‘What kind of vision is that?’ Industry analysts scorch Boeing and CEO Calhoun

By Bryan Corliss

Feb. 7, 2023, © Leeham News – Less than a week after Boeing CEO Dave Calhoun stood in the company’s Everett factory and vowed to “maintain this leadership culture forever,” a panel of top aerospace industry analysts blasted Boeing’s corporate culture and criticized Calhoun’s leadership, saying he lacks vision, industry knowledge – even charisma.

Aerospace analyst Kevin Michaels.

“No new aircraft until 2035,” said AeroDynamic Advisory Managing Director Kevin Michaels. “What kind of vision is that?”

Having Calhoun at the helm of Boeing at this juncture is “the worst-case scenario,” said Michaels’ partner at AeroDynamic, Richard Aboulafia. “(Calhoun) is somebody not only not from this industry, but someone who maintains a willful ignorance of it.” 

The challenges Boeing faces mending fences with all the groups it has disappointed or alienated in the past 20 years – customers, suppliers, regulators and workers – are immense and it may be more than one person can handle, said Bank of America Managing Director Ron Epstein, who also was on the panel. 

“It’s a hard, hard, hard job right now, to be the president of the Boeing Co.,” Epstein said. 

  • Panel rips lack of new product development
  • Without a new airplane, whole industry is challenged
  • Panel: Boeing struggles to retain engineering talent
  • Michaels: Suppliers in ‘crisis’

Panel rips lack of new product development

The panel, which met at the Boeing Future of Flight museum at Paine Field – just across the runway from the Everett factory and flightline – had met to discuss the results of Aboulafia’s most-recent study of aerospace industry competitiveness. 

The report – commissioned by, SPEEA and IAM 751, the two main unions for Puget Sound aerospace workers – was released just before the kick-off of the Pacific Northwest Aerospace Alliance’s annual conference.

The study found that, based on roughly 100 quantitative measures, Washington state continues to be the best U.S. state for aerospace companies to do business in. Michaels noted, however, that Texas and Alabama had made noticeable gains in the past two years.

But under questioning from Pulitzer Prize-winning journalist Dominic Gates from The Seattle Times, the conversation turned to the panel’s thoughts about Boeing’s future.

The panelists were critical of Calhoun’s investor-day announcement that Boeing would wait a decade for new technology before bringing a new aircraft to market.

“There’s clearly a market for a new airplane,” said Epstein.

Michaels agreed. Boeing has all the new technology today it needs to put out a new jet that’s 8% to 10% better than the competition, he said. Such a plane would “sell like hotcakes in this environment.”


But instead of pursuing what would be a very successful airplane program, Calhoun is holding back waiting for some sort of market-disrupting new technology that will cut fuel burn by some 20%, Aboulafia said. 

But that’s just not how aerospace works, he said. “Disruption doesn’t happen in this industry. It doesn’t happen. It never happens.”

Michaels said that historically, Boeing was the market leader because it listened closely to what customers wanted, delivered that to airlines and then provided outstanding customer support after the sale. 

Calhoun’s decision not to pursue a new aircraft ignores that history, he said .”I hope to hell that this is a feint and that they have a Machiavellian plan.”

Boeing already has fallen behind Airbus in the all-important single-aisle market, where Airbus has a 60/40 advantage, Epostein noted. “When you look out 10 years down the road, if nothing new happens, you’re in a market situation of 70/30 in the single aisle.”

Without new plane, whole industry challenged

The panelists also said Boeing’s decision to delay a new airplane program will have wide ramifications across the company and the entire industry.

For Boeing, a decision to wait until the mid 2030s on a new airplane program means that it will have gone 30 years without developing a new clean-sheet aircraft. By the time it gets around to doing it, no one at Boeing will remember how it’s done, several panelists said.

“If you wait 30 years between programs, it just doesn’t work,” Michaels said.

The same issue will affect suppliers, particularly among the engine manufacturers, he continued. “It affects your whole ecosystem.”

Gates noted that Spanish tooling company MTorres has sold its Everett headquarters and manufacturing plant, after Boeing’s announcement there would be no new airplanes.

“If you’re not developing a new product, you’re atrophying the design talent,” said panelist Martha Neubauer, a former Boeing engineer who is now an associate with AeroDynamic.

Boeing struggles to retain engineers

Boeing is “already struggling with losing that strong talent base,” Neubauer continued. While Boeing management seems to think that the company is a premier employer, more and more younger engineers are looking at it as a good first job to have on one’s resume, before they go on to careers at more-interesting companies, she said.


“There seems to be a disconnect between what could keep people at Boeing and what management thinks that is,” Neubauer said.

Large numbers of Boeing engineers have gone to Northrop Grumman, for example, to work on the B-21 program, the panelists said. Others are finding exciting work at Seattle-area companies like Blue Origin or Eviation. 

“There’s a whole slew of interesting companies doing interesting stuff,” Epstein said. “(Engineers) have options.”

For decades, CEOs at many companies have treated labor as an input cost to be controlled, Aboulafia noted. That has changed in a post-pandemic world where entire industries are being challenged by labor shortages. 

“These are different times,” Aboulafia said. “Talent needs to be cultivated. It needs to be attracted.”

Boeing leadership seems to have a  “misunderstanding of culture,” Epstein added. “A misunderstanding of how to motivate people. Culture matters a lot.” 

Panel: Suppliers in ‘crisis’

Boeing has “been at war with its suppliers for the past decade,” Michaels said. Boeing’s “Partnership for Success” initiative – which Michaels derisively called “partnership for poverty” – was self-defeating. 

Boeing may be strapped for cash now, but its Tier 1 suppliers are large enough and strong enough that they could become true risk-sharing partners in a new airplane program, he said. “Boeing needs a rapprochement with its suppliers.”

Further down the supply chain, things are dire, Michaels added. 

Tier 2 and Tier 3 suppliers have been devastated by a change in Boeing payment policy: Instead of paying on invoices in 30 days, Boeing now is holding onto the checks for 90 to 120 days – which drains the small companies of their working capital.

At the same time, inflation has driven their costs up, Federal Reserve moves to fight inflation have driven their borrowing costs up – and Boeing is coming to them with plans to increase production, which means major investments in new people and equipment.

But when they go to their banks for loans, they can’t get terms, Michaels said.

“There is a major crisis going on in aerostructures,” he said. “These folks are being bled dry. … They’re being asked to ramp up and they don’t have the capital to do it.” 

Aboulafia: ‘Culture matters’

A significant part of Boeing’s problems, said Epstein, comes down to the fact that the company’s leaders are primarily focused on quarter-to-quarter results that please Wall Street.

Michaels agreed: “Investors are Priority 1A, 1B and 1C.”

Stock analyst Ron Epstein

And when a CEO’s compensation is tied to how well that company keeps “24-year-old hedge fund managers” happy, “that might not be aligned with the long-term interests of the company,” Epstein said.

New product strategy will be less important for Boeing than the soft skills of its senior leadership, the panelists said.

Being CEO at Boeing “requires vision,” said Michaels. 

The CEO also needs to be a leader who can unite people to get behind that vision, Epstein said. “You need that charismatic person to lead the company.”

Boeing today has the talent and brand name to resume its historic place as an aviation industry leader, Aboulafia said. But, he added, “this all looks very perishable.” 

“The truth is that the next near or two, it’s absolutely crucial, and it all comes down to leadership,” Aboulafia said. “Culture matters. Culture and manufacturing execution.”

89 Comments on “‘What kind of vision is that?’ Industry analysts scorch Boeing and CEO Calhoun

  1. “Culture.”
    Only in Tolkien’s universe do the engineering dwarfs get off on gold.

    IN the real world those “endless greed dwarf”
    characters are populated by management, finance people.

    good engineers like money but they like an interesting job much more.

    • why not both?

      I work at a major defense contractor who constantly insists their salaries are competitive yadda yadda yadda. yet daily I see our young engineers (and many mid career engineers too) jumping ship less than 2 years out of college for 30+% raises (before inflation hit), meanwhile the company sticks to 3% raises as the baseline. meanwhile the people staying are largely late mid career to late career who are planning to retire in < 10 years.

      they are going for both more interesting, faster paced work and a lot of money.

      • Engineers are intellectual slaves. After graduation, most have large student loans, starting salary is nowhere near what their school was promising. And if you go to large corporations they are near high cost of living urban areas…..the salary quickly vanishes, and as you state, the raises barely keep up with inflation. I could keep going, but, your points are very valid, and often ignored.

        • I suppose that depends on what branch of engineering and which sub-specialization you go into.

          SW engineers (which, yes, are a different category from mech/civil/electrical) generally have actually good salaries and great career flexibility.

          for an electrical engineer who’s specialty is civil power systems, the opportunities are perhaps more limited (although my nephew got a sweet consulting gig straight out of college rather than a job at a power company)

  2. Hopefully the sounds are getting loud enough for Calhoun and the Board to finally hear and/or comprehend.

    • Doubtful. It’s what Calhoun and others have basically been fred right from the start of their careers. Calhoun felt deeply indebted to Jack Welch, whose management culture he inhaled during his time at GE.

      You can still see all the hallmark Welch moves in the way he manages Boeing:
      Treat employees as cost factors, not assets, hit your quarterly results/stock buyback/dividend goals no matter what, pressure suppliers, treat unions as your enemy, and so on. Just like Michaels said: “Investors are Priority 1A, 1B and 1C.”
      Kind of the same things that basically put MDD out of the commercial aircraft business.

      Considering Calhoun is now much closer to the end of his career (I mean retirement, not letting go at Boeing) than to the start, I find it very hard to imagine him suddenly changing tack. It’s very easy to predict what this leads to, though: Further declining market share in single aisle (their cash-cow). Airbus can keep piling pressure on them with further A321NEO improvements as well as an A220-500, and Boeing has no response besides discounting their planes and trying to uphold margins at least by putting even more pressure on suppliers and staff. And when 2030 rolls in, they find they don’t have the money to fund a new from-scratch development. Well, they do/did, but remember the all-important dividends and stock buybacks. What can you do?

      All of this is assuming that Calhoun and/or a successor of the same ilk stay at the helm.

      I really do hope Boeing finds its way and changes course before it’s too late. Right now, I’m not very hopefull, though. The writing’s been on the wall ever since the NEO, and even more so since the MAX accidents, and yet – decisions at Boeing still seem to be taken by exactly the same guiding principles as before… Separate management and engineering (place HQ for political lobbying, not integrity of the company), lobby rather than innovate (767 engine restrictions, 737 MAX crew alerting system), decide on FAL locations based on unionisation rather than quality delivered (787 FAL consolidation in Charleston), no new airplane for another decade or so. I mean… each one of those individuall could be called a necessary compromise or whatever. But looked at together (and the list is probably not complete), there is a definite pattern there.

      • Thanks for this comment, with which I fully agree. You’re not
        mentioning Boeing’s conntervailing secret weapon, though: more and better PR! (See their recent vows of “leadership” and “innovation”, yadda-yadda..)

  3. I love how people think because a plane has new technologies it will be successful.

    • What is needed are either new capabilities that make new routes viable for a carrier and/or an improvement in seat mile cost. Both usually need new tech.
      Another aspect that should not be forgotten – If you dont use latest tech you’re always at risk of beeing leapfrogged by airbus with a new model that does have all the latest tech.

      • I agree. But it must be at the right time, right price and right aircraft size. Unless you’re wasting your time and your money. And you’d be still be leapfrogged but not because of tech but because of price.

        Like I say. More and more expensive to build planes but airlines what cheaper and cheaper.

        It’s not only Boeing that shy away from launching clean sheets. Airbus hasn’t launched one in 16 years Boeing is 19 years. What’s the big difference?

        But I agree Boeing should launch a new plane. But it has to the right price for airlines. And nobody has the answer to that yet

    • 737 is and always is the (only) future that suits the C-suite’s vision (of FCF). 🤡

  4. “Hopefully the sounds are getting loud enough for Calhoun and the Board to finally hear and/or comprehend.”

    I bet none of them were there to hear what they were being told!

    • language gap.
      Those sounds will be perceived as incomprehensible babblings.

      Same as with the game of chicken the US is forcing on Russia ( and the rest of the world).

  5. At least if people knew why there wouldn’t be a new aircraft development till the 2030s, there wouldn’t be all this unnecessary talk.

    The a380 program is a great example, why not to rush into a new aircraft development without fully understanding the market.

    GE and RR also had doubts about Boeing’s
    estimated sales for the “797” and were not willing to commit to a new engine just yet.

    GE, RR and PW currently have a lot on their plate right now, and any new Engine entry ( except the GE9X) is expected at the earliest in the late 2020s, and that’s being optimistic anyways.

    Airbus is not expected to develop any new clean sheet design before 2030 either , but no one is saying anything about that.lol

    I know alot of people here despise Calhoun, but if he could bring Boeing BACK to ALMOST pre-2019 levels in terms of production /delivery rates and get the 777X flying with airlines, I think Boeing would be done for the decade.

    Develop a 737-10ER to compete against the a321LR/XLR, steadily increase 737 production rates to accommodate more sales and put pressure on airbus, bring the 777-9/ 777-8F into service, launch and develop the 787F, lastly stabilize 787 production rates, increase them and prepare for a 787X launch by maybe 2028/2029.

    Generate enough cash within this decade
    for EIS for the “787X” and 737 replacement in the next. That’s good enough

    • “Airbus is not expected to develop any new clean sheet design before 2030 either , but no one is saying anything about that.lol”

      Well I for one am bored to death of *BOTH* OEMs twiddling their thumbs for the last few years. I entered the workforce during the exciting days of the A380 and subsequent 747-8 development, then participated in development of the plastic planes when the 787 and A350 came along. Following that I spent some time looking at new narrowbody wing materials/technologies – but recently it’s all been about fiddling at the edges (new design methodology but no actual design) while we wait for one or other OEM to actually make a move.

      I would be quite happy for Boeing to blink first since we’d actually kick things off again!

      • Airbus is a lot like Boeing, it has a massive backlog that needs to be turned into dollars. Airbus stockholders read press releases too. That is where Airbus attention is right now.

        • At least Airbus is working on R&D of new technologies for the airline industry, Boeing is just playing monopoly, and loosing.

    • And you dream on. With Boeing discounting it’s products close to production cost there won’t be enough free cash flow to expand. They have just enough cash to go on with what they have at the moment.
      The 777X program??? Who knows? The plane is big and heavy. It might get a lot of headwind from Airbus.
      Boeing would have to increase the profit on it’s products sold, but that means raising the prices, and that brings them closer to Airbus’s pricing. Boeing is pricing their products to keep the final assembly lines going.
      Calhoun is facing the challenge to improve efficiency and quality in his production lines so he finally is able to progress with new products by the end of the decade.

    • ‘Airbus is not expected to develop any new clean sheet design before 2030 either , but no one is saying anything about that.lol’

      That is because Airbus is in the dominant position and does not have to do a damn thing, to keep beating Boeing.

      In every space and every competition, BA is losing – either internally or externally.

      The A220 space; BA has nothing there, but Airbus has to get costs under control. It will hurt them, for a little while longer, before it turns into a cash cow.

      The A320Neo vs 737 Max. BA is losing market share and it’s aircraft are not turning a profit. Cost them $20+ billion.

      787 vs A330Neo. The space where BA should be killing it. They’ve got a new aircraft against a re-tread, but have shot themselves in the foot. Billions in write offs, all the A330Neo has to do is break even and it’s a huge win for Airbus. Totally an internal, self inflicted wound.

      A350 vs 777X. Again, billions in write offs and the market has clearly preferred the A350.

      To answer your point fully; Airbus has seen the devastation that a grounding/crisis can do to their company and have pledged to fund a $10 billion rainy day chest, as protection…

      and wait to see what Boeing does.

    • The 737 is a 1960s airplane duded up to look like it belongs in the 21st century.
      The 757 would have been a far better choice.
      The engineers are leaving because Boeing lost its vision years ago and settled for less.
      Remember the “launch” of the 787?

    • “Airbus is not expected to develop any new clean sheet design before 2030 either , but no one is saying anything about that.lol”

      Well, they’re not in a position of having 40% market share, declining, in their most important market. Their single-aisle portfolio also has more room for improvements than the 737 MAX. Plus they also bought a whole programme for very little money that they can base an A320 replacement on.

      So they’re arguably in a much better position than Boeing with regard to actually *having* to design an all-new airplane anytime soon. Mind you, they’re also spending actual R&D money AND keeping their engineers busy on designing hydrogen-powered concepts, even while there is no *concrete* programme on the horizon just yet.

    • It was cancelled some time back, Mitsubishi just was not admitting it. Next goes the BBD jet division.

      • Huge mistake to try and do it alone.
        Their obvious partner was Bombardier – who they worked with already, making the wings for the Global large business jets ( the size of a small airliner). Bombardier need to replace their RJ as well.
        Mitisbishi and Bombardier tie in for both the CS series and the Spacejet would have made a competitive business for the 75-145 seat market with 2 planes

        Embraer only succeeded in the small jet market as they outsourced practically everything in the airframe , including having some assemblies made in Everett WA !
        This idea its mostly made in Brazil is false as they used existing design-build assemblies companies

        • they also made (as did Embraer with the E2) a terrible bet on the scope clause changing.

          • I doubt there was any real possibility of developing the successor of E175 with the same weight but the PG1700G engines.

            Yes Mitsubishi seemingly has done such a thing but from a clean sheet.We will never know for sure what they actually did. It’s a pity!

  6. You really wonder how every expert (especially all the commenters here) has long realized that Boeing’s top management is not doing its job, yet the very owners of the company blissfully ignore all the signs.

  7. “The Owners” are very happy with the way Calhoun is doing his job.

    Only one stakeholder matters at Boeing – shareholders. They have harvested $70 Billion in share repurchases since the merger.

    From their point of view, Calhoun’s “job” is to get free cash flowing so he restart the share repurchase program.

    This is what a harvest strategy looks like. It’s not good for workers, not good for suppliers, not good for customers who want to operate a product for 20 years, and not good for communities. It is designed to make one stakeholder happy. Other stakeholders do …. not …. matter.

    It was hard for me to accept this when a financial analyst explained it to me 20 years ago. I accept it now. This completely explains why the McDonnell Douglas experience comes up over and over, and why making that comparison has no effect on executives’ behavior. From their point of view, it worked at MDC and its working at Boeing.

    One thing bears pointing out. Ron Epstein and Richard Aboulafia are familiar with the financial world. I give them huge credit for having the character to hammer on their compatriots to restore a long-term vision at Boeing.

    • @Stan

      You are spot on with this analysis. Nothing will change at Boeing. Frankly it’s a darn shame.

      • Agreed.

        If anyone needs to know how Wallstreet works you just look at Boeing laying off 2000 people and then the stock spikes up.

        There is a joke to the affect you make the most money by firing the whole company.

        • Thats day traders, they are sitting in their own home office doing that.

          Boeings and other company shares are always ‘spiking’ for any or no reasons.
          just looked online and for one day Boeing shares had ’10 spikes’ alone
          The story about layoffs just refers to that days ‘spike’, so its meaning less

          Boeings shares over last 52 weeks were low of $113 (oct 2022) and high of $223

          • Duke:

            Day traders do not have that kind of clout. While its short term, Wallstreet wants one thing, money. They don’t care about an industry, its all the short term gain. Its like a Vampire that drains a victim then goes onto the next.

            That is why a balanced CEO is critical, they ignore the Wallstreet pressures and manage the business on a sustainable basis.

            Calhoun is the opposite of balanced and into the loot and pillage mode.

  8. The thing to understand here is that from Calhoun’s (and the board’s) perspective, Boeing is not an Aviation Manufacturing company. they don’t give one flying fig about building the next great airliner, fighter jet, missile or whatever.

    it is a Money Factory and its highest and only product is short term gains for their customer, the shareholder.

    Boeing could make donuts for all they care. they just want the money.

    stock price Uber Alles, just be sure to dump the stock before the pump runs out of air.

    • Same imbecilic thing I saw at General Motors. Fall from 51% market share in North America to 8% and blackmail everybody into a bailout that cost every American taxpayer $35,000. Kill the suppliers and unions. Fatten up the shareholders and destroy entire counties nation wide with dangerously defective junk vehicle lines and jack up the homelessness to barbaric levels. CALHOUN DO YOU UNDERSTAND THIS??

  9. It is not as if the 787 will ever break even.

    Airplane tech is mature. Boeing and Airbus make platforms. The stuff that changes (seats/wifi/internet/avionics) are not made by the OEMs.

  10. What’s all the Doom and Gloom for? They just announced they’re shipping more jobs to India?

    I worked at one of Boeing’s top suppliers and I said to the Manager: What do those guys do over there? He said they fix the engineering software that was developed in India…

    But not to worry, the jobs were probably an offset for the Tata plane order for the Maxes that were stinking up the lot…

    • I saw that Indian Model software. It not like they are bad, but converting specification into working software? Nope.

      So the guy on the job itself has to not only fix all the mistakes, in some cases he had structure under it he could not fix and could only patch.

      The same issue was at the branch level where the engineer threw out software that was wrong, the difference was the structure was good and between the field engineer and the office they could fix it quickly.

      In one case we ran into, the company was living between graphic build tool and the good old line code.

      In that case it was quicker to just dump parts of the program and write it in line code.

      I knew a bit of line code, the field guy was a whiz at it and it worked perfectly.

          • Essentially the point I’m trying to make. The MD-95 / B787 / MAX way of doing business is the wrong way for long term growth of the company and the product line. Let them make seats in low cost countries. We also need to be aware of the transfer of technology. Especially with you know who.

  11. Boeing has hada rubber stampBoard for years.
    A Board that has not asked the right questions nor provided
    they show up, have their meetings and go home with their huge checks

  12. Admin: you have a very annoying advert that hovers over the “Read More”Button.

    They are getting clicks they do not deserve. Cheaters.

  13. I don’t know whether this angers or saddens me. I am so ticked. Boeing was once THE company to work for in the industry. People enjoyed working for Boeing. Having lived in Seattle for 17 years I was able to follow the company’s ups & downs but this is sickening to hear. Boeing has completely sold out to its investors & has managed to piss off just about everyone. Enough said.

    • So true of many great US companies that have adopted the slash and burn, MBA, outsourced, share buy back, GE, the future is a year out, profits before people, please Wall Street – philosophy. Look at Southwest Airlines, the aforementioned GE, many others.,…

  14. Young employees look for perspective, opportunities, fun and influence. Stick with existing capitalist, glorious past & “strong leadership” culture & get overtaken. Things changed in the last 25 yrs.

    • Boeing has always lost engineers to its suppliers.

      That is why the suppliers are in better shape than Boeing.

      Flip is those weird start ups that you will be out of a job in a few years. When you are younger you don’t care and can recover a career.

  15. The tax structure in the US drives companies to operate like Boeing. Why have a federal tax incentive to pull out profits and leave companies empty husks? Think of McDonnell Douglas and even Kmart.

  16. As the saying goes…”this ain’t y’re pappa’s Boeing”.

    The company has changed the past 20 years, unfortunately not for the good.

    I’m not really pro-union however Boeing is certainly an exception to the rule. Trying to save a few dollars by moving to South Carolina has cost Boeing tens of billions of dollars. That easily could’ve been used for R&D, employee salary, benefits, etc.

    I’ve been stating this for a while, the BOD as well as management should be booted.

    Also, management should have a 5 year minimum vested period of options (which can’t be reissued if underwater), etc. That way management isn’t looking for short-term stock gains.

    • Jacobin777:

      I have to disagree, yes Charleston cost billions, but it would have just gone to share buy back and dividends not something useful.

      At least South Carolina got an Aircraft assembly operation and a bunch of jobs out of it.

      You just have to twist your face around and see the situation right.

      • Charleston, in my view, was purely about Union busting. Rank and file labour in Seattle was making too much money which was taking away from top managements’ bonuses. in the 1980s’ Anglo-American management practices were all about lowering operating costs, and that generally meant cutting labor costs. Remember General Motor’s CEO Smith as captured by Moore in his documentary, where GM was all about installing robots or moving manufacturing to Mexico so as to cut labor costs, not necessarily to build a better product.

        • Of course Charleston was all about Union busting. But if they had not spent the money in Charleston, where would it have gone?

          Granted it gutted Everett for its main jet line.

          • to the workers and engineers in washington state.

            and as a bonus Boeing would not have had to deal with all the SC quality problems.

  17. If customers, the airlines, even hinted they were interested in a plane with technologies currently available, Boeing would be working toward a plane before 2035.

    When asked if Ryanair wanted a hifalutin 737-replacement, and would bear the costs of a new plane to achieve what could be gained with current technology, that airline said, “Not just no, but hell, no.”

    United Airlines has 787’s ordered for delivery through 2032 and 737’s through 2028.

    While no doubt their contract with Boeing allows them to substitute newer planes, it seems unlikely UA would place such a massive order if either Boeing or Airbus was likely to bring a new technology plane online, with cost saving to justify the R&D, this decade.

    • UAL only placed their order after Calhoun’s ID presentation. UAL has been waiting the MOM for awhile. It can’t wait much longer as its aircraft are not lasting as long as they previously thought.

  18. The other issue constantly over looked by pretty much everyone is the shakeup in the domestic US market that’s coming regarding regional jets.

    With well over 1000 RJ’s in service that, at least until recently were providing over 2/3 of all departures, there is a huge hole that will have to be plugged somehow.

    Everyone is beating up on Boeing for not having “vision”.

    Perhaps Boeing has more vision that anyone realizes. A Chinese plane to fill the bottom of the market and get its foot into the US market isn’t something that’s the stuff of hallucinations. Think 1965 Toyota Corolla or 1995 Hyundai.

    No. Boeing is not the bold company that built the 747 based on a handshake with Juan Trippe. I would hope not. The world in which Boeing became the company that changed is dead, dead, dead and if Boeing continued to act like it did in that world, it would be dead too.

    • Goforride:

      I guess that goes for Airbus as well.

      That said no Chinese aircraft can be certified by FAA or EASA so that is a non starter.

      • Japan has got a plane to do that- but it hit the certification buffers. It may come back but Japan industry is so opaque about what is really happening.
        Embraer is still big in the 90 seats and under

        China will have even bigger hurdles , unless they sell back their new improved version of the DC-9 which is in production to the US ?
        Maybe a bit on the big side
        So reality says that China isnt going to develop a regional jet on the 75 seat
        ‘scope class’

  19. The one part that is being missed is that Boeing can open up another two or three MAX production lines in Everett.

    I am going to have to run some numbers but ball park, with one added line that is 70 MAX a month and two more starting to push 100.

    Somewhere in the numbers is how many you can build and how many are actually flying for market share.

    The MAX turns out to be a pretty good placeholder.

    Airbus is happy they don’t have to do a wing or a new aircraft.

    • They can open as many lines as they want but the supply chain can’t ramp up that fast. Production is currently limited by supplier capacity, not Boeing factory floor space.

    • What’s the point? How many backlog does BA have (after two years’ fire sale)??

      BTW, anyone notices this from 10k:
      -> “For the 737 MAX, there is uncertainty regarding timing of resumption of deliveries in China which is still subject to *final regulatory approvals*.

  20. I just died laughing reading this panel of frustrated AvGeek ready to put the CEO of Boeing on the stake.

    They just aren’t serious and don’t know aeronautics any better than you and I, and even D. Calhoun.

    I’m going to analyze what these frustrated AvGeek said, because believe me I was just hilarious reading these lines…

    • Early in my career I was working for a small company.
      We had a case of contention running with another company.

      We regularly LMOAed over the moronish enemy lawyer letters.

      … till we got sight of some stuff that our own lawyer had sent :-))

  21. The opinions of these experts are very relevant, but they are clearly not aimed at the “aviation world”, but rather the “North American world of Boeing”. They demonstrate that they are not really concerned with the necessary competition between aircraft manufacturers, but with the fact that Boeing has lost the monopoly it had a few years ago. So much so that I don’t see any analyst “complaining” about the lack of competition in cargo aviation, largely dominated by Boeing.
    Finally, the analyzes and suggestions of these professionals are aimed solely at defending North American aviation, which is naturally valid (especially the event taking place at Boeing’s house). But its cannot be considered analyzes on global aviation.

    • Yes. This article is about what Boeing should do for the long term benefit of Boeing and US aviation industry.
      It makes no attempt to analyze what Airbus or any other OEM should do.

      • ‘The panel, which met at the Boeing Future of Flight museum at Paine Field – just across the runway from the Everett factory and flightline ‘

        Well, it wouldn’t be very nice to meet in BA’s backyard and talk about the other guy, would it?

  22. I wonder if the panelists talked about BA’s plan of a fourth line for 737? What’re their views?? Thanks.

  23. I think some of the statements here are neglecting to take into account the recent story LeehamNews posted about RR. I won’t go as far to say that Boeing in two years will be in the catbird seat when it comes to the Wide-Bodies, but the 787 will do fine against the 330Neo. The 777X is more of a question mark long term, but down the road as the 777-300s get replaced, “even money” (Vegas Style) would give lots of orders to the new Boeing. Also, that IGW added to the 787-9-10 could account for hundreds of orders…

    It is easy to bash Boeing because they have made so many disastrous mistakes, but there are still a lot of dedicated engineers and skilled workers that are doing a good job in spite of their sub-standard leaders. That 777X wing could be very effective and only time will tell. And one more thing: It’s a Duopoly!

    • Sam – tell me something;

      What use is selling a product, that costs you millions more to produce, then you receive in revenue? The 787 may sell some 1800 units, but what good is it, if at the end of the day you lost money on the entire program?

      The 777X wrote off $6.5 billion a couple of years ago, without having delivered an airframe. Again a loss.

      All of those losses are now sitting in the liabilities section of the balance sheet, in the form of long term debt. $52 billion of it. ~$2.5 billion a year in interest payments.

      How many aircraft must Boeing sell, to make a margin that covers the interest payments, alone? IF (and this is a huge ‘if’, because they have shrinking margins, as evidenced by their financials) they made $10 million on every 737 sold – the first 250 would go to pay INTEREST EXPENSE.

      If they could get to 42 a month and make $10 million a plane – 6 months work on the 737 goes to interest.

      You gleefully say that it’s a duopoly. In that case, AB is hoping beyond all dreams, that BA rolls out more of aircraft that put’s them in the ‘catbird’ seat.

      • Boeing stock is about 200 a share today. Now your figures are probably real close to exact. But a number of mutual funds, ETFs, retirement funds hold this widely held company. Millions of employees provide parts to their products. Now you can fool some of the people all the time, all the people some of time, but not all the people all the time. Let’s hope Boeing somehow pulls this out. I’m guardedly optimistic, But Nixon did get a second term, well part of one …

        • “But Nixon did get a second term,”

          Just to go down in flames with a vengeance 🙂
          ( Hersh is at it again these days. Similar disruptive potential .. )

  24. Small biz supply chain is much worse than described in this article! Decades of pilfering for success and COVID have decimated small aero manufacturing businesses. Smash businesses carry the debt for Tier 1, Tier 2 and OEMS! Not sustainable!

    • From a 30,000 view on the commercial aircraft supply chain, based on the past downturn (4 years), lack of new aircraft program (no R&D) only the strongest with technology and financial backing will survive The typical third or fourth choices when going out to bid are no longer viable in the long term and will exit this industry and find other industries to sell other products. Smaller companies don’t have the financial resources or profit margins to wait over 1/2 year to get their cash back (start of production, delivery and waiting 120 days for payment)

  25. Calhoun is an accountant, and Roger Smith at GM was a business major, Bob Swan at Intel was a business major… see a pattern? Replace Calhoun with a an engineering visionary before it’s too late!!!

  26. “But instead of pursuing what would be a very successful airplane program, Calhoun is holding back waiting for some sort of market-disrupting new technology that will cut fuel burn by some 20%, Aboulafia said.”

    Depending on what metrics / starting point one chooses, RR seem pretty certain that UltraFan is going to be a pretty big cut in fuel burn. It’ll be interesting to see which wide body is first graced by it. That’s going to happen before either Airbus or Boeing have designed a new aircraft. Anyone prepared to bet on it being A350?

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