Longest range variant ever)=9,900km
      333(Earliest/shortest range variant no longer in production)=10,500km
      DC10-30ER(Longest range variant ever, totally 11 frames built)=10,600km
      M11ER(Longest range M11 variant ever)=13,410km
      332=13,450km
      338=13,900km

      Of course, don’t let facts get in the way of making a sensational claim….

      • The L1011-500 had a range with max fuel of ~11 000km.

        The 3 engined aircraft were also less affected by Etops restrictions resulting in longer real world ranges.

        • @Anton:
          “The L1011-500 had a range with max fuel of ~11 000km.”
          Which means well below full pax+bags @ nominal seat count. By such unusual definition(i.e. ‘max fuel’) which is really only relevant for ferry flights, add @ least 10%~15% to the ranges for each 330 variant which I hv listed earlier per the typical full pax+bags definition for nominal range.

          We can play this apple vs orange game all day long no matter how U skew the data to defend yr flawed claim….

          “The 3 engined aircraft were also less affected by Etops restrictions resulting in longer real world ranges.”
          1st of all, then U should hv stated clearly so in yr claim instead of a blanket/absolute-style statement like “A330’s never had the L1011 or DC10/MD11 ranges.”

          2ndly, the earliest 333 variant achieved ETOPS180 cert within 2yrs(just a little over a yr for ETOPS120 which is enough for Trans-N.Atl) of EIS which is sufficient for the longest scheduled nonstop oceanic routes ever actually operated by any L1011/D10(e.g. YVR->HKG by CP in the early 80s….I know because I was on such flight). U are exaggerating an op limitation relative to L1011/D10 which actually existed for less than 2yrs…..real op history of L10111/D10 is just as important as your so-called “real world ranges”.

  5. Excellent article. I worked for McDonnell Douglas. What happened to McDonnell Douglas had nothing to do with Airbus. Equally, what’s happening to Boeing has nothing to do with anybody but Boeing!

    The market forecasts are such that it is for Boeing to lose. This kind of behaviour from Boeing will help it lose. The world will react, remembering that the USA no longer owns world travel

    • I too worked for McAir. McDonnell was never interested in the commercial side of the business. They saw profits in the F-4s, F-15s, etc…

      • That was mistake of Douglas to merge with McDonnell at all, much better if they had gone with their hometown rival Lockheed and as a result only one tri engine jet produced.

  6. I asked this question before and never had a simple answer. Is the part of the $32m that is judged to be for damage to Boeing going to be eventually paid to Boeing?
    If so, perhaps the answer to how Boeing is going to sort out its $30 billion 787 problem may be seen in this claim???

    • If Boeing gets that money it will be a combination of a joke and something very sick, we talk about $2.4 Billion here.

      • Can Bbd bail out of the deal or just increase the price a bit and save themselves a lot of money?

        • Was also wondering if Delta could convert the CS100 order to say 25 CS300’s (equivalent total value what they payed for the CS100’s) and then place a new order for 50 CS100’s at a price X that will not be regarded as a dumping price?

          At least the money does not land up in the Governments pocket and in BBD’s.

          • Can Bbd just park the planes at the border until this is resolved? It all sounds very complicated to me.

        • Hello Grubbie,

          When anti-dumping duties are levied, they are ad valorem, i.e. levied in proportion to the estimated value of the goods or transaction concerned. Commerce may conduct annual reviews to adjust the duty rates, but at a given point in time, between reviews, if an importer subject to anti-dumping duties increases it prices by 10%, it will pay duties that are 10% higher. Duties are generally based on average prices over some extended period of time, such as a year. If an importer subject to anti-dumping duties goes three years without selling below normal value, it can apply for a revocation of the anti-dumping order. The following quote is from Chapter 27 of the USITA Enforcement and Compliance Division Anti-Dumping Manual, which nay be found at the link following the quote.

          “I. Revocation or Termination Based on an Absence of Dumping

          Under section 751(d) of the Tariff Act, the DOC may revoke an AD order/finding or terminate an AD suspension agreement if all exporters and producers covered by the action have sold the merchandise at not less than normal value (NV) (see Chapter 8 for an explanation of NV) for a period of at least three consecutive years and it is not likely that the exporters or producers will sell the merchandise at less than NV in the future. If a firm was found to have dumped merchandise in a past segment and if it meets the criteria cited above, it must in addition submit a certification that it will not dump in the future and agree to immediate reinstatement in the
          order/finding if the DOC concludes it has sold at less than NV subsequent to the revocation.”

          http://enforcement.trade.gov/admanual/2015/Chapter%2027%20Revocations.pdf

          • OK, so how about the fact that nothing has been delivered yet and no contract completed?Boeing seems to have them by the balls.

          • Things are actually a little bit more complicated than I Suggested in my post above. The fixed percentage rates collected at time of import are actually deposits that are an estimate of the duties owed. See the excerpt below from Chapter 21 of the USITA Enforcement and Compliance Division Ant-Dumping Manual.

            “After the Department issues an antidumping order and the ITC makes an affirmative injury determination, importers are required to pay antidumping duties on subject merchandise that entered the United States on or after the publication date of the preliminary determination (this date could change if critical circumstances are found or if the ITC finds only a threat of material injury). See Chapter 19. Given that the cash deposit rate established in an investigation is (see Antidumping Manual Chapter 21) only an estimate of the duties owed on the entries, interested parties may request that the Department determine the actual amount of antidumping duties to be paid on the entries. The Department makes such a determination in an annual administrative review. Administrative reviews also establish new cash deposit rates for each of the companies reviewed. Cash deposit rates calculated in administrative reviews apply to subject merchandise entered on or after the final results of review are published in the Federal Register. In some administrative reviews,
            the Department also determines whether the order or finding should be revoked with respect to a particular company. See Chapter 27. The Department may also conduct administrative
            reviews to determine whether a suspension agreement has been violated or should be terminated.See id. “

          • Thanks AFP, think I got about 10% of it right.

            Bottom line question I guess for many, if Delta and BBD comes to new a price of say $50M per aircraft that should be well in line with many criteria, will it over rule/nullify the ruling that is expected today?

            Could it require cancellation and re-order?

          • If I read this correctly. If Delta goes ahead with the order and pay the ~$30M per aircraft its only the US Government coffers that wins, Boeing, BBD and Delta loses at the end of the day.

          • I put my question in the wrong place. As it’s payable on import, can Bbd just park the planes at the border until this is resolved? This all sounds very complicated to me. Nice work for the lawyers.
            Thanks for trying to explain all this to me, I am sure your contributions will be helpful to other people as well.

          • Below are some excerpts from the US Customs Service Anti-Dumping and CVD Duty FAQ Page.

            Q: I paid the AD/CVD duties due when I imported goods into the United States. Do I have any further AD/CVD liability on that import?
            A: The AD/CVD paid at the time of entry are cash deposits of estimated AD/CVD duties. The final amount of duties owed is not determined until Commerce conducts an administrative review to establish the final AD/CVD rates on past entries. The final AD/CVD amount may increase, decrease, or stay the same from the AD/CVD cash deposit paid at the time of entry. After Commerce sends instructions to CBP on the final AD/CVD rate for the entry, CBP will assess this final duty. CBP will issue a bill for any increase in duty, and refund any decrease of duty. On average, this entire process, from the date of importation, takes approximately three years.

            Q: I paid a fair price to my supplier for my imported merchandise, and the estimated AD/CVD duties that I paid are too high. How can I get a refund of the duties when CBP liquidates the entry?

            A: You may request an administrative review of your imports from Commerce to determine the final AD/CVD duty liability. Commerce instructs CBP on the final AD/CVD rates, and CBP will assess final duties based on these instructions.

            Q: I do not believe that the goods that I imported fall under the scope of an AD/CVD order, and CBP required me to pay AD/CVD duties on my imported goods. How can I obtain a ruling that my products are not subject to AD/CVD?
            A: You may apply to Commerce for a scope ruling. For more information on applying for a scope ruling, see http://ia.ita.doc.gov/scope/Request-Scope-Ruling.html. Further, if you believe CBP misapplied the scope of the order as written, you may file a protest with CBP within 180 days after the entry has liquidated.”

            “Q: Are there any other special requirements for imports subject to AD/CVD duties?
            A: The regulations require that, prior to liquidation and the assessment of antidumping duties, the importer is required to file a certificate advising whether it has entered into an agreement or otherwise has received reimbursement of AD duties. If an importer fails to provide a statement of reimbursement prior to liquidation, CBP will presume reimbursement and double the duties.”

            The full FAQ may be downloaded at the following link.

            https://www.cbp.gov/document/faqs/adcvd-frequently-asked-questions-0#

          • For concreteness, here is a excerpt from the marching orders that went out to customs agents regarding a particular CVD case. There is no mention of particular deals or contracts, only a description of the merchandise and a list of manufacturers for which Customs agents are required to collect cash deposits before the merchandise enters the US.

            “TO: { Directors Of Field Operations, Port Directors }
            FROM: { Director AD/CVD & Revenue Policy & Programs }
            RE: Cash deposit instructions for certain crystalline silicon photovoltaic products from the People s Republic of China (C-570-011)

            1. Commerce has completed its administrative review of the countervailing duty order on certain crystalline silicon photovoltaic products from the People’s Republic of China for the period 06/10/2014 through 12/31/2015 and published the final results in the Federal Register on 09/12/2017 (82 FR 42792).

            2. Accordingly, for shipments of certain crystalline silicon photovoltaic products from the People’s Republic of China entered, or withdrawn from warehouse, for consumption on or after 09/12/2017, you shall collect a cash deposit of estimated countervailing duties at the following percentages of the entered value.

            Producer and/or Exporter: Changzhou Trina Solar Energy Co., Ltd.
            Case Number: C-570-011-002
            Cash deposit Rate: 13.93%
            Note: Entries from the following companies may enter under C-570-011-002: Trina Solar Limited; Trina Solar (Changzhou) Science & Technology Co., Ltd.; Yancheng Trina Solar Energy Technology Co., Ltd.; Changzhou Trina Solar Yabang Energy Co., Ltd.; Hubei Trina Solar Energy Co., Ltd.; Turpan Trina Solar Energy Co., Ltd.; and Changzhou Trina PV Ribbon Materials Co., Ltd.

            Producer and/or Exporter: Chint Solar (Zhejiang) Co., Ltd
            Case Number: C-570-011-003
            Cash deposit Rate: 13.93%

            Producer and/or Exporter: Hefei JA Solar Technology Co., Ltd
            Case Number: C-570-011-004
            Cash deposit Rate: 13.93%

            Producer and/or Exporter: Perlight Solar Co., Ltd
            Case Number: C-570-011-005
            Cash deposit Rate: 13.93%”

            “3. These cash deposit requirements shall remain in effect until further notice. Do not liquidate any entries of merchandise made during the period of review until liquidation instructions are issued.”

            For the full enforcement order, see the following link.

            http://adcvd.cbp.dhs.gov/adcvdweb/ad_cvd_msgs/23396?filter_cat=ALL&filter_type=ALL&page=5&per_page=10

            Regarding Grubbies question; “As it’s payable on import, can Bbd just park the planes at the border until this is resolved? “, the answer is that US AD and CVD Duties are only collected when the subject merchandise enters the US. If there are no imports into the US, then no duties will be collected.

        • Most commercial aircraft are delivered to the buyer at the factor. It is the buyer (DL, in this case) doing the importing so I would think that the buyer would be liable for the duties. In that scenario DL would need to cancel the deal, not BBD.

      • Some relief in a worst case scenario.

        If Delta pays the tariff will that be regarded as part of Capex and qualify to be deducted from tax?

        Wonder how you depreciate something like that on your books? Purchase price X + 32 = cost to company but asset value X, so a $2.4 Billion wipe out on your asset value? Can see I am not an accountant.

          • Delta is not the type company that likes to spend big on new aircraft without good reason.

            So far they seems to be very quiet, got a feeling they waiting for the final ruling before showing their hand?

  7. Very good article, but I doubt that the US will take it on board. Boeing is displaying similar management flaws trying to blame someone else for their problems. A well run company is just that, well run. They don’t need to worry about competition if their products are good. Better to get on with life and build better products than trying to get a leg up by deceit.

    Will be interesting to see the political fall out from Canada and UK. Seems they have more to lose than worrying about competition on an aircraft they don’t produce. I suspect they are worrying more about how to deal with the Chinese, maybe this is part of the plan except blind Freddy could tell you the problem is a lot bigger. Solution – build better products than the competition.

    • “Boeing is displaying similar management flaws trying to blame someone else for their problems. ”

      That is valid for the whole US.

      Trumps MAGA reached via a DoomsDay scenario.
      In the aftermath the notoriously unknown unknowns will
      be presented as a herd of scapegoats 🙂

      • Ewe: you got it wrong, its MASA (I will leave other to figure out what the S stands for but its not Smart)

    • @Davedownunder:
      “Solution – build better products than the competition.”
      A simple & elegant solution in theory but the problem is that in reality, the above solution(e.g. 787 program) typically costs much more/return much worse RoI than the alternative solution of legal battles(e.g. via anti-dumping or illegal subsidy claims) against perceived competitors.

  8. Obviously it was Boeing that put MD out of the airliner market.They were the ones who stopped production of the 717 and decided not to invest in a replacement.If boeing had stayed in that market space, bbd would never have launched the Cseries.

    • @Grubbie:
      “Boeing that put MD out of the airliner market.They were the ones who stopped production of the 717 and decided not to invest in a replacement.”
      If U recall that part of Boeing/MD product planning history in the late 90s/early 2000, U would know Boeing terminated 717 program mostly to avoid/reduce sales cannibalism/internal competition against 736 which just EIS in that period.

      “If boeing had stayed in that market space…”
      They did briefly for about 6yrs after 717 was finished until 2012. It was known as the 736 which had practically equal usable cabin floor area as today’s CS1. Fm anti-dumping perspective though, 736 would hv been exactly the U.S. domestic physical equivalent vis-a-vis the CS1 to be imported by DL fm 2018.

      Whether 736 was the optimal solution or attractive enough for that mkt space is a diff story….2 criteria clearly irrelevant to anti-dumping rulings.

      In effect in an extreme case scenario if Boeing were still selling Trans-Atl capable 707 and offer it for 321LR(i.e. similar cabin size as 707) level pricing today, Boeing will probably still hv an ‘reasonable’ anti-dumping case against Airbus if 321LR is imported(Not the ones fm Alabama of course) @ a price just slightly below its production cost to U.S. customers….

      • The 737-600’s initial sale to SAS to beat the MD95 is a good reference for DAL showing that initial Aircraft sales below cost to get market acceptance for a new model is common and Boeing does it as well.

        • @Claes:
          U.S. officials responsible to determine/issue ruling re alleged dumping within U.S. mkt absolutely do not care about nor reference sales transactions outside the U.S. in the past nor in the future. Fm U.S. mkt regulatory perspective, Boeing and BBD are free to mutually destroy each other all they want by giving Max7 and CS3 away for free to foreign customers.

      • The CS100 an ideal replacement of 717’s which Boeing stopped to produce and/or replace.

        Qantas Link still operates 20 of these, so BBD guys?

        • @Anton:
          “The CS100 an ideal replacement of 717’s…”
          Not ideal at all. It’s akin to saying 175E2 will be an ideal replacement for ATR72 just because their cabin sizes are similar.

          If an operator found 717 as an ideal workhorse for the job required, CS1 will unlikely be an ideal type for the same job @ the same operator.

          CS1 is far far more capable than any 717 can ever dream to become. By definition, that means too much surplus capability built-in.

          • Seems you know most things, then two questions;

            What will Delta replace its 717’s with and why did Delta ordered the CS100’s?

  9. An additional comment to your article is also the interesting close correlation between the acquisition of MDC by Boeing and Pentagon’s selection in the JSF (Joint Strike Fighter – future F-35) Program.

    If you recall, Boeing, Lockheed, MDD and Northrop each offered concept designs for the JSF. Pentagon down-selected only Boeing and Lockheed to continue the competition and ordered them to manufacture each one a prototype of their JSF offer. Consequentially Boeing produced the X-32 and Lockheed the X-35.

    As MDD was a major supplier of military aircraft, the loss of this program gave them the coup de grace. It was just a month between Pentagon’s selection announcement (16.Nov.1996) and Boeing’s announcement of purchasing MDD (15.Dec.1996).

    An additional unpleasant observation is also my perception that, while Boeing acquired MDD in the hope to strengthen their position in the JSF competition, they eventual lost.

    • Boeing didn’t acquire McDD. McDD acquired Boeing with Boeing’s money and kept the Boeing name because the McDD name was in the dumpster.

      look at the BoD composition before and after, where the CEOs and other senior officers came from.

      same as America West/US Air/American Airlines

  10. It’s worth reading Andrew Porter’s book “Transatlantic Betrayal”. In shortform, what he says is that the RR RB211 was selected as sole powerplant for the DC-10, but the US government pressurized the British government to surreptitiously (via Shorts) provide GE with the technical information to allow GE to put the otherwise-unsuitable US government funded military TF39 on the DC-10 as the CF-6. The British government was in a mess and needed an IMF loan which the US otherwise threatened to block. RR had bet the farm on getting the DC10 order and then took the Lockheed order on highly unfavorable terms in order to survive. We will probably never know for certain whether he is right, but he makes a compelling case. The Law of Unintended Consequences then took over.

      • Well yes, the CF6 has been successful. But in the time the CF6 + follow-on-designs have been on sale, Rolls Royce has gone bankruptcy to approx 50% of the market.

        So whilst the CF6 did well, the legacy ain’t great; GE has lost out on a ton of market share to a company that was on it’s knees and there for the beating that didn’t happen.

        Meanwhile P&W lost so much that they effectively exited the wide body market. P&W was there to be vanquished by a superior design; it wasn’t GE that did it. One can’t help but think, why not?

        So yes, the CF6 was a good design at the time, but then the company didn’t do enough with it. They rested on their laurels instead.

        Today we find ourselves wondering where exactly RR’s future GTF, Advance and Ultrafan will take them. If RR can make even just two of their research ideas work in the real world it might become very hard for any airline, US or non-US, to justify not buying RR engines. For example, if RR managed to get a clear 10% fuel burn advantage over GE, who would ever, ever buy a GE engine?

        Meanwhile there’s not been a single peep out of GE that they’re doing anything other than the same old architecture just run a little hotter than before, which is surely reaching an end. Is a future GE innovation going to be political, not technical?

        For a worthwhile parallels, take a look at the smartphone market. When Apple did the iPhone it wasn’t a mere incremental improvement on what everyone else was doing. It was completely different, effectively a single innovation (although they bought the multi touch UI). In many ways it was rubbish (short battery life for example). And yet they cleaned up.

        Moreover they did it at a time they could afford to do it – iMac had made them a ton of cash. Had they simply waited for iMac to start running out of steam before switching track, they might have lost out altogether to someone else. The time for a big innovation is at the time when you can afford it, when you have the money to burn. Waiting until you’re running short of market share is way too late.

        [Apple cleaned up so much that they could more or less buy GE for cash, and could buy Boeing a few times over]

        RR are doing the same thing as Apple, but it’s 45 years into a 60 program to do so (not 2 years, which is what Apple took). With it being a slow process it’s hard to spot it happening, but it does seem inexorable. At any time in the past 45 years GE could have gone for an architectural change, but they haven’t. It could cost them dearly. They’re leaving the door wide open to Rolls.

        P&W seems to have learned that radical innovation matters to survival, and their GTF will (once fully debugged) be a stellar engine. They deserve to make a comeback based on it, and good luck to them.

        As for Airbus vs Boeing, Boeing have given Airbus an easy, easy ride. Ever since the A320 first launched, when has the 737 ever been a true challenger to it on purely technical and performance terms? Practically never, I would boldly suggest. Airbus has had to do precious little to the basic design to more-or-less dominate the market segment. Only recently have they seen a need for a refresh, with the A320neo.

        Airbus hasn’t got it all right – A380 hasn’t (yet?) reached it’s prime time, A340 was perhaps the wrong idea – but on the whole they’ve done remarkably well. Meanwhile Boeing’s last successful innovation was 777, 23 years ago, and there’s worrying talk that the A350 program could end up taking dangerous slices out of both the 787 and 777X programs.

        What I don’t understand is how a country like the USA can be so frenetically innovative in some fields (e.g. software, smartphones, electronics etc), and yet seemingly staid and slow moving in a lot of others. Us Europeans are supposed to be the old world sluggards!

        • The A340 wasnt designed as a stand alone aircraft, it was essentially just an A330 with extra pair of engines for longer range flights.
          They did make a mistake in doing the bigger changes for the 500/600 versions as they couldnt compete as well against the B777-300ER. Boeing and GE may have done a bit of ‘unfair’ competition to make sure that happened- I dont know?

        • 737ng was extremely competitive and a barn storming success. The max was the result of caught napping. Still a huge success.
          Looking at other industries, trying to force customers into buying unsuitable products is not a good long-term strategy.
          Perhaps that’s the plan, just slow bbd down a bit.

        • Agree, RR went through turmoil in 1970 but the upshot has been a family RB211/Trent that has application across all wide bodies and the odd single aisle. The concept of a family of engines with evolutionary design has made RR ever stronger (the Trent 1000 begat the Trent XWB begat the Trent 1000 TEN begat the Trent 7000 as an example). The Trent has dominated key market segments and going forward will evolve to Advance etc etc.

          I see this as analogous to the Airbus concept where there is again clear evolution from one development to another. Thus spreading development costs and bringing a homogeneity to all products.

          My view is that whilst making some fantastic products GE and Boeing are more guilty of having projects in silos. The crossover between the products are less pronounced with less commonality and enhanced development costs.

      • It wasn’t the CF6 that was unsuitable, it was the military TF39. Andrew Porter’s thesis is that the technology taken surreptitiously from RR allowed GE to come in at the last minute and put forward a viable technical proposal to supplant the RR engine (which had already been selected by both McD and American Airlines and who had already called the press conference for the announcement) with a modified TF39 called the CF6. Best read the book for the detail.

        Interesting to speculate on the Unintended Consequences, though. If RR had been the exclusive powerplant on the DC10, RR would not have had the resources or the will to take on the L1011 a couple of years later and there was no suitable US engine. So there would probably have been no Tristar. McD would have taken all of the tri-engine wide-body market and would probably have then had a market success. McD might then not have been taken over by Boeing.

        As Matthew says below, GE were given a huge leg-up in the wide-body market by US government protectionism and British government compliance , but then seem to have wasted the lead. GE certainly did not take RR out of the market and now have RR as their only serious competitor in the wide-body market.

  11. Launching a big twin wounding MD and LM trijets was an evil act, on top of the history above..

    Imagine Nokia suing Apple, asking for import tariffs in two forms: one for dumping the phones at prices below that sold in the home market (USA) and one for “injury” to Nokia.

    “Nokia told its investors conference last week it’s pursuing this complaint about Apple to avoid another Apple emerging and destroying Nokia and the European phone industry—an idea included in Nokia’s filings with the EU commission”

    Crazy isolationism.

    Did they value repercussions? Boeing is the US’ biggest Exporter and they need friends on the 737 and 777. E.g. Air Canada (bailed out by Ottawa) .

    • International trade atom bomb. No one has any idea where this will end up, and I have yet to read of any one giving it much thought in the wider context. Maybe more like ebola.

  12. If Delta had a leasing Company take over the C-series contracts, they could lease the same N-registered aircraft and fly the routes they are intended for? Udvar can for sure help and Boeing will think twice before making him angry.

    • Was wondering if Endeavor Air or Skywest could take over the CS100 order at a price that is not regarded as dumping and then operate the CS100’s for Delta Connection.

      Guess there is a reason why Delta didn’t want to go the Delta Connection route with these aircraft.

    • Hello Claes,

      Regarding:” If Delta had a leasing Company take over the C-series contracts …”; the basic US Anti-Dumping statue, 19 USC 1673, states the following.

      “For purposes of this section and section 1673d(b)(1) of this title, a reference to the sale of foreign merchandise includes the entering into of any leasing arrangement regarding the merchandise that is equivalent to the sale of the merchandise.”

      Criteria for determining whether a lease is “equivalent to the sale of the merchandise” are set forth in 19 USC 1677(19). These criteria include the following.

      (D)
      whether the product subject to the lease is integrated into the operations of the lessee or importer,
      (E)
      whether in practice there is a likelihood that the lease will be continued or renewed for a significant period of time, and
      (F)
      other relevant factors, including whether the lease transaction would permit avoidance of antidumping or countervailing duties.

      Based on the above cited USC sections, the chance of an airline evading anti-dumping penalties on a particular aircraft model that it had ordered, by instead leasing a similar number of the same aircraft model and operating them in its fleet for 10 to 20 years, is pretty much zero; however, an airline leasing aircraft for a period of several months to cover a period of peak demand, without having had a prior contract to purchase the same model aircraft, would have a pretty good chance of evading any anti-dumping duties in effect for that aircraft type. See below for the full text of the USC sections that I cited above.

      Note also that the criteria for anti-dumping penalties in 19 USC 1673 do not require actual sales or actual injury, but only the likelihood of sales or threat of injury.

      19 USC 1673
      If—
      (1)
      the administering authority determines that a class or kind of foreign merchandise is being, or is likely to be, sold in the United States at less than its fair value, and
      (2)the Commission determines that—

      (A)an industry in the United States—
      (i)
      is materially injured, or
      (ii)
      is threatened with material injury, or
      (B)
      the establishment of an industry in the United States is materially retarded,
      by reason of imports of that merchandise or by reason of sales (or the likelihood of sales) of that merchandise for importation,
      then there shall be imposed upon such merchandise an antidumping duty, in addition to any other duty imposed, in an amount equal to the amount by which the normal value exceeds the export price (or the constructed export price) for the merchandise. For purposes of this section and section 1673d(b)(1) of this title, a reference to the sale of foreign merchandise includes the entering into of any leasing arrangement regarding the merchandise that is equivalent to the sale of the merchandise.

      19 USC 1677
      (19)EQUIVALENCY OF LEASES TO SALES
      In determining whether a lease is equivalent to a sale for purposes of this subtitle, the administering authority shall consider—
      (A)
      the terms of the lease,
      (B)
      commercial practice within the industry,
      (C)
      the circumstances of the transaction,
      (D)
      whether the product subject to the lease is integrated into the operations of the lessee or importer,
      (E)
      whether in practice there is a likelihood that the lease will be continued or renewed for a significant period of time, and
      (F)
      other relevant factors, including whether the lease transaction would permit avoidance of antidumping or countervailing duties.

        • Hello Transworld,

          I was trying to provide a primary source, i.e., the law itself. that people could make their own judgement on, rather than making a statement of fact based on my interpretation of something that it seems most people either don’t know how to look up, or don’t have much interest in looking up. By my reading, the law is pretty clear. If you lease something that has antidumping or CVD penalties on it, and use it in the same way that you would have used it if you purchased it, you won’t circumvent antidumping or CVD penalties, this is especially the case if the lease is for something that you had ordered, but the order was canceled because of the antidumping penalties in question.

          For some reason people here, in the media, and the Canadian government, focus on the antidumping case and make little mention of the separate coutervailing duties (government subsidies) case. If Bombardier had been bailed out by a private investor group, instead of the Canadian government, I supect that Boeing wouldn’t have bothered with a complaint.

          • Interesting as DL allegedly got a súper deal can they now set up a leasing business in Ireland and lease them to other parties? Maybe Virgin Atlantic? Then when EK takes the first 777-9 open an antidumping case as EK are getting aircraft which are subsidized be Washington state. This could end up getting absurdo.

    • Maybe Air Canada will take the Delta order and then lease the jets to a US company.

  13. @ Anton you are forgetting the scope clause. The cseries is too heavy and that to much passengers seats. Anything over 76 seats and 86 000 lbs have to be flown by delta main airline not delta connection according the pilots contract i.e. the scope clause.

    • Thanks, how is the 76 determined, in airline layout or how? Also, is 86KLb OEW, MTOW or whats the measure for the weight?

  14. A balanced ruling will be is to give BBD and Delta a period X to come up with a new purchase price that’s acceptable to he US authorities?

    • How would they go about deciding a reasonable purchase price?Definitely not by trying to compare it with a 737. Who knows how many planes bbd will eventually sell? Having said that, I think that most people would agree that the price was too cheap.

  15. To counterbalance all this “dumping” on Boeing above, google and read Andrew Coyne’s 9/22/17 article in the (Canadian) National Post. Very enlightening on the history of Bombardier’s Canadian government bailouts/subsidies, its managerial incompetence, and suspect, cozy Quebec crony capitalism!

    • Subsidies and dumping are all around in our industry. And Boeing isn’t excluded, contrary. While presented by euphemisms like “extra ordinairy measures”, “level playing field”, “stimulation”, “Innovation” and “tax cuts” for naive voters, we know the deal.

      https://www.washingtonpost.com/business/economy/boeing-received-illegal-tax-breaks-from-washington-state-wto-rules/2016/11/28/0596013c-b575-11e6-959c-172c82123976_story.html?utm_term=.e2ea627ccb2d

      http://www.businessinsider.com/boeing-took-some-extraordinary-measures-to-crush-its-canadian-opposition-2016-3?international=true&r=US&IR=T

      It’s join in or get out.

    • To read to you, MontanaOmy…, it is clear that you are not aware of how some English-speaking newspapers in Canada amuse themselves by breaking sugar on the backs of Quebeckers and Bombardier. In Quebec, guess what the people do with the National Post?

      • I can guess, LOL. But is anything Coyne lays out in the article incorrect? (“No”? I didn’t think so.)

        • You’ll notice Andrew Coyne’s articles on Quebec, and BBD in particular are allways, let’s say, biased on the same side.

          This guys wants a strong central (federal) gouvernment, and he seems to perceive Quebec as an obstacle to this.

          In regard to the above, I suspect Boeing did not expect such really in support of BBD.
          Quebecers tend to want a more decentralized country – along the lines of the original “contract” signed in 1867…

          Centralizing guys like Coyne (and many anglo Canadian papers) have somewhat a search and destroy approach with anything pertaining to Quebec

          • “In regard to the above, I suspect Boeing did not expect such really in support of BBD” should have been the last paragraph, sorry.

    • @MontanaOsprey

      National Post is not really worth the paper it’s written on.

      But hey! Feel free to bring up any points that you feel is worth discussing.

      • Wow, that Quebec provincial government must be “swimming in cash”, what with a billion or so U.S. large to just throw on the table for a 49.5% in the CSeries LLC, LOL!

        • So that $1B for a 49.5% equity in the CSERIES represented about 35 cents on the dollar.

          Now that both models are certified, in service and exceeds promises, is not a sound investment?

          I find this equity investment way better than the $Bs tax breaks Washington State is providing…

          Or the Billions to bailout the (US owned) auto assembly sector where little R&D is performed here.

  16. “In May 1979, an American DC-10 took off from Chicago. Before lift-off but after the plane was committed to take-off, the left engine separated from the aircraft.”

    And a young journalist by the name of Scott Hamilton, who was then working for a local Chicago newspaper, was assigned to cover this tragedy. And if I am not mistaken this is what launched for him a long and successful career in aviation journalism. And a few years later he would return to his native Seattle to cover Boeing, which a few more years later would do the exact opposite by leaving its native Seattle to go to Chicago.

    But the irony doesn’t stop there, for this terrible accident contributed to the demise of McDonnell-Douglas along with the refusal (or incapacity) of one Harry Stonecipher to invest in new products, and who would become later on CEO of Boeing.

    And if we want to push the irony even further, it is interesting to note that Boeing, which was lead by Stonecipher at one time, is now suing Bombardier, which is now lead by Alain Bellemare.

    Well, the irony is that Bellemare was once president of Pratt & Whitney Canada while Stonecipher was at one time VP of GE. After P&W Bellemare became CEO of Hamilton Sunstrand, while after GE Stonecipher became CEO of Sunstrand. And after Hamilton Sunstrand Bellemare became CEO of Bombardier, while after Sunstrand Stonecipher became CEO of McDonnell-Douglas.

    So there would be one more thing left for Bellemare to accomplish in order to complete the parallel with Stonecipher and that would be for Bombardier to buy Boeing with Boeing’s money and become CEO of Boeing. 🙂

    • @Normand: I’m actually a Chicago area native, but haven’t lived there since 1985.

  17. I generally agree with scott re revisionist history. After all Lockheed tristar had faded long before Gatt92 ( now WTO ) which was designed to give ( now ) Airbus a better chance in the ” LCA” market via supposedly limited subsidies, etc. Douglas folded into MDC simply cuz they had let the costs of their then stable of airplanes become so opaque there was too much month at the end of the money and McDonnel had cash from miitary business. How and why that happened has been documented. The most likely IMHO resson BA is putting thst out is cuz the ones running the store now may well have been in diapers at the time.

  18. Can’t Bombardier use accounting blocks to show the average cost is not dumping. By the same token could Boeing be charged with dumping 787’s?
    I wonder if they will ever get out from under that projects crazy costs.

    • Hello John,

      US Antidumping law does allow cost of production (COP) or constructed value (CV) to be adjusted for “startup costs”. See the following excerpt from Chapter 9 of the USITC Enforcement and Compliance Division Antidumping manual, which may be found at the link following the excerpt.

      “c. Start-up Operations

      We allow respondents to adjust their reported COP/CV for higher than normal costs incurred as a result of the company being in a startup operation. In brief, start-up operations are those operations where a producer is using new production facilities or producing a new product
      that requires substantial additional investment, and the production levels are limited by technical factors associated with the initial phase of commercial production. See section B.5.d. of the SAA at page 165. The 1994 amendments to the Act specifically addressed when an operation is considered to be in a start-up mode and how to account for the costs associated with start-up. Consult with your supervisor or PM when there is a claim for a startup adjustment. See section 773(f)(1)(C) of the Act and 19 CFR 351.407(d) of the Department’s regulations for additional guidance.
      In making a startup adjustment, we generally compare the per-unit manufacturing cost experienced by the respondent during the first month after the end of the startup period to the per-unit manufacturing cost experienced during the startup period. If the per-unit manufacturing cost during the first month after the end of the startup period is lower than the
      per-unit manufacturing cost during the startup period, the adjustment amount is the difference in these per-unit manufacturing costs times the production quantity during the startup period. The adjustment amount is a reduction to the reported costs. As the startup adjustment results in a
      certain amount (of actual production costs incurred during the startup phase) not being counted, the difference between actual production costs incurred and the adjusted cost of production (i.e., the adjustment amount) will be amortized subsequent to the startup phase over a reasonable
      period of time (e.g., over the life of the product or machinery). See section B.5.d.(3) of the SAA at page 167.”

      Boeing’s cost estimates in their petition for antidumping and CVD penalties included startup cost adjustments. The following is from pages 123 and 124 of the redacted version of the Boeing complaint, to which Scott posted a link in April of this year.

      “Both the Air Canada and the Delta orders are scheduled for deliveries early in the program’s life cycle. Because of the “learning curve” effect, the actual variable manufacturing costs in those years will greatly exceed the average variable manufacturing costs over time. Therefore, as a conservative measure for its calculation, Boeing used average variable manufacturing costs, expressed in constant U.S. dollars, over the life of the C Series program. These costs have been spread over the projected number of deliveries over a twenty-year period,which is a reasonable estimate for the life of an LCA program. In essence, for purposes of this petition, notwithstanding the limited grounds on which the Department will grant a start-up adjustment under 19 C.F .R. § 351.407, Boeing has applied a start-up adjustment to Bombardier’s POI production costs. In its normal books and records, Bombardier, following International Financial Reporting Standards (“IFRS”), does not allocate learning curve costs over the life of
      the program. Thus, Boeing’s calculation.of Bombardier’s recurring costs is very conservative.

      To estimate Bombardier’s recurring costs, Boeing constructed a Bombardier recurringcost curve model using the following known information:
      • Bombardier’s published delivery schedule;
      • The published break-even point of the first quarter of 2020;
      • Bombardier’s expected loss ofUSD 32 million per unit over the first 50
      aircraft·
      • Published list prices; and
      • Boeing’s own experience on the shape of the cost curve for a new aircraft series.

      In addition, Boeing assumed the following:
      • A total production run of 2,085 units for the C Series program; and
      • An average list price discount for the first 206 aircraft of 50%.
      Boeing’s estimates of Bombardier’s production costs are provided at Exhibit 42, Tab 3. A, detailed explanation of the model and how the public data were incorporated into the model to derive Bombardier’s production cost for the C Series is provided at Exhibit 152.”

        • To me Boeings submission doesn’t reflect Boeings recent experience, last new Boeing type was 787, early aircraft allegedly cost 400 millón, about 3 times early sale prices. It took nearly 500 airframes worth probably 60 or 70 billion before they broke even on a per frame basis. Expect Canadian retaliatry measures against US swing states in NAFTA renegotiations. As Russia got away with messing with the US elections, why not?

  19. What was the difference in pricing offered in Canada and the U.S.?

    Are Boeing and Airbus always pricing their products more expensive across the globe than in their home countries? I really doubt that.

    By definition, Airbus and Boeing are dumping aircraft across the globe, multiple times on a yearly basis.

    Boeing, Ryanair? Were all U.S. carriers offered similar pricing?
    Airbus, Air Asia or whoever?

    • Most of the countries in the world don’t have competitive airliner manufacturers,so it’s not an issue.

      • Does the wing facility in Belfast count? I understand dumping a product like lumber, but an airliner with a global supply and manufacturing seems a little more difficult to define the rules.

  20. I think there is a bit of nuance involved here.

    While Lockheed shot itself in the foot with a sole source on a unreliable RR (seems they are still having problem’s delivering) and DC and MD had issues, Airbus was lurking in the wings and took advantage of that.

    Not stated is the fact that you could not do over water flights with two engines (or any real distance).

    Airbus ignored that more than two engine requirement as did the Asia countries and that’s where the A300 sold (and I got my first and only ride in one, nice aircraft despite the fact I was not happy to be flying from Taiwan’s infamous Chang Kai Chek International to the Philippines (lots of water) with only two engines.

    If not for that what would the Asian airlines flown?

    On the other hand it also does not account for the 767 that would have killed the triples as well.

    And in the end Boeing did the 777 flying very long routes over water (super ETOPS) with Airbus saying, but but you need 4 engines if you are doing to do that (4 for the long haul!)

    Etu Brutai indeed.

    And I continue to be curious if Delta/BBD could kill the deal and just lease C series from BBD?

    • For me the first twin long flight over water was a surprize when you realize this plane have only 2 engines. The worst for me was to do it a few days later going back the other direction when you had time to think and knew it will only have 2 engines.

      With the talks of an NSA and Bjorn series on electrical aircraft I was wondering about a single jet engine aircraft with two electrical back-up engines?

      My 1st long over water flight with the single prop engine Malibu was also something I won’t forget.

      • For some US airlines at the time, eg Eastern, didnt have long overwater routes. The only long haul airlines pre liberalisation were PanAm Northwest and TWA. But the important at the time over water route was to Hawaii. But the Boeing 767 came out not long after the A300, which showed that a twin wasnt really a problem after all and Airbus introduced a direct competitor, the A310.

    • “Airbus ignored that more than two engine requirement as did the Asia countries and that’s where the A300 sold”

      Those customers worked their planes under ICAO derived 90minutes instead of the 60 minutes FAA rule that would be
      superseded by FAA ETOPS the moment Boeing went for a twin engine airframe ( 767 ). Look into what the complete FAA job description entails.

  21. Might be a good idea to Canada to imposed to USA an export taxes (or anything you could call), a 20% taxes to oil extracted in Canada to be shipped to USA! That could slow down the crazy dumping between USA and Canada!

    • Better yet, impose a tax on 737s sold to Air Canada , WestJet and Air Transat to be delivered yet.

      If the ITC concludes that the CS100 competes with the 737 MAX 7, Canada may then conclude the MAX 8 competes with the CS300…

  22. No one seems to be disputing the fact that what Bombardier did was wrong, but rather focusing on Boeing’s reaction. What if Boeing decided to sell 737’s to Air France for $10 million a piece just to get them to switch from the A320 series. We all know Air France wouldn’t normally go Boeing for short haul, but that price would be too good to pass up. Don’t you think Airbus would take issue with Boeing price dumping?

    Just because Boeing is the larger more financially stable manufacturer means they shouldn’t protect themselves? We can argue all day that all these companies have taken some form of government supported subsidies, but that doesn’t justify one company dumping prices.

    • @Bungo: There are a few things about your statement to correct:

      1. Boeing’s basic thesis that Bombardier sold the airplanes to Delta below cost is ridiculous. One need look no further than the 787 program in which every airplane sold through 2015 was below cost. (If it weren’t for program accounting, this might still be the case.)
      2. Every, and I do mean every, airplane program sells below cost during production ramp up. BBD is no different.
      3. Boeing takes advantage of program accounting, about the only major industrial to do so. BBD (and Airbus, for example) practice unit cost accounting. They have to write off costs as they occur, not accumulate $30bn in deferred costs.
      4. Boeing sold the 737-700 to United at an extremely low cost to block a CSeries sale there.
      5. Boeing sold Air Canada 787s and the MAX at a very low price to get AC to switch from Airbus to Boeing. Some allege Boeing took a loss on this sale, though LNC hasn’t attempted to analyze this. Boeing also took in on trade 20 E190s, which were later sold to Delta.

      • Think this is a case where Boeing has shaken the tree and their own monkeys are starting to fall out of the tree?

      • I am totally for BBD on this but pricing could be challenged to be on the “edge”.

        But how can they justify to apply a tariff for aircraft form 100-150 seats, maybe 100-125 seats, which is also silly as Boeing has nothing to offer in that size.

        This is so obvious they also targeting the CS300 its embarrassing.

        Boeing could be its own worst enemy here and we could see the launch of an CS5 (155-160 seats) rather sooner than later?

    • … and Boeing sold United 777 at a bargain price. Nothing wrong with that. They need to keep the 777 line going until the 777X comes along.

      But returning to the DC-10/Tristar situation. The DC-10 was engineered for the positive not the negative. The Tristar was engineered for both the positive and the negative. The word is failsafe. The DC-10 was not failsafe, Tristar was failsafe.

      Why? MD wanted to beat Lockheed to market with a ‘better’ airplane. They did beat Lockheed to market. On paper, the DC-10 was better, but that is easy when you don’t insert the metal for failsafe.

      Never happened since, thank God. The Tristar was a great airplane, undone by very poor behaviour. It cost Lockheed its commercial business, but the same happened to MD.

      Never flew on a DC-10. Tristar, many, many times!

      • @philip:
        “Boeing sold United 777 at a bargain price.”
        And @ least twice. 1st time when 777 program was launched in 1990 and UA secured launch pricing(1st ever 777 delivery in 95 was to UA too). Last time was the famous sweet-heart deal for end-of-line 77Ws in 2015. Both times helping Boeing significantly re 777 program even though both events separated by a quarter century.

        Interesting symmetry there too: Launch pricing vs End-of-line pricing

    • In terms of specifics and anti dumping legislation it appears Boeing may have a technical win. In terms of natural justice it is just nonsense. A senior British judge once said ‘the law is an ass’ and it certainly is here.

  23. Several bribery scandals that emerged in the 1970’s at Lockheed for its defense division, and to drive sales of the L1011 TriStar (which along with the 747 remain my personal favorite airplanes by far) at Japan’s All Nippon Airways (ANA) and at Saudia Arabia’s Saudia, but perhaps best remembered by those of us of a certain age by the former which brought down the Japanese Prime Minister, Kakuei Tanaka, and forced Lockheed’s Chairman of the Board, Daniel Haughton, and the company’s Vice-Chairman and President, Carl Kotchian, to resign in February, 1976 also contributed to Lockheed’s problems, and the demise of its L1011.

    Just another factor Boeing conveniently overlooks, or “writes out” of history in its revisionist account in an attempt to kill-off, or severely impair, Bombardier’s much better than Boeing’s “pre-historic” (in aviation “years”, and as a figure of speech 😉) 737s that most passengers stuck in a 30-31″ pitch row for more than 90 mins dread with an unbridled passion…

  24. The national flag carriers of Europe has subsidized Airbus from the beginning . They bought everything Airbus produced. Lufthansa and SwissAir were at the time big DC-10 operator. Many European carriers were operating the MD-80 variants. The string of accidents that occurred during the first years 0f the A320 haven’t deterred them from placing huge orders to the plane in contrast , if we take the article position , to their attitude towards the DC-10 and the MD-11 .

    • British Airways was very reluctant buy Airbus, it used to known as Boeing Always. Air France has plenty of 777s,Lufthansa is one of very few 747/8 operators. Swiss air went on purchase MD11s. Why should they have purchased inferior aircraft? Boeing did fine.

      • Who is going to be the big losers here, US airlines that can’t buy the best.

        BBD can sell their aircraft all over the world.

      • Can you specify an Airbus plane that they did not purchase? Look at their historic and current fleet. You mention the exceptions . And the list of European airlines goes on and on. And all of them either failed ( Air Berlin and Alitalia are recent examples ) or achieving very mediocre results.

        • British Airways didn’t order any airbus until 1998 when it ordered the technically excellent A320. A couple of A318 for a special mission and a few A380 in 2007.Thats it, all the rest are Boeing. They are still the biggest 747 operator and don’t operate the incredibly popular A330.
          There are certainly political pressures, but I can’t see any reason European airlines shouldn’t purchase competent Airbus products (which include a lot of US components)
          Why did the rest of world not want MDs planes either?
          Ever heard of Ryanair or Norwegian?
          I just can’t where your argument is going.

          • “competent Airbus products ” LH volunteered to accept a limping 320Neo rejected by Qatar. Was this done in best interests of their share holders?
            Do you call Ryanair or Norwegian flag carriers ?
            Britain was the latest to join the Airbus consortium . This was reflected for many years in BA fleet .

          • LH almost certainly accepted the otherwise perfect US engined Qatari reject in the best interests of its shareholders, possibly paid by P&W. Although not formally part of Airbus at the start, the wings have always been made in the UK. Air Berlin is not a flag carrier either. I’m not a fan of government owned flag carriers but I don’t think buying airbus is the cause of their problems.
            Why did US carriers buy Airbus planes if they were no good? Remove your star spangled specs for a clear view.

          • When it purchase British Caledonian it actually became one of the earliest A320 operators.

        • @David

          The fact of the matter is that the former national flag carrier of the United States — Pan Am — and the “Big Four” domestic airlines in the United States — TWA, American, United, and Eastern — subsidised Boeing from the very beginning . They bought everything Boeing produced. While the former European flag carriers bought a huge amount of Boeing aircraft, sales of European produced aircraft to Pan Am and the US legacy airlines were few and far between. Not until Eastern Airlines acquired A300s in 1977 started things to change.

          • OV-099
            For a long time every passenger airline was produced in the US. I don’t have in front of me their historic fleet but I am sure you would find there DC and Lockheed planes as well.
            “Eastern Airlines acquired A300s in 1977 ” – How much did it cost? . I have a feeling that not much , so were probably the price of the first A320’s sold to US operators at the time ( I don’t have the details of who the first customers were). And this is the crux of the matter now. Bombardier may sell their aircraft not dump them.

          • @David

            “For a long time every passenger airline was produced in the US”

            Nonsense.

            Haven’t you heard about the de Havilland Comet, Sud Aviation Caravelle, Fokker F-28, BAC-111 etc.

            The fact of the matter is that Boeing and MacDac/Lockheed etc. in the 1950s, thanks to their participation in large military contracts, developed the technology and expertise necessary to make large civilian airliners. Hence, the commercial products they were able to offer to the world in the 1950s and 1960s owed their impressive industrial capabilities and dominant market position to government funding, with the added advantage of a huge home market — a market much bigger than any of the home markets of any of their European competitors.

            As for Eastern Airlines and the A300 — and the rise of Airbus — I’d recommend reading this article from 2003:

            The Contender
            How Airbus got to be number one.

            In the dark days of 1976, Thomas recalls, “we had a meeting of 25 or 30 people, with this gentleman I had never seen before.” Bernard Lathiere was a graduate of the Ecole Nationale d’Administration, where France trains its elite, and he had been sent on a mission: Step in as president, replacing Ziegler, and either kill Airbus or save it. A sharp contrast to his immediate subordinates, the lean, ascetic Beteille and Kracht, Lathiere was a florid glad-hander, a natural speaker who became Airbus’ chief salesman.

            One light gleamed: Western Airlines had ordered eight airplanes, with an option for four more. It was the first time a U.S. airline had bought a European jet since 1964. But at the end of January 1977, Western announced it had ordered 727s instead. Airbus canceled orders for long-lead items—parts that would be needed for aircraft delivered in 1979. It was close to the end.

            Then, in April, Thai International ordered four airplanes. And Eastern Airlines, losing money and desperate for modern aircraft, agreed to accept four A300s on a no-charge, six-month lease. If Eastern found the A300 as cheap to buy, operate, and maintain as advertised, it would buy 28 airplanes on very favorable terms for the airline. In April 1978, Eastern signed up to buy 23 A300s.

            http://www.airspacemag.com/flight-today/the-contender-3630193/

        • I remember when around the mid 90s all the central and east European operators, all went on a B737 buying spree. I mentioned this to one of their tech reps that was doing the same rounds as me. He said in so many words that it was a tie in to US govt assurances. Sales to flag carriers have always been subject to geo political interference. Re the big European carriers I think it was a mixed picture and to suggest a string of accidents is to make too great a case for this.

          • @OV-099
            “Nonesens” ?? – Have you read what you copied and pasted? – ” And Eastern Airlines, losing money and desperate for modern aircraft, agreed to accept four A300s on a no-charge, six-month lease. If Eastern found the A300 as cheap to buy, operate, and maintain as advertised, it would buy 28 airplanes on very favorable terms for the airline. In April 1978, Eastern signed up to buy 23 A300s.” – They got these airplanes for n0-charge six month lease and then “favorable” terms. In modern language of 2017 this is called dumping.
            By the way , a quick glance at the BAC-111 Wiki entry told me that AA operated it.

          • @David

            You claimed that: “For a long time every passenger airline was produced in the US”.

            That’s nothing but nonsense.

            Again, as for Eastern Airlines and the A300; it just goes to prove that it wasn’t the European flag carriers that kept Airbus afloat from the end of 1975 until April 1977, when not one aircraft was sold.

            As for your last point — and as I’ve already pointed out in my comment above — while the former European flag carriers bought a huge amount of Boeing aircraft, sales of European produced aircraft to Pan Am and the US legacy airlines were few and far between.

    • @David: Your statement that “The national flag carriers of Europe have subsidized Airbus from the beginning” is a very strong, unrealistic overstatement. Also you trying to correlate Airbus with airline bankruptcies is ludicrous.

      I could also list many European airlines that were purely B737 operators and went bankrupt. Such a correlation would be however completely unfair to Boeing.

      Boeing also developed most of its center bodies (B707/72-3-57/747/767/777 through programs financed by the Pentagon (US Taxpayer).

      I don’t say that Airbus does not use political influence (they do, just as Boeing does it) but generalizing it in such a way is highly hypocritical and opens a can of germs for a public mud fight.

      People living in very big glass houses think they are made of concrete…

      • @Fernec
        Just to be clear – I have no connection at all to Boeing and I certainly don’t live in a big glass house. I am just an airline industry enthusiast which don’t like the anti Boeing sentiment reflected so much in this and other sites . I think that since the 787-8 debacle , Boeing has improved a lot . Unlike current Airbus , they deliver on time what they promise to deliver. On the other hand Airbus has an excellent PR which covers a long string of failures , some of them current.
        I know that airline operation is very complex and it’s outcome cannot be pinned down to a selection of this type or the other. But I am old enough to remember an old saying in IT which stated that “No manger was ever fired because he choose IBM”. I know that my claim is not based upon an historic research but on my feeling which was firstly triggered watching the poor selection of A340-600 over B777 made by Virgin. They then were on the verge of beating BA .

        • Virgin (not a flag carrier, but still susceptible to political pressure) has never been near beating BA.The A340/600 did turn out to be a slightly sub optimal choice, something that state owned Air France, as well as British Airways spotted and avoided, choosing Boeings instead. I think that the decision was made on launch pricing, but the Rolls-Royce engines were probably something to do with it.
          I not anti Boeing, there’s a good reason why they are making twice as much money as Airbus.They are correct that Bbd would be out of business without Canadian government help,it is impossible to enter this market without a lot of state assistance. It’s just that all this legal stuff is hypocritical and in the dumping case, ridiculous.

          • @Grubbie
            “I think that the decision was made on launch pricing, but the Rolls-Royce engines were probably something to do with it.” – I remember very well Richard Branson claiming at the time of signing the contract that he accepted Airbus claim that 4 engine airplanes are safer then the 777 twin on the long range routes. This claim was public. I don’t know of any other consideration that probably were there as well.

    • We will also need to replace our few remaining (& worn out) Chinooks…
      ———————————————
      Further down the road, the RCAF will also need new maritime patrol aircrafts (to replace Auroras), new air refuelers (to replace A300s) and general transports (also A300s)

      Those could be sole sourced to BBD.

      By a curious coincidence, the airframe specs would correspond exactly to the CS500…

      Boeing cross finances / engineers its defense contracts with its commercial products, why not BBD?

      Ironically, the last homegrown RCAF MPAs were Canadair built CL-28 Argus. They were about the best MPA airframes in its time. (Had an endurance of approximately 26½ hours with full armament)

      https://en.wikipedia.org/wiki/Canadair_CP-107_Argus

      • 26.5 hours?!?! Goodness, that’d be a recipe for a numb posterior. I wonder if there was anywhere to stretch the legs?

        Endurance is fantastic for an MPA on an ASW patrol, especially if going after a diesel sub. Keep it submerged and it runs out of air, and has to surface. It’s no good if you have to run off to a in-flight refueling tanker for half an hour, that’s enough time for the sub to come back up and get a new hull’s worth of fresh air, do a useful battery charge, etc.

        • Diesel subs are mostly moving towards having AIP as an additional mode – at low speed they could stay down a week

      • Found here a nice short video on the CL-28 Argus design, and construction at the Canadair Cartierville / Montreal plant.
        The Canadair Sabre were still being built at Cartierville during the same period.
        (FWIW, Canadair Starfighters were later built there also)

        https://www.youtube.com/watch?v=424oXB6-44Y

        This Bombardier/Bombardier Cartierville plant is still busy now, making the CSeries cockpit section, among other things.

  25. I am not trying to market the CS100 but BBD also needs to think outside the box. Ethiopian Airlines is the rising star in Africa. Their Hub is Addis Ababa, a hot and high airport.

    The CS100 with its range and capabilities could reach numerous lucrative smaller but longer range destinations with direct links from this Hub!

    • Most of their 737 fleet is the larger -800 model. For a small airline like that having a separate smaller plane doesnt make sense.

  26. I would argue that the demise of the comercial aircraft business for MD actually came much earlier – it was the DC-9 being sold at too low prices and logistics problems with the launch and development of that program that resulted in Douglas running in to financial difficulties and as a result being acquired by McDonnell.

    This is an interesting paper for anyone with the time to read it:
    https://faculty.haas.berkeley.edu/leonard/Active%20Papers/What%20Killed%20Douglas%20Aircraft.pdf

    • According to Wikipedia a total of 976 DC9’s were produced that were involved in 117 incidences resulting in 101 hull losses and 2135 fatalities.

      You can’t blame Airbus for this.

  27. If Boeing manages to exclude the Cseries from the US market, then the Canadian government will be free to subsidise the CS 500?

  28. @scott, why doesn’t the NAFTA “free trade zone” completely obviate this complaint to the point that the US market _is_ the BBD domestic market?

    • Interesting point, before NAFTA there was the US- Canada FTA in 87 to which Mexico was added in 94 to get NAFTA.
      Mostly these things are about elimination of tariffs but what constitutes ‘fair trade’ does come into it.

  29. Business is not some sort of gentlemanly duel, it is war. Boeing is only doing what is expected in business: win by whatever means possible. And if not Boeing, EMB could have challenged the sale as Scott wrote about over a year ago: “Embraer may ask the Brazilian government to file a complaint with the World Trade Organization (WTO) over government support for Bombardier (BBD) for its C Series.”

  30. What if, for US orders only, Bombardier moves the required amount of manufacturing or financial assembly to US? I understand 50% of CSeries content is already US. Right? So, can bbd not find a way to move whatever portion of the manufac or assembly qualifies it for made in USA into USA? They already make some planes here albeit maybe smaller sizes. And I don’t get the impression that their final assembly plant in Mirabel is a paragon of capital intensity only 1 of its kind type thing. Sure, I would expect this to cost them money overall, but vs. being shut out of the market or paying untenable tariffs … besides, it would mean they can “dump” all they want, like what, I am a local Google old boy too. The obvious problem with this is the Canadian governments and workers won’t like it. But again, only for US orders, and temporary too. Is this a non-starter, what am I missing?

      • You made me look at airports near Montreal in the US.

        The nearest I could find is Plattsburgh, 100km from Montreal and 40km south of the Canada Border on route 87. So start towing!

        An International airport with what looks like a nice 3.5Km concrete strip, if developed this looks like a nice spot LCC’s from Europe could fly into (25ooNm from Shannon)?

      • @Grubbie:
        “Just tow it over the border and fit the side stick..”
        Or fly each assembled CS1 frame for U.S. customers to BBD Wichita manufacturing base where their Learjets are assembled. Complete the cabin installation+paint job and deliver to U.S. customers right fm that site. That should make each CS1 containing over 50% U.S. made content.

        The beauty of the above plan is that little to no new investment required by leveraging existing BBD facility+manpower in Kansas.

        • Wonder what is the percentage for an A320NEO with PW1100G’s assembled at Mobile?

          • Very little US content gained from the final assembly in Mobile as the fuselage sections/wings/engines are just shipped in.
            The value added is really in the creating of the major parts and the IP involved. This would show in the numbers of staff involved on site.

  31. Here’s a thought. Canada and the UK get together to produce a new NSA/NMA all carbon airplane with RR Advance/UltraFan engines. Boeing/Airbus are creaming it with dinosaurs. Easy meat to beat both the 737 and A320!

    The UK will support Canada, the CS100/300 won’t go down!

    • Hope so, but why should US airlines be prevented or things made difficult for them getting the best 100-150 seat aircraft for their fleets.

      Airlines all over the world are benefiting from Boeing selling their aircraft at very low prices abroad. Boeing’s plan/excuse is that will make money with their full maintenance programs?

    • Float over and we’ll meet up somewhere in the middle of the the Atlantic,to escape our problem neighbours. Then we can get together and use our well honed skills to make a mess of trying to develop an airliner together. It’ll be fun.

  32. The relationship between Delta and Boeing, according to Delta CEO Ed Bastian. From the Puget Sound Business Journal Article at the link after the excerpt.

    “Q: Your airline is shopping for 75 or more new single-aisle planes, a multibillion-dollar order. Analysts have suggested Airbus will win it because Boeing filed trade complaints about your decision to buy Bombardier C Series jets. Does Boeing have a shot?
    A:Absolutely they do. I know there’s been some (speculation about) frustration between (the companies about) the Delta relationship. I can assure you that that is not the case. I’ve met with Boeing CEO Dennis Muilenburg. I’ve met with Boeing Airplanes CEO Kevin McAllister. We’ve reaffirmed the strength of our relationship. I’ve known Kevin for years through (his previous job at) GE.

    Q:Are you meeting McAllister or Boeing people while you’re in Seattle?
    A: No, Kevin comes to see me. I don’t have to come see him. Delta is the second-largest operator of Boeing jets in the world, next only to Southwest Airlines of Dallas. Including Delta’s ownership stakes in our affiliates AeroMexico, Virgin Atlantic, Gol Linhas Aereas of Brazil and China Eastern Airlines, we are the single-largest airline operator of Boeing aircraft equipment in the world. We have every reason to maintain that relationship, protect that relationship, invest in that relationship and nurture it for the future.

    Q:What factors will sway your decision?
    A:Price is very important but not the only factor. It’s not the only (one) by any means. Availability, delivery slots, the quality of the product, the efficiency of the product for fuel and other reasons, the range. There’s a host of characteristics that are different between the Airbus and the Boeing product that we have to look at. We want both companies to have the best shot and put their best foot forward and we’ll make a decision hopefully by the end of the year.”

    In the reality that I live in, I would be surprised if a Fortune 500 CEO’s answer to “what factors will sway our decision?” did not begin with with “Price is very important”.

    Perhaps one should take into account that the interview took place in Seattle and Mr. Bastian wanted to make it to the Seattle city limits alive? It does seem that Mr. Bastian may have spent more time in charm school than former Delta CEO Richard Anderson.

    • Now, China really could apply some pressure to Boeing. Just like North Korea, they just stand back and let things develop.

      • Like buying a stake in the CSeries program, be the CS500 launch customer and/or set up a CS500 FAL (at COMAC facilities).

        • My head was working in that general direction, but wonder if tariffs are imposed on 100-150 seat Canadian aircraft move their birthplace to COMAC’s facility and give them have a Chinese passport.

          The C1/3 fuselages are already made n China, ship the wings and engines to COMAC.

          The CS500 will more than likely have >150 seats, build them in Canada. The CS5 could also be to close in size to the native C919 and have a potential big market in the US.

          • And they predict big demand from China.

            Can see Boeing run into its own dumping issues if they don’t watch out.

          • The China option would become the most viable option if BBD gets shut out the US market.

            Amongs other contries, China would potentially have the most to gain in acquiring the whole CSeries program / technology / know how etc.

            Even with the Chinese onboard, BBD current footprint would still make sense (Mirabel FAL, Belfast wings). COMAC would eventually get a second FAL.
            The US supplier list might have to be altered, depending on US security concerns and/or cheaper Chinese alternatives.

            Imagine now how competitive their future widebodies would be with Belfast made composite wings.

            Anyhow, China would not get bullied by Boeing very long…

            On the other hand, if BBD maintains its US market access, then the CSeries business case should work out ok for BBD on its own.

  33. It seems that the story is being written in favor of Bombardier! Can anyone explain why Bombardier currently takes 12% on the Toronto Stock Exchange?

  34. Perhaps we should look at the future and forget the rose tinted spectacles of the past in Boeing’s eyes at least. I still do not see what they are trying to achieve over anything but the immediate short term. All they have done is create an environment that is far more hostile in terms of:

    1 foreign govts eg Canada, Britain, Europe
    2 alienate potential purchasers
    3 lose lucrative defence deals
    4 be seen to be the ‘bully’ by many wider parties
    5 potentially forced BBD into a suitor with greater resources be it Airbus or Comac
    6 called in all its federal govt chips when it may well need them in the future
    7 highlighted the quality of the Cseries
    Etc etc

    This game is highly likely to backfire on Boeing from so many angles. The only real win is if BBD goes pop and ceases to be and that will never happen, at least not in a clean and clinical manner.

    As the market leader Boeing has certain ingrained advantages but also certain ethical obligations. By ignoring those obligations and fighting in the sandpit with the little boys Boeing is demeaning itself and losing the inherent credibility of its position. Reputation is hard won and easily lost, in my view whatever the outcome Boeing loses over the medium term

    • “I still do not see what they are trying to achieve over anything but the immediate short term.”

      They want to make sure the C Series is a total success. 🙂

      That aircraft has received more accolades during the last six months than in the last six years combined. We have never talked about the C Series as much as in the past few months, and always to say how good it is. And all that publicity is free!

      For Bombardier this is the best marketing campaign ever: Now everyone on earth knows how great the C Series is, thanks to Boeing.

      For me it’s as if Boeing had given Bombardier a doctorate honoris causa for its achievements with the C Series.

  35. As mentioned earlier, it is just business. Boeing is a public company and is competing with every other company on the market for investors. If Bombardier creates a beachhead in the US, Boeing’s future share price will be impacted because of the risk of losing market share to the CS300 and
    potentially, if ever developed, a “CS500”. From a business perspective, Boeing would be negligent in not trying to impede Bombardier because the CSeries is a real, potential threat.

  36. Meanwhile still waiting on the US Commerce announcement, its 625pm eastern …

    Hopefully the US govt / DoC has not rotted so fast under Trump / Ross they forgot to file the paperwork and went home

  37. Don’t know if this has been covered here, so apologies if it has. I’m not all too familiar with the legal and business end of civil aviation and so I’ve been wondering if Delta could circumvent the tariffs by having a third company outside the US buy the aircraft and then lease them back to Delta.

  38. Lockheed didn’t have a commercial airliner business anymore, after the Electra debacle and Boeing’s 727 supplanting turboprops, until it decided to get back into the business with the L1011. The fine L1011 would have replaced many 707-320Cs but Lockheed was not good at selling airliners.

    McDonnell Douglas had a commercial airliner business without interruption, it built the DC-10 but was too chicken to invest more – it floated a twin version but did not proceed, instead building the minor derivative MD-11. (Granted, also DC-9 derivatives.) Meanwhile Boeing developed the MOM of the day – the 767, with twin ETOPs range and rules, replaced many airliners including of course 707s and DC-8s. And in my experience Boeing sales people were class compared to M-D’s. I say that Airbus was competition to M-D but the big competitor was Boeing.

Leave a Reply

Your email address will not be published.