Where and who will be laid off in Boeing reset?

By Scott Hamilton

Oct. 14, 2024, © Leeham News: As Boeing prepares to lay off about 10% of its workforce of 170,000 employees, the key question remains unanswered:

Who and where will the layoffs come from?

Boeing didn’t say in its Friday announcement, other than in broad terms: “These reductions will include executives, managers, and employees,” CEO Kelly Ortberg said in a message to employees.

“Executives” in the Boeing organization include down to the Director level in management—not just the C or officer level. Union and non-union employees are at risk.

But there was no information about which divisions will be subject to layoffs, or how many in each.

Boeing Commercial Airplanes has the most employees of the three divisions of the company. But the “Enterprise” by far employs more than BCA or the other two units. Figure 1 has the breakdown.

Enterprise employees

The Enterprise includes the C Suite executives, corporate finance, and Human Resources, among other functions. Engineering across the company now falls under “Enterprise.” In the waning years of former CEO David Calhoun, 10,000 engineers were hired; these now are under Enterprise rather than under BCA, BDS, and BGS. Reassigning the engineers to the Enterprise was part of the moves intended to improve the safety culture at Boeing and consolidate responsibilities under one group rather than at the business units.

Overall, in 2023, Boeing hired 23,000 people, including those assigned to the final assembly lines in BCA and the Defense unit. Approximately 3% of the workforce resigned during the year. About 57,000 employees were union members at the end of 2023.

The headcount jumped dramatically in 2023 compared with 2022 when Boeing and the world were emerging from the two-year COVID-19 pandemic restrictions. In 2022, Boeing employed 156,000 people. Calhoun expected BCA production rates to make strides in returning to normal after the pandemic, the 21-month grounding of the 737 MAX, and a 20-month delivery suspension of the 787. Production rates of the 787 had also trickled to a mere 0.5/mo during the pandemic.

As things turned out, MAX and 787 production is at a fraction of plans and there is no clear path to returning to 2019 production levels for any BCA 7-Series airplane. The result is over-staffing.

Internally, Boeing executives were to provide more information today about executing the reset plan.

287 Comments on “Where and who will be laid off in Boeing reset?

  1. Might be a good idea, in any case, to lay off staff from the programs with the biggest bleeding ulcers. In that regard:

    “…but analysts were likely unaware of some large write-downs that Boeing announced Friday — a $2.6 billion charge related to delays of the 777X, $400 million for the 767, and $2 billion for defense and space programs including new Air Force One jets, a space capsule for NASA and a military refueling tanker.”

    https://www.ien.com/operations/news/22923139/boeing-to-lay-off-17000-employees

    Another $2.6B writeoff on the never-ending 777X saga…my oh my.

    Tangential question: can we expect commensurate layoffs at Spirit?

    In that regard:
    “AUSA 2024 — Bell Textron will produce fuselages for the Army’s Future Long-Range Assault Aircraft in house, having made the decision to take the work away from Spirit AeroSystems following the announcement of its proposed acquisition by Boeing, Bell and Spirit confirmed to Breaking Defense.”

    http://breakingdefense.com/2024/10/bell-to-manufacture-flraa-fuselage-after-dumping-spirit-aerosystems-ahead-of-boeing-acquisition/

    • I find it very interesting how silent the State of Washington is in these matters….

    • I believe that some corporations will be having a re-think (in general, not just the aerospace industry) about the value of farming out work that can be done in-house.

      You might save a few bucks, when it works well. But when it falls apart, it goes south really quickly.

      • Global outsourcing has never been a cost saver, merely a sale.
        Boeing, specifically, has sourced successfully to great success as part of a broader strategy. Partnering with Japanese and Korean industry is a good example.
        In general, vertical integration scales and is easier to wind down. Offloading “non-core competencies” is an assinine approach that looks good on a spreadsheet.

    • So I guess executives and managers are not employees ? Way to put yourselves above the rest .no wonder things are a mess

      • You must be new to the work force. All large companies refer to hourly workers and “employees”. Even some salaried leads and supervisors are still refers to as employees. Leadership is managers and above. Yes, they are all employed by the company but the nomenclature has been in place for the longest time. Don’t feel it’s meant to be little you but the fact is, leadership is far above you.

        • Just keep in mind that “Leadership” at Boeing does not mean they have leadership skills. That has been a huge part of the problem with executives at Boeing for the past 15 years. Did David Calhoun have leadership skills?

      • I feel, you are on the correct path. Since before covid, long before, the “top” heavy structure at Boeing has just increased. The board is trying to meet political agendas of “feel good” policies and forgetting goog old business practices. HR has taken over a massive amount of management that already was under mountains of meetings. Meetings about meetings. And then, catering to the ones who refuse to work and just burying them in corporate structure, wasting millions in payroll. Boeing is NOT a social service or experiment. It WAS a business. Dedicated to building quality products. Not a welfare office full of ridiculous policies that are great for communist/socialists, but have NO PLACE in a capitalist business.
        Manufacturing has suffered, creating an environment of pushing factory workers, already overloaded,to take on more. Quality suffers and upper management answers by creating more white collar jobs to try to understand why, what has NEVER worked, still doesn’t, when Boeing tried it.
        I, as a shareholder would demand the entire board to resign and start fresh with CAPITALISTS sitting in the chairs.
        Then I would go through employment records and remove all of the problem employees. Then, remove all the white collar employees and managers that have not performed, ever. Many perform lower, currently, after living through the whole period of poor decisions and trying to accomplish something different while using the same losing business plan with different leaders.

        • The Powers That Be save us from Capitalists.

          I gather We The People is long gone. Bringing back indentured servitude is such a great idea.

          • In what “capitalists” world, bankruptcy is not only disdained but also avoided at all costs?

  2. I’m wondering if the Boeing aircraft currently “pending” certification will ever be certified, per the recurring delays. 737-7, 737-10, 777-X: all many years behind schedule, and layoffs will not speed up their certification.

    Wonder what Ryanair and Southwest are thinking
    right about now.

    • @Vincent

      Southwest has its own problems. The least of which is they really dont need any more aircraft.

      If Boeing is backed into peeling back work, start with Max-7 and the 777-8. No Max10 means no viable “alternative” to the A321. And the 777-8 has almost no backlog.

      • The MAX-10 can also be dumped — for many customers, the MAX-9 would be a semi-adequate alternative.

        And the MAX-10 is never going to compete with the LR/XLR versions of the A321neo.
        Further: I wouldn’t at all be surprised if the telescoping landing gear on the MAX-10 is a dog’s dinner just waiting to reveal itself.

        BA should probably drop the 777-9 and 777-8F also…that thrust link gremlin sounds like the final noose.

        • Basically agreed. A bunch of Rube Goldberg stuff from an outfit that can’t even get basics (door blowout, FOD, nacelle heat) right.

        • They should have raised the landing gear when they went from classics to the NG…

          Wait until the stability issues with the 777X come out…it’s not 7 years delayed for no reasons

          • Oh, we’re on exactly the same page 👍

            I’ve long suspected that the 777X is a veritable fountain of screw-ups, and we’ve just barely scratched the surface with what has been revealed to date.

          • Not possible. The gear wells cannot be made larger to accommodate taller gear. The 737 was built to be low to the ground. It’s time for a whole new design.

          • There is a way around that.

            Not ideal but they do make it work mostly. It has an impact on how much rotation you can get and affects high and hot ops.

          • LNA: “The MAX 10 will have worse field performance (essentially the same as MAX 9, which is a bit of a ground hog)”

            The increased approach speed is one reason that the 737-900 and 737 MAX 9/MAX 10 is not a comparable replacement for the more capable 757-200 at smaller-to-medium-sized airports.

            In the southwest, airlines have to ground flights during times of extreme hot temperature. As our world gets hotter and hotter, this problem would only get worse.

            According to a researcher, if a plane requires 6,500 ft of runway at 20 degrees Celsius, it’s going to require 8,200 feet at 40 Celsius.

          • @Pedro:

            The 757 has higher thrust engines, ergo, cheap fuel and it was viable.

            Now, no.

            Airbus is a ground hog as well, its just a bit less of one as its got better rotation.

            You don’t get something for nothing. Lower thrust, more ground eaten up (runway) taking off.

            The A31XLR trades pax numbers for fuel.

          • @MTOW:
            737-MAX8 2500m
            A321NEO 1950m
            757-200 2100m

            XLR swaps infrastructure ( AUX vs integral tank mass ) for fuel
            added bonus : higher MTOW.

          • Trans

            Hahaha haha

            Having worse field performance than most widebodies like the MAX 9 makes it a hog.

            Still valid today 👇
            “I want my MOM”, say airlines buying A321neo, not 737 MAX 9/10X

            “Despite multiple, restated questions from journalists though, it seemed that Tinseth didn’t really have an answer about the order outperformance of the A321neo over the 737 MAX 9, or the fact that key customers like Norwegian aren’t interested in the proposed MAX 10.”

            ‘Given the just-proposed 737 MAX 10, and no appearance of the perennially discussed though not yet released next-generation small twinjet for the middle of the market, Airbus’ John Leahy’s jibe about Boeing “the Paper Airplane Company” might be hitting just a little close to home in Seattle at the moment.’
            https://runwaygirlnetwork.com/2016/07/want-mom-say-airlines-buying-a321neo-not-737-max-910x/

          • Additional quote:
            “Much of the advantage the A321neo holds over the 737 MAX 9 is in terms of thrust to weight ratio.”

          • thrust to weight :
            A321NEO : 15.4%
            737MAX9: 14.8%
            i.e. the delta is not really significant.
            and for the fun of it:
            757-200: 16.8%

        • Thrust link, uncommanded pitch downs..

          Don’t forget the stuck rudders on the 37

        • “: I wouldn’t at all be surprised if the telescoping landing gear on the MAX-10 is a dog’s dinner just waiting to reveal itself.”

          Have you wondered why the A321 XLR long range version with new tankage isnt certified yet .. yes the announcement was a sham as it only covered the equivalent to the LR version. Those getting deliveries must be wondering when they get what they ordered – a long range A321 with an usable tank from day 1

          Same happened with the A350-1000ULR . The certifiers told Airbus to go back and and do it again
          ‘On February 22, 2024, Qantas explained that delivery of its fleet of new Airbus A350-1000s would be delayed by six months because the regulator had requested that the aircraft’s center tank be redesigned. “

          • Oh My Dearie Me, a six month delay from Airbus!

            ..while the Other Dudes can’t even provide a timeframe
            for their obsolete-before-delivery stuff..

            We’ll see how it goes, Duke. BTW, How’s that retraction coming along of the ABC / Boing 737 article that you claimed was imminent- a couple of years ago?

            just checking..

            😉

          • If it weren’t for Boeing’s current problems, Airbus’ difficulties would be more obvious. Things aren’t going so great for them.

          • Duke is right to lay that out as its challenging for even the most accomplished airframe (Airbus)

            This is another example with no exploitation but its a significant delay

            https://www.flightglobal.com/airlines/deeply-disappointed-malaysia-airlines-hit-again-by-a330neo-delays/160305.article

            Boeing is far better covered and no excuses, they have messed up seriously.

            Its actually fascinating they got as far as they have.

            And then you have a supplier mess up on an obscure option (737 Ruder ops for Cat IIIB) and its, ok, Boeing has its problems but putting a bearing in wrong? Wow. That is like mechanics 010 level.

          • Oh dear headless chicken running around screaming the sky is falling!!

            Ahem European authorities approved Airbus’s higher-weight XLR on October 11. Poorly informed is bad, publicly exposing it is even worse.

            Remind me which “bloated behemoth” just announced a 10% cut in work force??

          • Trans

            Look it seems like AB is able to identify aircraft issue(s) before delivery, unlike you know who (AS 1282).

          • “Have you wondered why the A321 XLR long range version with new tankage isnt certified yet .. yes the announcement was a sham as it only covered the equivalent to the LR version.”

            the higher weight cert hangs afaics on (uprated) engine certs.

            Existing XLR certification includes all the relevant changes to the airframe: integral rear tank, changed high lift, changed crash/fire protection ( undecided if that actually makes sense or is nothing more than a greek gift from Boeing.)

          • Oh dear!!

            Is this “fake news”?? 🤣
            FG: “The European Union Aviation Safety Agency has formally amended the aircraft’s type certificate to include the 101t maximum take-off weight version, listing it as variant 100.”
            Can’t breath… laughing so hard.

          • Why not wait till the full weight version was certified ?
            July was PR announcement
            Now its OCT 12 theres ‘supplementary news’

            Ive never heard of a new variant being rushed out incomplete like this before . Still very very late from the launch many years back- back in 2019 it was supposed to be in service by 2023

            as for the engine type only the CFM approved and Pratt yet to come
            At the time, Gaël Méheust, the president and chief executive officer (CEO) of CFM International, remarked that the engine was always designed with a 35,000 pound-force thrust (15,568 daN) rating, enabling the engine to be used for longer range, higher maximum takeoff weight (MTOW) aircraft.”
            So no higher thrust needed

          • @Duke:

            A higher thrust is needed, just not a change of design to get it.

            The other engines will be thrust limited.

          • The A321XLR 101t is now certified, unlike the “very very late from the launch many years back” 737 MAX 7, MAX 10 and 777-9.
            Oh dear, if you live in a glass house … 🙄

          • FYI
            May 15, 2013
            Boeing, Southwest Airlines Announce Launch of 737 MAX 7

            Why anyone would bring up an aircraft that’s “very very late from the launch many years back” is a mystery.

      • LUV needs the right aircraft for the routes they have.

        Flying a Max 8 or a 737-800 on a route that call for a Max 7 (less than 150 pax) is a problem.

        They had an off-ramp in 2019 and could’ve ordered some A220’s but now they’re stuck.

          • It should be noted that the MAX7 is not a lighter version of the MAX line.

            Its advantages are not that great. Boeing elected to shrink the -8, not optimize the -7 size (its cheaper but you wind up with a heavier aircraft)

            SW has a couple of problems that supersede the aircraft. One is its employee costs are higher than anyo0ne else now. Years of incremental labor costs and not going bankrupt.

            There are models that maximize (pun taken not intended) revenue. Yes we all hate them but you can make revenue off them.

            SW has not done that. What worked before is not working now.

            I agree with Frank P. The A220 would have been one right choice though I continue to think the E2-195 would have done fine on those point to point lower density routes. Both are designed for the size aircraft not a bigger one.

            You loose commonality though how much SW gains these days from that?

        • Even SW noted that they are basically getting the first 100 MAX 7s for free.

          • You just gave the perfect reason why Boeing could dump the MAX7 if it needs to cut programs.

        • Unfortunately or fortunately the delay of the MAX 7 is not the biggest worry of WN CEO, he’s fighting for his job.

      • There is no peeling back the 777-8f because we haven’t even started on it other than design work.

    • With Chinese financing they’ll sell a boatload of them, whatever they’re called this week.

      • Amend that, with Chinese arm bending they will sell them, to Chinese Airlines or Chinese controlled entities.

        As far as a full spectrum operation, (COMAC) hmmm.

        We have a regional jet that uses a totally discounted engine mounting system. Check

        We have a A320/MAXX-8 wannabee. Check

        I guess a regional aircraft is better than a wide body any day of the week.

        Or we can just put it to hype.

      • Triggered
        (Wink wink 😉 )

        ——————

        “I guess a regional aircraft is better than a wide body any day of the week.

        Or we can just put it to hype.”

        US of A is still the largest market for RJ I guess. 😉

        For the right routes, RJ not only beats WB, it also beats NB!

  3. Whoa!!

    ‘Over the weekend, I reached out to Emirates’ Tim Clark for comment on the 777X. His remarks went beyond frustration, raising concerns about Boeing’s financial health & a “looming” risk of bankruptcy, an amazing statement from its biggest widebody customer.’
    https://x.com/jonostrower/status/1845865603233444243

    Emirates’ Clark raises ‘looming’ specter of Boeing bankruptcy protection
    https://t.co/5thjb4GH7N

    Emirates president Sir Tim Clark, Boeing’s largest twin-aisle jet customer, became the first industry leader to openly suggest the aerospace industrial institution’s current financial state has put it on a trajectory to bankruptcy protection, unless it rapidly shores up its equity position.

    In an email to The Air Current following the announced Oct. 11 delay to the certification of Boeing’s 777-9 flagship jetliner, Clark said, “Unless the company is able to raise funds through a Rights Issue, I see an imminent investment downgrade with Chapter 11 looming on the horizon.”

    I recall this:
    “[…] The townsfolk uncomfortably go along with the pretense, not wanting to appear inept or stupid, until a child blurts out that the emperor is wearing nothing at all. The people then realize that everyone has been fooled. Although startled, the emperor continues the procession, walking more proudly than ever.”

    • Of course.
      BA is a runaway train on a downhill slope…time to admit to the inevitable.

      • Evidence to the contrary is welcome here, but so far I’m not seeing it.

        • Well, a whole group of commenters here doesn’t understand what Ch. 11 actually entails, so they’ll probably chime in with the usual, irrelevant “TBTF” and/or “vital industry” angles.

          Intriguing: not so long ago, anyone suggesting here on LNA that BA could land in Ch. 11 would have been scoffed at. Nowadays, it’s the topic du jour.

    • Aboulafia was right behind them!
      “”I’m not sure I see the bigger plan here,” Richard Aboulafia, a consultant with AeroDynamic, told AFP.

      “Getting rid of a lot of talent when there’s a serious aerospace talent shortage doesn’t seem like the smartest move,” he added.”

  4. Boeing’s equity section of its balance sheet went negative sometime between 2007 and 2012. When exactly depends on how 787 deferred development costs should have been written off. A negative equity total on the balance sheet is the definition of bankrupt. It is super common for people to use the word bankrupt when they mean insolvent.

    Insolvent is defined as near term liabilities exceeding near term assets, or an inability to pay bills that are due.

    “Bankruptcy protection” just means that a court takes over and attempts to salvage something for those who have long term liability positions (i.e. are owed money for things like purchase deposits and mortgages. Generally, payroll and taxes are first in line.

    Ortberg almost certainly does not have the permission of his employers to do that voluntarily, since it would wipe out their positions, that is unless Wall Street would continue to pretend that Boeing stock is worth something even after it has been disassociated from the company. It’s been disassociated from reality for a very very long time. There is little difference between Boeing stock at the moment and the British South Sea Company 1853 or the Dutch tulip bulb bubble of 1637.

    As bad as all of that is, the non-accounting assets of Boeing are in worse shape than the accounting liabilities and equities are.

    • @Retired

      Taking you one step further, companies file for bankruptcy when then run out of cash, not when they are not profitable.

      Boeing will continue to stay out of bankruptcy court so long as people are dumb enough to give them money. Boeing kind of got away with one when they borrowed an additional $10B in April. They will not get that again soon. What stuns me is that the stock is still $150/share.

      This is a company that has long sinced stopped running operations out of normal working capital. It is one crisis of confidence away from a Chapter 11 filing where the shareholders will find out the stock price is really not worth $150.

      • In general, statistically speaking, companies run out of 💰 when they stop being profitable. So the two statements tend to correlate strongly.

      • Exactly. And sorry to another commenter, but there is no such thing as technical bankruptcy, or at least there isn’t that has any more validity than the business of stock technical analysis. I recommend Malkiel’s famous book, “A Random Walk Down Wall Street.” As an aside, random anything is the spookiest thing I have ever encountered in my life. It is everywhere and in in everything. Take anything that looks perfectly uniform and change the perspective by three orders of magnitude (usually by going to a smaller scale, but one can go cosmic as well) and randomness suddenly appears and uniformity disappears.

        On the notion that Boeing can be saved by breaking it up, sorry – that won’t work. It is really important for everyone who cares to understand that Boeing was not and never was a commercial airplane company that also made some defense products. Rather, it was a defense company that also made commercial airplanes.

        Why is this reversed perspective so important? That’s because the very best engineering, math, and applied science talent required to make it all work was paid for by defense development programs. The talent that made these possible backed up commercial, and the concepts they developed went directly into commercial airplanes.

        The 307 came from the 299 (aka B-17). The 314 came from the 294 (aka XB-15). The 377 came from the 345 (aka B-20/B50). The 707 was a joint program from the start, but the key requirement was a refueling tanker for the B-52. The 737 was a NASA funded IR&D project to see if a plane to serve small market, including ones without pave runways, could be developed from existing components and use existing production tooling for the 707 and 727. The 747 started out as Boeing’s failed proposal for a heavy lift freighter (Lockheed won with the C-5). Boeing’s work on the B-2 and F-22 created many of the technologies that first shaved a ton of weight off the 777 and made the structural concept of the 787 possible.

        Without a qualified cutting edge defense projects division, Boeing will never produce another successful commercial airplane, let alone a profitable one.

        A profitable program will have two key elements. One, is that the product at its target price point will be something the carriers find to be a “must have.” Second, the production system will have to flow smoothly with high quality and finished work being done at each station in a well balanced manner, with no rework requirements post assembly.

        None of that can be accomplished without a major infusion of capital way beyond what has been discussed so far. To save the company, this death by a thousand cuts has to stop, and Ortberg does not yet have the resources to even begin to do that.

        • I will agree with you to a point on this.

          However, never forget how much design was NASA engineers and the research subs that designed and tested much of this technology…and then gave it over to Boeing.

        • Point being RTF – is that negative equity does not mean bankrupt or insolvent.

          Negative equity is as posted from the source:

          ‘When either result is negative, the company has negative shareholders’ equity. That means that the shareholders would receive nothing if the company declared bankruptcy and was forced to liquidate its assets.’

          BA has not declared bankruptcy. It is still (barely) paying its bills.

          Another company who has negative equity?

          https://seekingalpha.com/article/4722150-fast-food-mainstay-mcdonalds-faces-debt-problem

          ‘McDonald’s has significant debt and negative shareholder equity’

          Not bankrupt.

          • Look, I did not flunk my accounting classes, basic or advanced. I also took Becker and got both my certificate and CPA license. I worked as a staff accountant for both a large industrial supplies distributor and for what can only be called a flakey tax shelter firm (now that was a financial education in itself). I also worked for two years as a revenue auditor for the State of Washington. and I did contract labor doing Medicare provider audits for a while before going into Boeing and getting paid to pursue my computing and networking hobby. But it didn’t stop there. For six months during my five year stint in Boeing’s Advanced Research and Technology Organization I was lent into Boeing Corporate Finance to do some internal audit work. Also, during my entire 31 years at Boeing I did keep up my CPE requirements. My boss at one point even paid for me to take a weeklong course in Activity Based Costing because it applied to what we were trying to do for the production efforts in Boeing commercial (aka BCA). That’s a reasonably well rounded financial accounting resume.

            An accountant’s definition of bankrupt is a zero or net negative balance in the equity section of the balance sheet. It’s been that way since Pacioli wrote the ninth chapter of Summa Arithmetica published in 1494. If you want to make something else up for the use of these words, so be it. It is popular for non-accountants to use the word bankrupt for the concept insolvent, but these are two very distinctly different things. And frankly, the investment community’s inability to keep these terms straight is a contributing factor to the nonsensical pricing of Boeing stock that has been going on for the past decade. Words matter, and if you get them wrong in this case a kind of self-delusion sets in. If the Street had been properly punishing Boeing corporate leadership behavior and performance for the past decade, this mess would not be nearly as awful as it currently is. But as Malkiel pointed out in his book, technical stock analysis tends to get everything wrong. Words matter.

            IN my very strongly held opinion, the ONLY way to save The Boeing Company is to 1.) recharter it with a new set of governing law, 2.) require professional licensing of its leadership with an ethics component, and 3.) task it to do something (preferably two somethings) that push the technical limits what what we now think is possible. If we want different results than what we have been getting, we must take a different approach. Oddly, that will look an awful lot like the way Bill Boeing ran things in the 1920s. If you have seen the film “The Red Violin,” (https://en.wikipedia.org/wiki/The_Red_Violin) that does a pretty good job of explaining Bill Boeing’s attitude toward work and quality. That’s the attitude that it will take to save the company, IMHO.

            Oh, and if it matters, I’m also significantly over qualified for membership in MENSA, despite my admittedly horrible typing skills. My brain just can’t stay back where my fingers are on the keyboard.

          • @RTF:

            I read with interest your summation of the military influence if not outright birth of BCA.

            Of cvourse our Europeai correspondint will screwm that is a subsidy. What they refuse to admit is that Beong prodeuced product and product that worked. B-47 and B-52 realy being the lead into the Jet age and the 707 was very well done.

            So, while it let Boeing pioneered the concepts of pylons and build, it was not a hand out, they earned it and then smartly applied it. The 727 was an odd divergence but it was a one off (very successful one off)

            I had given less thought to the composites aspect, but Boeing stepped in on the B-1 as well when NG was in extremis and behind the scenes Boeing did a lot to save that program (we might have been better off it failed, its an insanely costly bird).

            Boeing is using digital design on the T-7A so I guess you could say its a possible application if they ever do a commercial aircraft again.

            I do think you are dismissing the need for Boeing to divest aspects. Some of it will never return (launch and any NACA manned pie in the sky) and its worth considering if not doing getting rid of Satellites as well.

            I see those as never getting a return and getting nothing that feeds back into BCA.

            Divest those parts that don’t do anything for Boeing or are a loss and do nothing for Boeing. Keep the F-15/Hornet/V-22/Chinook and Apache though I question Attack Helicopter use going forward as they can’t survive in contested air space (gets off track into if we would have air superiority in the future) but ground defenses will knock any VTOL out of the sky if you have defense lines.

            I don’t think Boeing is as bad as GE was in its odd broken up non related areas, but I think they badly need to remove what is not a growth sector in the future.

        • Respectfully,

          I think that you are referring to accounting insolvency.

          https://www.nasdaq.com/glossary/a/accounting-insolvency

          Accounting insolvency
          Total liabilities exceed total assets. A firm with a negative net worth is insolvent on the books.

          But as I pointed out, McD’s has negative equity, along with a few other big companies that are listed.

          —————————————–

          ‘My boss at one point even paid for me to take a weeklong course in Activity Based Costing because it applied to what we were trying to do for the production efforts in Boeing commercial (aka BCA). ‘

          Memories.

          Cost accounting was a semester long course, when I did my degree. Wasn’t hated as much as Consolidations, but close (from what I remember, back in the day). I also really hated spending a whole Saturday, for weeks on end, to go to Becker. That and the $2500 cost, at the time.

          We had 3 accounting designations here (CA, CMA, CGA – only one today) and cost accounting was part of the managerial accounting track, which I was on. Used mainly for internal reporting needs (i.e. How fixed costs were allocated to various units so managers, who had bonuses linked to performance, argued back and forth on how expenses should be split).

          “Using ABC you only get allocated 10% of fixed costs, but your unit occupies 50% of the floor space? Why am I paying utilities for your division?”

          “But you have more employees, using more HR and Payroll resources. I’m not paying for that!”

          And on and on.

          Sitting all day long in a nice conservative dark brown or blue suit, doing audit work for a big accounting firm (How many hours did you bill this week? Up or out!) wasn’t my cup of tea, either.

          Your historical perspective on accounting is quite impressive.

          ————————————–

          ‘If the Street had been properly punishing Boeing corporate leadership behavior and performance for the past decade, this mess would not be nearly as awful as it currently is. ‘

          I laughed at this. If 2008 was any indicator, the vultures don’t care about doing things properly. This is why Ch 11 to get out from under contracts is probably off the books. There’s no way shareholders want to walk away with zero and how many bought in back when BA was pushed up over $400 by the buybacks?

          If you’re looking for common sense and doing the right thing, in the Market – you’ve come to the wrong place. Just have a gander at DJT stock to see what that’s all about.

          ———————————————

          Saving Boeing.

          There is another way, which is much more palatable, given the circumstances;

          Sell all the buyback stock, zero the debt. Issue more shares if need be. It’ll hammer shareholders, sure – but it is better than losing it all.

          But any scenario only works if the company is taken away from the financially driven crowd and given back to the engineering folks. The culture is so broken, any fix is only temporary, as long as people who are driven by financial metrics, are still around running things.

          New charter. Ethics component. I think you’re talking about changing the way the market works – which is admirable. But I don’t think that’s going to happen.

          ——————————–

          Mensa, huh?

          You have one of the bumper stickers they give out to put on the back of your car? One of my neighbor’s has one and every time I see it, I get a chuckle. That and a buck (plus taxes) get’s him a double double.

          Poor guy has trouble putting up his Tempo (temporary winter car shelter you install in the driveway) every fall, so I go give him a hand. He’s not very handy.

          Does it matter? Probably not. There’s a hunt going on for intellectuals, right now – where the rule of law, logic, reasoning and the scientific method simply don’t matter.

          Cynical, I know. I find you don’t get disappointed as much.

          • No, and I probably shouldn’t have mentioned it. That’s the first I’ve said anything anywhere about it in many decades, but this whole thing is really ticking me off.

            I read a lot of history, and its amazing how many times one writer’s mistake, sometimes centuries ago, will get repeated, put in textbooks, and taught as gospel truth when it was wrong.

            I don’t give a rip what the NASDAQ site says, that’s somebody repeating face saving nonsense. Insolvency is when near term assets are insufficient to meet near term obligations. Bankruptcy is when total assets are insufficient to balance the liabilities, so the equity section is negative. There is room for a math symbol dispute there (is it less than, or less than or equal to zero?).

            The reason it matters is because if people had been talking about Boeing as being bankrupt back in 2012, corrective action could have been taken before the non-accounting capital became as depleted has it has been. Now you have a cadre of engineers who can’t tighten things up sufficiently during the Critical Design Review, to ensure that the product as designed will perform as intended, on the promised delivery date, and that the company will make a buck building it.

            On top of that, you have cadre of manufacturing managers who don’t know how to orchestrate product assembly profitably. They are even worse at their jobs than the engineers are at theirs. They run the assembly lines passing unfinished work from station to station, and then after product is out of the factory it goes into a queue to be partially taken apart and assembled correctly per the flawed design. Pathetic doesn’t begin to describe the mess. The cash burn on rework is stratospheric. And you have program managers and executives rambling on about their production rates when not a single assembly line as a finished product rate at all.

            Saving some cash or raising a few billion to throw at sustaining the current mess is totally ignoring what needs to be done. But hey, let’s argue about misuse of accounting terminology. That fits perfectly well with pretending that the assembly lines have a finished product assembly rate. Why don’t we make some arguments in favor of booking goodwill while we are at it. To heck with this nonsense. I used to think this forum was a useful discussion about saving the company, but that appears to not be the case. I’m done here. Send me a note by regular email if want to do something useful.

          • @Frank P:

            You are welcome for the idea on use of the stock! I hope you do not get struck by a lightening bolt. Duck and Cover as we used to say.

            Been saying that all along, laugh of the day.

            I think Boeing should go Chapter 11 and that gives them powers to reorganize without ANY regards to Wall Street.
            Boeing is pushing if not over 100 billion in debt.

            Let Wall Street scream and holler. They are our worst enemy on the economy. Maybe a necessary evil but they kill things as its all money and no future.

          • @Trans

            I guess you missed the news today on the mixed shelf registration.

            Sorry about your Ch 11 dreams.

          • @Frank P:

            I did miss it!

            I kind of have a simple outlook. You keep loosing money and borrow more money and pretty soon you are Chapter 11.

    • Negative Shareholders Equity: What Does It Mean?

      Negative shareholders’ equity indicates that a company’s debts exceed its assets. It is seen as a sign of financial distress.

      Shareholders’ equity is calculated by taking a company’s total assets and subtracting its total liabilities. Both assets and liabilities are itemized on the balance sheets of public companies.

      When either result is negative, the company has negative shareholders’ equity. That means that the shareholders would receive nothing if the company declared bankruptcy and was forced to liquidate its assets.

      What is Technical Bankruptcy?

      Technical bankruptcy refers to a situation where an individual or entity (such as a corporation) is financially insolvent – has defaulted on debt payments – but neither they nor their creditor(s) has yet moved to file formal bankruptcy. In other words, they are effectively bankrupt, from a practical point of view, but not legally bankrupt.

      Technical bankruptcy may be eventually followed by either formal, legal bankruptcy proceedings, or financial or business reorganization or restructuring.

      https://corporatefinanceinstitute.com/resources/commercial-lending/technical-bankruptcy/

      https://www.investopedia.com/ask/answers/08/negative-shareholder-equity

  5. I wonder if the forthcoming 10% reduction in staff will include Board members as part of the “Executives” contribution? Is that a pig I see flying by?

    • Ortberg should cut right below him and fire everyone down the ladder until he saved Boeing 10 % in salaries. That measure would release Boeing of nearly all the people responsible for Boeing’s current state.

      • Right. Indiscriminate firing gets you nothing, good who keep their heads down get axed with the bad and the mix is still bad.

        Truly the simplistic statement of all time, They Should.

        How about what is reality and what can be done, not some, They Should. We live in the real world not a They Should.

      • It goes further with the interview with Sir Tim…
        expressed severe disappointment with mismanagement of the years, and expects BA to need emergency funding to avoid BK.

        • Then again….if Boeing goes Chapter 11 reorganization…taking it from GM 2009 playbook

          New Boeing will need $xx billion in debtor-in-possession financing to complete the process

          Boeing will be removed from the Dow Jones Industrial Average

          New Boeing then can the purchase of continuing operations, assets and trademarks of Boeing as a part of the ‘pre-packaged’ Chapter 11 reorganization

          Then U.S. Treasury can advanced a secured loan of US xxx million to New Boeing

          New Boeing with the backing of the United States Treasury could be formed to acquire profitable assets, under section 363 of the Bankruptcy Code, with the new Boeing planning to issue an initial public offering (IPO) of stock in 202x. The remaining pre-petition creditors claims are paid from the former corporation’s assets

          • Alternatively:
            – Full bankruptcy, with full wipeout of shareholders and bondholders.
            – Sell the shells of BCA and BDS to interested US parties for symbolic amount of 1$ apiece. If necessary, Uncle Sam uses sweeteners to encourage interest.
            – BGS is healthy and lucrative, and can be continued as a going concern.

            A single failure to repay the next due bond will be enough to act as a trigger.

          • Abalone

            And/or don’t take the tanker, AF1 and Starliner programs and negotiate new contracts as Cost Plus going forward

            As a side note, will Boeing Chapter 11 drive Spirit Aero into bankruptcy?

          • @ David P

            In reply to your second point: I suspect that Spirit Aero will be entering Ch. 11 a lot sooner than we might want to think. In such a scenario, what happens to the divisions doing work for AB?

          • Abalone

            Spirit Aero Chapter 11…in the reorganization Spirit can reject the Airbus contracts, then the price of acquiring Airbus production assets will go up (e.g. Belfast, Kinston) compared to just taking over the contracts as at very low price (e.g. $1)

          • @DP

            Is it true that the contractor is a UK company, not U.S.?

            Most likely the only interested buyer is AB, or one approved by AB. It’s not a free market, ultimately there’s only one paying customer for the products.

            If BA wants to pull such a trick, beware of the (unintended) consequences.

            P.S. If it’s that easy, every contractor including GKN or Spirit AeroSystems would have done so.

          • the assets that Spirit Aero that Airbus has an interest in were, in the most, part, purchased at fire sale prices from Bombardier.

            Remember that Bombardier basically almost gave the A220 to BA? BA didnt want it.

            AB did have the option to buy the wing plant for the 220, but did not.
            Spirit bought it, and now basically has to give it to Airbus.

            Next up, the failed BA purchase of certain Embraer assets (with engineers!) Let that debacle ruminate!

          • Nah, a bankruptcy of a co. like BA could bring down the house of cards, not on the eve of an election. After the bankruptcy of Lehman Brothers, the government & the fed won’t allow another one without a massive bailout. The stock was still trading near $150.

          • Regrettably, ‘New Boeing’ will still be stuck with IAM and SPEEA, demanding a military-style pension for a job that involves zero gunfire….

          • I love it when Sir Tim speaks.

            He is such a dweeb.

            He broke up the common engine Emirate had on all the A380s for a pure BS spin on the Trent 9 gaining a miraculous 7% SFC.

            Parting the Red Sea was pure childs play compared to that!

            Its not that he is always wrong, some of the worst workers I knew had an outstanding take on their fellow workers.

            They just never applied it to themsleves.

            I wonder when the 777X cancellations start?

          • When will BCA dole out compensation to Emirates so that TC can stop talking? What does he want? A pound of flesh, or a pound of blood? Or both?

          • Who says they are not?

            Free parts and service on their current 777s.

            FedEx dumped the A380 tehcnialy before they could but they got all sorts of things from Airbus as they had (and still have) A300/310s.

            UPS waited until the A380F was declared off the table (or the two years) and then dumped it. Not sure why they did not want free parts and service.

            What else does Boeing sell the Gulf States they can trade out and off? (defense stuff)

  6. Referring to a recent discussion here in the comments section with LNA contributor Bryan Corliss — concerning gig work for the lowest-paid machinists — one could argue that this (large) group of employees have the least “attachment” to BA, since they can pick up a better-paying job somewhere else with relative ease.

    Would that not be a logical group in which to start layoffs?

    Just goes to show the extent to which BA sold its soul to the devil when it let so many experienced employees go and replaced them by $21-per-hour newbies.

    • @Abalone

      Usually they start layoffs according to seniority wrt unions. So yes they will likely start with the lowest paid workers first.

      Congratulations now your average touch labor cost increased. There is a reason that Boeing offers buyouts to its highest paid workers.

      • Until they realize that all of the experienced people did early outs, and they were left with few experienced

        • Boeing doing this for years is why so much of the company is pushing retirement age…

        • You guys don’t get that those packages are focused on the experienced workers.

          Ahh Earth to commentators, those experience workers cost you the most money.

          Now, what the Calhoun types don’t get or want to admit, its those experienced workers that save you and make you money.

          In this case Boeing has to settle the strike first, then they lay off employees though I am still looking at who is getting laid off right now.

          They are using the cover of the strike to eliminate white collar jobs. Devil in the details is are they bad people to get rid of or just whacking? That is what the core aspect is.

          The manager at my last job hated me, because I saw through all his BS and was in a position I was consulted with by the client (it was my main non self assigned job). So I could call it garbage when I saw it.

          Nothing wrong with selective cuts but if they are going to do any good, they have to be worthless people not your good ones.

    • Perhaps Boeing is already considering border crossing immigrants as the replacements for 1/2 the price.

      • The Canadian unemployment rate is at 6.5%. Not sure if that would help any? It’s almost a 3 hr drive from the Vancouver area to Seattle.

          • Something tells me that farmers using immigrants to pick fruit, or contractors picking up workers at Home Depot at 6AM to hang drywall, or having some guys come around to handle lawn and garden care…

            ….isn’t the same as working at Boeing, where SSN’s, technical certifications and the like – are required.

            Not to mention the cost of living in the area. Perhaps you should read Scott’s article:

            https://leehamnews.com/2024/10/14/pontifications-boeing-needs-massive-reset-and-not-just-with-labor/

            And what it costs to live in the Seattle area.

          • @ Frank P

            On the other hand, Boeing has been hiring ex-KFC and ex- TacoBell, and paying them less than the starting wage at Target.
            Against that background, @Carlotta/Pedro have a point about southern immigrants.

            High cost of living? Packing them into dorms solves that problem — already standard practice in the UAE, Qatar and Singapore.

            (p.s. I don’t approve of such treatment at all, but it’s widespread in countries that are otherwise highly “civilized”).

          • I was speaking of the southern border immigrants.
            They would outwork the current boeing workers, be more grateful and be willing to work for less money.
            Boeing also needs to trim the fat from the top.
            To many overpaid, talking heads that contribute nothing, actually doing more harm than good as most are out of touch with the actual ground floor workers whom in my opinion are the heart of Boeing.

          • @Abalone & Carlotta

            I don’t know if you guys are being sarcastic, but for the sake of veracity, I’ll play along. Here’s why it doesn’t work and is the same dog whistle as “They’re voting illegally”…smh.

            Each employee requires a SSN. Especially at a large corporation, with payroll taxes, pension benefits, medical, training, etc. One which allows them to work legally and with so many places one can get tripped up and found out.

            Secondly, you can’t pay them ‘off the books’. Who is going to run to the bank to pull out cash to pay these people? Who’s the exec that’s going to have access to the bank accounts, that will sign off on a petty cash check (which is one of the things auditors check all the time) for all these people.

            If you’re a well paid employee, you going to risk it all for paying illegals?

            Thirdly, you have the Union watching everything, like a hawk. Either they have a SSN, pay union dues and work legally – or the union runs screaming to the press/authorities.

            Even greedy execs, who focus noting but financial metrics, aren’t stupid enough to risk using illegal labor at a large corporation, to save a few bucks. Maybe you could get away with a few guys, who cut the lawn – but not in the numbers you are talking about. And certainly not inside the plant.

            Anyone who has ever worked in a unionized environment, knows it’s like a bunch of chattering grandmothers at church, who broadcast to the world at large, when someone farts on the line.

            The only way illegal labor works is where there is cash involved. A customer can pay cash to a GC (customers love to avoid taxes, doncha know) who can cash out illegals for cutting lawns, hanging drywall or picking berries.

            And by the way – not for nothing, but the majority of illegals in the US arrive at parts of entry, are granted access on temporary visas (like students) and over-stay their leave.

            Even workers at KFC, Target and Taco Bell have SSN’s.

            Anyone who has ever run a business, knows that it’s a non-starter.

            ———————————–

            But let’s run some numbers, just to see how silly this is:

            BA said it’s cutting 17k employees. Let’s just say that they were unionized and the company tried to replace all of them, with illegal labor.

            Starting salary, per Scott, is around 40k – per Carlotta, they’re going to get half, or $20k.

            $20k x 17k workers is $340mn per year or $6.5 million per week.

            “Hi Mr Carlotta, how are you this week? How would you like your $6.5 million? 10’s, 20’s, 50’s?”

            Try that same exercise with 10% of the 17k workers, or 1,700 replacement illegals. Just 10%;

            “Hi Mr Carlotta, how are you this week? How would you like your $650,000? 10’s, 20’s, 50’s?”

            Petty cash checks, each week, for $650k. No one will notice that.

            You the one running to the bank, with the duffel bag, to do the pick-up? You also going to sit in the office, counting out 10’s and 20’s – on payday?

            “Gracias Senior. A proxima semana”

            Just brilliant.

          • @ Frank P

            You’re assuming we were talking about illegals.
            I wasn’t…not sure about @Carlotta.
            Someone from south of the border will be much easier to please than someone from north of the border — as @Carlotta points out.

            Who’s tending and harvesting crops in the southern US? That’s right — immigrants.
            Ever driven along the byroads of the Central and Imperial Valleys in California? “Welcome to mini-Mexico”! And they have SSNs!

          • @Abalone

            ‘You’re assuming we were talking about illegals.
            I wasn’t…not sure about @Carlotta.’

            Oh….ok.

            Well then, you’ll please explain to me why someone with employment status in the US, would accept getting 50% of what everyone else was getting, for doing the same job?

            Unless BA decided to fire everyone and start with a brand new work force, made up entirely of immigrants with status who know how to build commercial aircraft and have years of experience doing so. If they could get that past the NLRB.

            Even so, the engineers would be part of SPEEA.

            But if someone had status to work and could get a job at any company, why would they work at one that pays 50% of what they could get at another company, if they had the skills?

            Either way, it really doesn’t make any sense and is a dog whistle.

          • @ Frank P

            Just because someone has a work permit doesn’t mean that he has a job.
            And, if he has a job, he can still look for a job that pays him more.
            The average diner employee in the US earns $10.66 per hour, and the average farm worker in the US earns $16.20 per hour. Boeing’s $21 per hour is a 100% / 30% improvement on those wages, for less physical labor.

            The whole agricultural economy in California is founded upon people who are willing to work for less.

          • According to a report, [a]s many as 50% of Texas construction workers are undocumented. The industry is struggling with severe labor shortages, the result of a seemingly inviolable trend: as the U.S. gets richer, Americans are increasingly unwilling to work with their hands, no matter the pay.

            https://t.co/LTR2CaTm4h

          • @Abalone

            One final time.

            This was the original statement:

            ‘Perhaps Boeing is already considering border crossing immigrants as the replacements for 1/2 the price.’

            We’re not talking about people in Cali. We’re talking about BA.

            Immigrants (either legal or illegal).

            In the case of legal:

            Why would someone with status work next to someone, doing the same job, for half the pay…especially if there was a union involved?

            In case of illegal:

            A large, publicly traded company could never make this work, as the numbers showed you.

            It’s a dog whistle.

            Either way, it makes zero sense.

          • Frank P:

            Kind of like when Boeing was using Russian temp workers via illegal extended stays to replace legal workers?

            So let me tell you a story of holes in the system. I was required to submit to a background check. That was by the State (Airport access) the Feds (Custom Barnacle) as well as FedEx and my own employer.

            We had a fishy guy who struck me wrong. He was asking questions that had s simple NO, but kept asking. At the time we had a small union segment, so he was an apprentice with Millwrights (which requires back ground checks)

            I told him repeatedly that if he had something in his background he should back out, there simply was something off about him.

            He cleared everything but the very last check by the State for the test for Airport access. He had a conviction on his record (not the worst type) that absolutely precluded him from working in that kind of area by all 3 of the big boys. The Union did not find it either, a clerk on a last scan found it.

            So yea, people find ways around all that stuff and a SSN is required for a job.

            I don’t have a dog in the immigrant fight, but they are here in numbers and they are working. So tell me again how well the system works.

            Flip is you do have to demonstrate capability to get to Journey level, but apprentices or the equal do not. I have seen apprentices that were Journey level almost out of the chute, and I have seen life long apprentices who still get hired. They don’t get requested for hire for another job by the contractors, but when they need bodies? Yeah, they get put on.

            PS: I hung some sheetrock (not as a main job). There is no faking that skill. The good ones were hugely better than I was. If you can hang rock you are a rock start and my hat is off to those who do it well. Its an inate skill, you got it or you do not.

          • @ Frank P

            By definition, an immigrant is someone who crosses a border.

            Entire economic sectors use the fact that they’re willing to work for less — and to do work that others won’t do.

            Welcome to the real world.

          • That is not correct.

            A migrant or back in the bad old days, Illegal Alien is someone who just crosses a border no invited. Ergo the Illegal.

            An Emigrant is someone who legally moves to another country.

            Some Emigrants have good jobs waiting and some work lower paying jobs.

            Migrants and non skilled Emigrants take the low end jobs because that is what they can get. In theory both can have high skill levels and can’t get hired but generally not true.

            You also have Tourists. They can cross borders.

            And then there are students who cross borders. Diplomats and ……..

          • “An Emigrant is someone who legally moves to another country.”

            GrammarN:
            an “Emigrant” is a person that leaves a (usually native) country more or less for good.
            an “Immigrant” is a person that enters a ( foreign ) country for potentially longterm residency.

            Legal / illegal is orthogonal.

          • How many are flown in to work under H-1B in the tech sector??

          • Its in the tens of thousands if not hundreds of thousands.

            A bit of Flim Flam on the paperwork and whallah! That is what Boeing did with the Russians.

            Our former illustrious President was famous for lying on the paperwork to bring in out of country workers.

    • It was a good excuse to see the lovely fall colors in the Seattle area at this time of year 😂

      • You know Washington State is called the Evergreen State for a reason don’t you?

        You might get some non evergreens over the Mountains though I think most if not all of that has burned.

  7. Certainly there is an endless flow of new information about Boeing, so it certainly deserves a lot of discussion.
    On the other hand it has been a long time since anything happening at Airbus has got any attention. Maybe all they are doing is shaving pennies off each part on a continuing basis. Adding another ton to the max takeoff weight on the xlr, bringing it back to promised range. Maybe all the engineering talent is occupied with rate increases. But if they are not doing anything new there will be a talent drain and less senior engineers will not be getting the experience they need for the future.
    I wonder what we will find out when the smoke clears from the Boeing fires?

    • Airbus is working on multiple LH2 aircraft studies, and on the Wing of Tomorrow.
      It also has an A220-700 in the sidelines, and is considering an A330neo MRTT.
      Moreover, it’s part of the European FCAS fighter jet program.

      Sounds like quite a lot of innovation to me.

      • @Abalone

        Airbus almost has the opposite problem as Boeing. It is in relatively solid shape across its product lineup. You never want to turn off all development. But I am struggling to see where they really need to invest in any market segment to retain competitivness. An no…they do not need a bigger A350. They learned that lesson with the A380.

        • Both need to innovate with the upcoming environmental regulations.
          When air traffic picks up in earnest, larger aircraft will be better utilized in capacity constrained airports.

          Many airline have brought back the A380 simply for the max pax loading.

          The A380 was a different issue. The airframe was designed for 1000 pax. They did not have variants. At 485 pax, the ac is far overdesigned, at 800, it is still far under the design threshold.

          Now, with the A350 1000, with 480 pax, it will be very well suited to replace the A380, as well as several BA variants.

          The A350 is a far newer design than the 777X, and by all measures, a far better aircraft.

          • Smity:

            I think the A350 is a good aircraft and its newer of course with some major weight advantageous due to that and the CRFP build.

            That said, the 777X is not a slouch and it has the folding wings to get into 747 size gates.

            FedEx who I know all too well, has issues with wing size. The longer the wing the more it messes up their gates (and those are not jetway served though there are some cargo jetways in at least one location to get the freight onto the 2nd floor which is the feeder or was for that facility)

            I don’t see anything wrong with the 777X. Its Boeing incompetence that has lead to the delays that could be a death knell to it.

            Both are right at 212 ft wingspan but I suspect Airbus had to do the 212 ft due to gate issues and could have had an even better performing aircraft.

            Those are trade offs.

            What saved FedEx was they were setting up for the A380. In the case of Anchorage they added two gates to accommodate them and re-striped other gates to allow the 777F to work.

            But they lost spaces in the re-stripe areas.

            Clearly there is some desire for the 777X, it makes a dynamite freighter as well.

            But yeah, with more delays it could crater completely.

    • Airbus has several designs in the works. The A220-500, A350-1000, blended wing, and propfan designs.

      You must not forget that Boeing moved the main engineering design center to Moscow, with a secondary to Kiev.
      BA even contracted 100 engineers from Tupolev to work on fixing the MAX.

      BA has also opened an engineering design center in China.

      The software design center is in Bangalore.

      • @Smitty:

        Boeing had a Moscow design center but it was not the main one. It was an adjunct, they got the 747-8 work during the 7897 debacle (and that all had to be redone)

        It was nothing more than a sales aspect for Boeing in Russia at the time (now closed)

        So called centers are not what the name implies. They are or can be branches for local sales purposes.

        I do not know about their software. My experience with out sourced software was that when it got to where it was to be used it was re-written as it never worked.

        That is not a slam on over seas capability. Its the fact you have software people doing work for hardware they have never seen nor understand.

        Field application is where they sort out the flaws or re-write it. That was true when engineering was US origin and at a branch level where the engineers did know the field they were programing for.

        Its just a rushed job that tries to apply the specs but does not accommodate to the actual equipment being controlled. It generally was reasonably close but it always needed field mods to work per the reality.

        Boeing so called Enterprise system is a mistake in my view. The engineers are homeless. They need a home and nothign wrong with being leant out if needed, but just drifting around in a vacuum is not a good way to go.

        I did some travel work and it was fine, but I never lost my home base.

    • Huh? AB still has a few projects on hand, like the A350F.

      OTOH the result of recent development efforts by BA is, concerning, to put it mildly.

      • @Pedro

        No the well is not dry. A350F and XLR are still out there but are winding down. Ideally you want something to be in development to avoid the Boeing situation where everything needs work at once.

        Everything else that was mentioned is still an idea…Airbus will need to make the strategic decision to boost production before it goes after enhanced designs. Airbus has no problem selling everything they choose to make today.

  8. It’s almost like there’s a plan being implemented, under a cover of relative chaos.

    dunno.

  9. Companies can go on losing money for years (as Boeing has and continues to do) as long as someone – lenders, customers, equity holders or the government continues to supply them with cash. When that stops, the house of cards comes tumbling down. Ortberg has his work cut out for him, but the $150 stock price suggests Mr. Market still thinks they can pull it off. Otherwise Chapter 11 is the next option which allows Boeing to shed unwanted contracts and emerge slimmer and trimmer out the other end – at the expense of those shareholders whose stock value will crater (and bondholders). Biggest risk of Chapter 11 is what it does to the unsecured creditors – i.e. the supplier base. It would likely kill many of them.

    It is going to be a rough ride for the next while for all stakeholders including employees. Given the parlous state of this business, the IAM are in cloud cuckoo land with their expectations in this round of contract negotiations.

    • As for the IAM, their damage is already done. No turning back now with reorganizing Boeing That said, maybe IAM strike just accelerated the inevitable

      If Chapter 11 does happen, note to IAM members New Boeing can start with a new contract with IAM (assuming IAM forms as a union) IAM members will look back at “cuckoo land with their expectations” and wish they had accepted the 30% pay raise.

        • +1

          IAM members have done no “damage” to Boeing; they have merely pointed out that they *will no longer work for* the table scraps that that self-beleagured company ($63 billion in recent stock buybacks, not to mention a braindead C-suite) is offering. Blaming those at the bottom of the totem pole for mgmts failings is- uh- unwarranted.

          “Do as you’re told by your Betters, proles!” Mmm.

          • Asking a company with no money for a 40% raise & a government-style pension is ‘damage’ to the extreme…

          • @ Dave_A

            Define “with no money”.

            – BA has $10B in cash.
            – It has assets that can be sold for a handsome price, such as BGS.
            – It has an order book with huge revenue value, which it could turn into positive earnings if it got its production processes in order. One way to achieve that is to treat its workforce better.

            Conclusion: BA has plenty of money — it just has to convert it into a usable form.

          • @Dave A

            So when BA was flush with cash, spending money on stock buybacks, then hammered suppliers and employees for concessions, with threats to move aircraft production out of the state, that was….nice?

            If BA didn’t want to share the pie with employees, when times were good, what should the rank and file do now?

            Scenario #1

            Money is rolling in and we don’t want to give you any

            Scenario #2

            Money isn’t rolling in and we can’t give you any

          • Frank P:

            Yep, that was always the story. Oh poor us no matter how good things were going.

            One manager made the mistake of telling us the company was doing decently. Then it was, why no salary increase?

            They went belly up so maybe there is a long term lesson there but the Top Guys got the money and we did not get any more of it once they settled in.

        • Is it’s labor truly “skilled” when they are hired or do they learn those skills on the job – perhaps justifying a low initial starting salary which is very common as people learn a trade, but very useful for unions when bashing management. Kind of like pilots who probably don’t earn much more than $21 per hour to start their careers.

          I’m guessing that the benefits for even those new workers earning $21 per hour are significantly better at Boeing than at McD’s.

          • That would be my guess as well.

            You also have protection from jerk managers.

            I went through at least 5 different careers. It does take 3 years to get up to speed if you are any good at it, 5 years you really start to roll as you see repeats of problems and know what the fix is (depends on the trade).

            Surveying was a learn or just go home. Not mean but running an instrument is not normally a fast skill. Good news for me was the Party Chief could talk me through it. I was cheap and we made it work. I could not use a chain saw due to age (under 18 restrictions on power equipment).

            We also had the best survey instrument (transit) ever made (T-176). Easy to use and a tricky setup but once you mastered the4 setup, it was wonderfully.

            Granted that was the early days of going tech, the Transits before were a minaure version of what George Washington used. Latter I learned to read verniers, ungh. Give me a direct reading instrument any day of the week.

            Electro Mechanical tech was a good 3 years and 5 before I had it down good, and even then lots of landmines to step on.

            So 3 years is pretty much minimum for a truly tech area. Surveying I could get away with as I just had to do what I was told to. He was new to the instrument and only the setup was tricky and for some reason I figured that out and was quick at it.

            I never did do calcs, way past my level and that was what a Party Chief did.

  10. Reuters

    Boeing strike: US acting labor secretary to meet with both sides

    The International Association of Machinists and Aerospace Workers was not immediately available for comment. Boeing and a White House spokesperson declined to comment.

    A second phase of notices, if more redundancies are required, would be rolled out in December, the source said.

    A spokesperson for the Society of Professional Engineering Employees in Aerospace, which represents engineers at Boeing, said the company informed the union on Monday that 60-day notices to their members would be issued on Nov. 15.

    https://www.reuters.com/business/aerospace-defense/boeing-fine-tunes-job-cuts-major-buyer-slams-777x-jet-delay-2024-10-14/

  11. Let me remind you this is just another *periodic* mass culling, no matter it’s good times or bad. Don’t be fooled to blame those who are innocent.

    2016 The Seattle Times: Boeing job cuts this year could reach 10 percent

    “The workforce reduction is part of a major cost-saving push that also involves squeezing supplier costs, increasing productivity, shrinking inventory and cutting travel, overtime, services and contractor expenses — an effort that Boeing said “involves taking out billions of dollars in cost by the end of 2016.”

    If enough savings cannot be found elsewhere and more job cuts are required, layoffs would come later in the year, Boeing said. […]

    [BCA president] Conner first announced job cuts were coming last month in an internal webcast to all commercial-airplanes employees, a precise account of which has not previously been made public.

    According to a Boeing transcript of that webcast, Conner said the company needed to drastically reduce costs — and thus airplane pricing — because of *fierce sales competition* from Airbus.

    “Their biggest weapon that they’re using in the competitions today is price,” Conner told employees. “They are attacking us with price in every single campaign. And as a result of that, you know, we’re being pushed to the wall.” [with emphasis added]

    Well well well the result of such massive cost cutting means super profits under BCA’s magic accounting black box and anyone wants to guess who reaped the rewards built on sacrifices of employees and suppliers?

  12. So spirit is planning on building planes even though boeing is accepting delivery of anything. So they are going to start stacking fuselages on the tarmac. Talk about wasting money think about how much they are spending to move them from one plant to another to the tarmac and back through the same process a couple of more times. Also every big wig is always pushing the part to the next shop just to meet their deadlines even though the part isn’t ready. Case in point 777 lobe was loaded for shipment when it was signed off. Went out the door to collect the payment on it brought back in and removed out of the shipping container and replaces back in position just to have QA sign off. Why did we move it before it was ready??

    • I get the point but Spirit does not build planes

      It build parts of aircraft.

  13. Simple Flying: “Boeing’s “Reduction In Force” Plan Outlines How Mass Involuntary Layoffs Will Be Conducted”

    “According to Reuters, Boeing will issue Worker Adjustment and Retraining Notifications (WARN), or 60-day notices, in mid-November. Ortberg confirmed on Friday that the company will “reduce the size” of its “total workforce by roughly 10 percent” over the next few months, which is reportedly 17,000 positions. Following receipt of the notices, employees are expected to leave the company beginning in mid-January.”

    “The Seattle Times reported that Boeing will not offer severance pay to any of the affected employees. On Monday, the company presented its formal workforce reduction plan internally to its Commercial Airplanes managers, highlighting which positions will be axed. Since it is illegal to lay off employees on strike, the workers who are members of the International Association of Machinists and Aerospace Workers (IAM) will not be included in the job cuts.”

    “Managers are expected to decide who will be affected by the end of the month. In the first phase, oversight and compliance reviews will reportedly happen between November 13th and 15th. Then, the official layoff notices will be sent out, informing employees that their jobs will end on January 17, 2025, according to The Seattle Times. The second phase will only happen if the first phase does not achieve the 10% reduction target. Should it occur, additional positions will be axed on February 21st.”

    “The planemaker reportedly said affected employees will only be obligated to work for a few weeks after receiving their layoff notice, and they will paid until their separation date. They will also have time over the Thanksgiving and year-end holidays to search for other work. Boeing explained that it is “in the infancy stage” of piecing together its workforce reduction plan, according to The Seattle Times. As such, the timeline dates could be adjusted.”

    DON’T CHOKE LAUGHING AT THE NEXT QUOTE:

    ““We will be transparent with you regarding the timing and impact of these steps, and we will be professional and supportive to everyone along the way,” Ortberg explained to employees.”

    https://simpleflying.com/boeing-mass-layoffs-plan-2024/

    Very thoughtful to give the laid off employees time during Thanksgiving and Christmas to look for new jobs — that’s a really nice touch, Kel 👍
    Also: really nice of you to avoid paying any severance pay — it’s clear that you’re a real “people person” 👍

    P.s. Do you really believe that the workers in question will be doing any form of quality work in their final weeks after they receive their notices?

    • “You never want a serious crisis to go to waste. And what I mean by that is an opportunity to do things that you think you could not do before.”
      ― Rahm Emanuel

      • The problem thus created is that this kind of “overstepping” was frowned up because it was deemed (massively) destructive.

        Look at Israel leveraging that Rahm Emanuel “wisdom” fully unleashed.

  14. Being a union employee for many years, it bothers me to think how greedy this Union is. You will never see the money lost while striking. Go back to work for the sake of our country.

    • Take the manufacturing out of Seattle and out of the hands of these [Edited] unions !!
      They are greedy , lazy , no quality , against automation and they all feel they need to be paid like CEOs after just finishing high school

      • @ Boeingemp
        October 15, 2024

        “Take the manufacturing out of Seattle and out of the hands of these [Edited] unions !!
        They are greedy , lazy , no quality , against automation and they all feel they need to be paid like CEOs after just finishing high school”

        Is that the same Boeing where the mangers have been gutting the company for 25 some years, getting huge salaries and LOOSING money?

        Definition of a manager says its their job to manage a company not liquidate it.

        Workers build or fix things and its their tax money that corporations use to get bailed out when they go belly up.

        Seems the scum label is pointing in the wrong direction.

    • @RM:

      Right now a large majority do not see it that way.

      Long term obviously is what Boeing is counting on.

      Its funny that the Union has Boeing cornered, except Boeing went the same MO they did last time.

      Clearly they are waiting to see the numbers drop below 50% and then a deal is struck no matter how unhappy people are.

      Union leaders are weird, out of touch but regardless they serve at the current vote of the members who flat out refused the first deal, a small drop on the 2nd.

  15. “Boeing’s (NYSE:BA) stock erased a gain in premarket trading Tuesday after the plane maker filed a mixed-shelf registration valued as much as $25 billion to help strengthen its financial position amid a prolonged factory strike. The shelf is a preliminary step before a possible equity increase, according to a regulatory filing on Tuesday.

    “This universal shelf registration provides flexibility for the company to seek a variety of capital options as needed to support the company’s balance sheet over a three-year period,” according to Boeing (BA).

    The registration followed a $10 billion credit deal that also is aimed at bolstering its balance sheet. Boeing (BA) will pay a funding fee of 0.5% of the aggregate principal amount of each advance made with the agreement, according to a statement on Tuesday.”

    https://seekingalpha.com/news/4159232-boeings-stock-slips-on-25b-shelf-registration

    • They can’t take on much more debt, they’re already drowning in it. Needs to an equity infusion and I think they actually need at least $25 Bn.

      • A mix of ordinary shares, and possibly preferred shares (plus senior debts and/or subordinated debts). BA is going for a big one.

      • When I actually read it the $10B is immediately payable if/when Boeing issues new equity…so the intent is no incremental debt when all the transactions are settled.

        • My understanding is there’s a separate $10 billion credit facility set up in addition to the fund raise of (upto) $25 billion as a stop-gap measure. Any draw down of the credit facility will be repaid with the fund raised. It looks like BA/BCA is on the financial blink and need additional funding ASAP.

          • Ratings agencies have said that taking on any extra debt will trigger a rating downgrade…

    • I agree with Aboulafia: what the f**k is Boeing doing?

      Curiouser and curiouser.

      • Well, I think they need to cut costs and looking at that pie chart above the ”enterprise” section looks like it could use a diet. I’m sure there are plenty of powerpoint warriors they can do without…

      • Vincent

        Answer to your question

        “You never want a serious crisis to go to waste. And what I mean by that is an opportunity to do things that you think you could not do before.”
        ― Rahm Emanuel

  16. Reuters

    “Boeing factory workers will hold a large rally in Seattle on Tuesday to demand a better wage deal, mounting pressure on new CEO Kelly Ortberg to end a bitter strike that has plunged the troubled planemaker further into financial crisis.”

    IAM members have a complete disconnect on what’s going on Boeing hasn’t made a profit since 2017 and IAM members wants more, any other company would be asking for wage concessions if they were on the brink of bankruptcy

    • That is truly funny.

      Ortberg or the Boeing Board is not influenced by p[people running around Seattle.

      Purely a rally round the flag boys by the same leadership that said it was the best they could do.

      Strange stuff

        • Wow, that is true (or so I think , not sure how Boeing has survived so far but then unlike Frank P I don’t play in the world of high finance.

          The strike will be settled. Its a matter of when and how much damage is done.

          Maybe Chapter 11 after that?

          • “Chap 11 after ..”

            wouldn’t that nix any settlement with the workforce?

            Chapter 11 first and then woeing/enslaving the workforce 🙂

          • I thought we were already enslaved?

            A fine tradition exported from Europe.

            But yea, agreements are zeroed. Happens all the time. My company went through bankruptcy, got boat loads of money and I got a salary INCREASE!

            Why? Because I was by far the best tech and the new entity if it was going to survive needed a core of good people.

            As for the lucre offered the new Entity? Well you can’t do it again and you have all those cool contracts. Now, they did dump the Landscape Design Operation, The Filter Change Operation and the Meat Packing Plant sanitation.

            Kind of like GE, the former company decided that going into all sorts of touch labor stuff would make them attractive. Well it maybe worked for GE (they did have their good earning Health Care Division) but for small chump operations? Nope.

  17. “Boeing delivered just one 737 plane this month—yes, a single plane—as manufacturing remains at a standstill”

    “Citing data from aircraft data analyst Aero Analysis Partners, BofA analyst Ronald Epstein and colleagues said in a Sunday note that only one 737 jet and one 787 jet have been delivered as of mid-October. One other 737 has completed a customer acceptance flight, a test flight used to evaluate the function of the plane before it is delivered. No aircrafts expected to be delivered to Chinese airlines—where Boeing is expected to deliver 8,500 new planes over the next 20 years—have completed a customer acceptance flight this month.”

    “BofA expects Boeing deliveries to hover in the single-digits this month and maintains a neutral rating of the airline.”

    https://fortune.com/2024/10/15/boeing-737-delivery-delay-bank-of-america-doom-loop/

    • @DP:

      Thank you. Interesting stuff.

      One major problem is you have to pick a tech and that drives an entire design and its not easy or impossible to change it.

      So Boeing went with spun fuselage and Airbus proved you could do a frame and skin using composites that per Bjorn (not my area at all) is equally good (maybe more labor but less automation and equipment costs).

      I know Airbus replaced some parts of the A380 with a composite aluminum but could not do all of it that way.

      • Trans

        Good point, but if you can get rid of drill and fill fasteners, less work content and weight Also Airbus would need all new mfg. infrastructure which is expensive…most likely start with nose and tail assemblies which is difficult to automate to reduce labor content

      • The Boeing 787 fuselage is also a frame and skin semi monocoque construction.
        There is no other way to build except with internal ring frames – also composite but built and cured separately.
        Its like a composite wing – has composite outer skins with internal spars and ribs
        The only difference in A350 and B787 fuselage skin construction is one uses complete barrel sections on a mandrel while the other has long panels ( belly, crown and sides) which are then are combined to form a fuselage shape ( the rear section under the tail for A350 is a complete barrel section only )
        Once the skin panels or barrels are completed then the CF stringers are added to the skins for co curing process in autoclave.
        Ring frames are the last to happen. Photos show the 787 has closely spaced fuselage ring frames like the Airbus type

        • @Duke:

          We are going to continue to disagree on that and Bjorn made a clear report on the difference so I am going with Bjorn.

          Yes they are both reinforced. Airbus uses the aluminum frame build up but replaced with CRFP parts. They in turn rivet panels to the fuselage (7 or 9 as I recall).

          I don’t think Boeing rings are composite. Airbus is.

          Boeing fuselage needs less reinforcement (my take) enough to hold the shape.

          A moncoque has a frame built they you lay panels on top of the frame. Obviously Boeing system does not work that way.

          I think we can agree both are reinforced structures.

          For me the most interesting aspect is Bjorn lists them as equal in function and wright reduction. I would have though spun would have an advantage but I am going with Bjorn as he knows this stuff inside and out.

          I am familiar with structures, I build houses for some years and certainly worked in buildings where the floor loads and the structure had impacts on equipment.

          Clearly that does not quality me in structures. I have built sheds and such off my own plans and they are still standing so at least some knowledge there. ie better to overbuild than under as they don’t have to fly!

      • Spirits version has metallic support structures. This is all thermoplastic. So, 1 big step further…

  18. ‘Sounds like some BS to me:’ Boeing union members hold massive rally amid strike

    “I just want to call on Boeing to stop all the scare tactics and intimidation,” IAM General Vice President Gary Allen told the crowd. “It doesn’t work and, in fact, it makes us stronger.”

    https://mynorthwest.com/3998022/sounds-like-some-bs-to-me-boeing-union-members-hold-massive-rally-amid-strike/

    The IAM leadership is not doing their members any favors with this rally in the alley cries. A couple month weeks and another healthcare payment is due. IAM members need to stop drinking the IAM leadership Kool aid

    After all this, do you really think Seattle will ever have shot of FAL for new commercial aircraft in the future. IAM leadership is sealing the end of Seattle area aircraft mfg. ecosystem Hello South Carolina!

    • While the IAM members at the rally get a temporary high being with their fellow members and talking trash about their employer Boeing, reality sets in when they get home and look at the mail with the bills due- mortgage payment, truck/car loans and credit card balance growing

      IAM leadership is doing their members a disservice at this point. They are too oblivious to admit they are wrong about their stance and not willing to go back to the negotiation table with an open mind (note there is not a Boeing offer on the table at this time)

      • @DP:

        The reality of a Union in the US is that is how they act (or maybe better put that is the dynamic that has developed in the US between management and a union).

        Someone once said of US unions is the leadership has to offer more and more or they get turned out

        So rather than reasonable it becomes a race to the bottom aka the US Auto Industry.

        Management tends to act badly as well so you get the clash and nevermore looses.

        But yea, Boeing management goal clearly is the same as the last strike. Whittle down the ones who can’t pay their bills and then do a contract offer that passes, even if its 50.1%.

        Sad all the way around

  19. Boeing may want to make IAM a scapegoat for their current failures, but that just isn’t the case. Boeing’s, and the Machinists’, future was set long ago. This has never been a worker issue. At this point they are just arguing over who gets to lock the door when the plants are closed. It’ll take some years to fully shut down/sell off, or for a miraculous resurrection to take place. But Boeing will never be the same.

  20. “Rather, it was a defense company that also made commercial airplanes.”

    Considering that BDS has been in a vicious spiral for sometime, not good omen.

  21. Deltacis going to refurbish 757s with a new interior.
    How much longer are they going to fly those 757? Any guess?

    • @Pedro

      Delta will fly “anything” but they have a full MRO capability. They still own 118 B757. They also have 100 Max-10 on order that will they probably figure they should not plan on taking delivery of soon.

      Those will be solidly 30 year old (plus) planes before they are retired.

      This is the same airline that still flies B717 and was the last domestic airline to fly MD80 and MD90.

  22. Boeing’s Endless Doom Loop Gives No Respite to CEO Ortberg

    ‘“For every problem that’s come to a head, then severed, more problems sprout up,” Ron Epstein, an analyst with Bank of America, wrote in a note to clients. “The issues all feed into each other, creating a continuous doom loop while compounding the negative impacts.” […]

    But with so-called touch labor accounting for less than 5% for the total cost of a commercial aircraft program, some observers wonder why Boeing isn’t moving with more urgency to end the work stoppage that’s adding to its financial distress.

    “It’s not a needle mover in terms of Boeing profitability,” said Ken Herbert, analyst with RBC Capital Markets. “What are we waiting for here? Every day that goes by, it’s more disruptive and more of a cash drain.” […]

    He can’t win without the union,” Ferguson said of Ortberg. “He needs their heart and soul when they come back to the floor. If there was a honeymoon for the CEO, it seems to be over.”

    https://www.bnnbloomberg.ca/investing/2024/10/13/boeings-endless-doom-loop-gives-no-respite-to-new-ceo-ortberg/

  23. Adding: kind of a watershed moment when this kind of talk makes the mainstream.

    • ” “faster, leaner and more competitive,”

      Thats code for no new orders and losing money
      The Luftwaffe has ordered the F-35, who would have guessed?

      • For “nuclear sharing” after Tornado decommission only.

        It was indicated that qualifying the Eurofighter for the task
        would be made to hit snags to no end.

        honorable merchants all around.

        • There are many good salesmen on earth, what they can deliver is another matter.

          Apr 2024
          F-35 deliveries could resume in July, but the new jets *won’t be combat-ready for a year or more

          • The Great Heist

            -> The F-35 program has faced a slew of development problems, mostly due to excessive “concurrency,” which means that a system goes through development and procurement at the same time, making it harder to fix problems in testing. “We have signed ourselves up to pipe dreams with concurrent programs and a long set of capabilities for a lot of reasons that we decided, ‘Well, I have to have it, so it’ll be done in this timeframe,’ without the engineering rigor required to get those capabilities to actually get into the airplane, and all the things that go with that,” Schmidt said.

            -> Program officials want to change that with a plan to “reimagine” Block 4 and define “must-have” capabilities that industry will actually be able to deliver, according to his testimony.

            Through “Reimagined Block 4,” the program will lay out a plan to deliver upgrades in a “combat-relative timeframe” with a subset of capabilities already planned in the program, but only those that “give us the most bang for the buck,” Schmidt told lawmakers.

            -> Since July 2023, the Pentagon has refused to accept deliveries of new F-35s from Lockheed Martin because of software problems with Technology Refresh-3, which will give the aircraft the extra computing power needed for Block 4 improvements to sensors and weapons. The new tech was supposed to be fielded last April, but has been delayed multiple times and the Pentagon doesn’t know when it will be fully ready.

            -> The “best chance” the program has is to accept jets before TR-3 is fully finished, Schmidt said. Under this “truncated” plan, the Pentagon will receive jets loaded with an interim version of the TR-3 software.

        • Use

          -> “In the words of NATO’s first Secretary General, Lord Hastings Lionel Ismay, the alliance was created to “keep the Soviet Union out, the Americans in, and the Germans down.”

      • “…The Luftwaffe has ordered the F-35,…”

        In a limited number (35), and only for nuclear compatibility with NATO.
        It ordered a greater number of new Eurofighter Typhoons (58).

        • Well they had to.

          This is Europe. Germany makes Typhoons.

          They are going to develop an Electronica Warfare version (in 30 years or so)

          They will make great missile trucks for what the F-35 marks out for them. Those Meteors while not as good as an AIM174-B are pretty good miscles

    • IMU they are still expanding on the Civil Airliner side.

      i.e. probably transfers and not terminations

    • Unlike BA 👇

      Reuters:
      “Analysts expect the bulk of the job losses to be covered by retirements or voluntary departures.”

      Bloomberg:
      “Airbus said in the statement that it doesn’t plan compulsory actions to reduce the workforce.”

  24. recap

    According to Boeing’s “best and final” offer proposed on September 23, the average annual machinist pay at the end of the proposed 4-year contract would increase from $75,608 a year to $111,155. In its final offer to IAM 751 & W24 members:

    Boeing committed to building its next new airplane, in the Puget Sound region.
    A general wage increase of 30% over four years, up from 25%.
    A ratification bonus of $6,000, up from $3,000.
    A reinstatement of the Aerospace Machinists Performance Program (AMPP) bonus.
    A one-to-one match on the first 8% an employee contributes to Boeing’s 401(k) plan
    A lower cost share for health care
    A new employee annual floating holiday
    Boeing alleges that in its October 7 and 8 sessions, the company presented the IAM negotiating team “further improvements to retirement and incentives” above its September 23 proposal that included “guaranteeing a portion of the AMPP” and increased “annual pension payments for those employees who had Boeing pensions.”
    Boeing claimed the negotiating team refused to budge leading to the company withdrawing its offer and 33,000 union members awaiting “next steps.”

    https://lynnwoodtimes.com/2024/10/15/iam-boeing-congressional/

    • Do you have a solid source for your claim that an “average machinist’s pay would be $111k after four years”, per Boeing’s last offer?

      • According to BA/BCA… I’d need to see how Boeing massages the numbers to come up with this figure, including 401(k) contributions? Performance bonus? Education benefits? Who knows what’re included.

        • I was especially interested in the “average” notion.

          “Figures don’t lie, but liars do figure.” -Mark Twain

      • Something doesn’t make sense here. Let’s assume that BA is telling the truth about the average machinists pay being $75,608.

        Per Scott Hamilton, the 4 yr increase is:

        Yr 1 – 12%
        Yr 2 – 6%
        Yr 3 – 6%
        Yr 4 – 6%

        Yr 1: $84,680
        Yr 2: $89,761
        Yr 3: $95,147
        Yr 4: $100,856

        And just to be clear, this is the exact wording DP used:

        ‘the average annual machinist pay at the end of the proposed 4-year contract would increase from $75,608 a year to $111,155.’

  25. What’s the inflation over the last decade?

    WaPo:
    “The average pay for Boeing machinists has risen roughly 15 percent over the last decade to $75,000, a pace that is far behind soaring costs in the Seattle area, according to figures provided by the union and company. The region’s housing price index rose 128 percent in the last decade; the average home sale price in Seattle last month was $835,000.”
    https://www.washingtonpost.com/business/2024/09/17/boeing-strike-union-workers-contract/

    • Thanks for this comment. Hey, 15% and 128% aren’t that far apart- right?

    • Just for some relational information:
      How did income for jobs in general develop in the region?
      ( and US overall ?)

      globally my impression is that income evolution has been parted with an axe.
      Above average “earners” have seen raises well over inflation levels
      while lower incomes show a marked loss of purchasing power.

    • A dollar in 2014 is worth at least 1.33 today, based on the Fed.

      That means Boeing machinists today have lost at least 13.5% to inflation since 2014.

      • Yea and when you quit work there is no making up for inflation.

        So it goes, when you are working you can try to get more money, salary increase or change jobs.

        As you get older you got the stuff you need so inflation is technicality.

        Our house now costs us nothing more than taxes and utilities (and some maint that was always there).

        • Preach to the younger crowd who currently can’t afford to buy a house.
          Those who benefited in the past tell the younger generation to sacrifice! For what? To enrich those who own a bunch of stocks?

      • Machinists need an immediate wage increase of at least 15.65% increase just to cover the inflation of the last decade.

    • Thanks for that link. I find it *very useful* to see what’s been said before, and how it matches present-day realites.

    • The $10.000,000,000 in Boing FCF might come slightly later.
      The twelth of never seems likely..

      😉

  26. He saw his job as CEO to be mostly blowing hot air to lift the stock. Google “worst CEO’s” and see who pops up.

    • John, I love it. I might put it as all blowing hot air. Look at the debacles he has left in his wake!

      While the proof was in the failures, I loved what the shop floors said. Quality? We hear this, that and next week it is changed and not a clue what they are nattering about, it sure has not changed anything down here where it counts!

  27. I wonder if the Boeing strike negotiations are being run more by Ortberg or by Pope.
    Pope seems a continuation of the McNerny – Calhoun beancounter infection. I hope Ortberg replaces her with someone who is,the complete opposite. Is there an amti-pope?

    • Ms. Pope seems like a hologram, so far. I’m pleased to read that she has a Bachelor’s Degree in Accounting from Southwest Missouri University, though. Groovy glasses and eye makeup, too.

      “All is well, in the Garden.”

      • It would be nice if you commented on capability and not appearance.

        I believe that gets into Posting Violations.

  28. Stephanie Pope needs replaced asap.
    My vote is for the head of Janitorial.
    They have the skills and, educational background to recognize and flush out a stopped up toilet bowl such as the state of Boeing and as a plus, they’re not afraid to work hard and actually earn their money.
    I vote to replace the Pope halogram immediately.

    • Some think she is better than that and some do not.

      I do appreciate its purely based on skill assessment opinion vs an appearance thing like Vincent.

      I do not know and not afraid to admit it. Obviously I do not know her and I have seen endorsements and knocks.

      My biggest take to negative was Calhoun endorsed her and I find it impossible to think that is a good thing.

  29. Emirates is considering to order the A350F or the 777-8F as reported.
    What would you pick? How likely can BA deliver as scheduled?

    Etihad is also about to order passenger aircraft.

    • I’d take the A350F in a heartbeat. For one thing, it actually exists..

      • Real trumps vapourware every day of the week. Especially as there’s a strong wind dispersing said vapour.

        There’s all sorts of rumours along the lines that the only reason some airlines are placing orders with Boeing is to, in effect, prop the company up. No one wants an Airbus monopoly (not even Airbus).

        However, at some point airlines are going to have to place orders for actual aircraft that can actually fly and haul actual freight (self loading or otherwise) for actual revenue. The ones that over-do proppping up Boeing risk falling victim to their competitor who just quietly got on with ordering Airbuses good and early. It’s easy to end up being undercut.

        I’m fairly convinced that the flurry of 777-X orders in recent times is because some airlines – no doubt on the back of Boeing reassurances – considered the program to have moved on from crisis management to normal flight certification activities. Oops.

  30. I’ve just seen the news on BBC that Boeing is seeking to raise $35billion. That’s a lot!

    I wonder what they’re going to use it for. Debt payment? Though, $10billion of this is more loans.

    Staff wages? Or, a new model? Finally?

    Either way, it’s telling that Boeing is seeking to raise money in excess of that which Airbus are reputed to have lost on the entire A380 program. That level of new cash, if it doesn’t build some sort of aeroplane, would indicate just how dire a mess Boeing are in.

    • One of my points. 35 Billion more in debt and you are pushing 100 Billion. Boeing may be assessed as more than that, but its not really.

      None of the properties means anything without production.

      US Defense concern would be P-8/E-7 and the KC-46A. Two of those can be filled with used airframes. KCC-46A can be replaced by the A330MRT. No one would be able to buy BCA, no organization out there other than maybe RTX. NG does not want it nor LM. Its not being sold to China. Embraer? Too small to take on BCA.

      On the other hand all the Missiles stuff, T-7A, MQ-25, Helicopters etc would be snapped up by various others (LM would be happy with the T-7A and F-15EX go to NG.

      Sierra Nevada would be happy to convert NGs to P-8 and E-7. It all has to be entity with US defense secret credentials. Airbus might be eligible for some of it but that would not fly well.

      But you are not simply going to sell it for the parts, at a minimum there is too much US Defense interests that will stop that – BCA itself is a mess and the impact across the US would be huge. GE involved in all of it, BCA and defense and PW in defense.

    • Maybe they’ll just use the $35b to buy stock in Nvidia and Bitcoin and hope they time the market right. Lol

      • Dang, I wish I thought of that.

        Sort of like the Alaska dream, one more big project and I won’t urinate it away this time!

  31. IAM 751 remains bullish at rally as strike enters day 33

    but………

    “Holden’s promises appear to be at odds with continually increasing frustration among some union members who believe the union no longer represents their best interests.”

    “Boeing doesn’t need to [drive a wedge],” responded one union member. “Union leadership’s already done that for them by overpromising and underdelivering for years. At this point, the only thing holding the strike together is the free donuts at the picket lines”

    ““While the union packs halls chanting slogans like ‘one day longer, one day stronger,’ let’s be honest; no one’s gotten stronger after 33 days of standing around waving signs. The only thing growing stronger is the back pain from holding up those ‘fair contract’ posters,” responded one member on social media.”

    https://aerospaceglobalnews.com/news/iam-751-remains-bullish-at-rally-as-strike-enters-day-33/

  32. Interesting how intent Boeing management is on not giving more to the mechanics. Guessing they could end the strike by giving everything they ask for except the defined benefit pension. But for 20 years now executive management seems more focused on fighting battles than building planes. Management seems to have a “zero sum” view of finance, ie, they only win if someone else is obviously losing. It’s as though they don’t believe in win-win scenarios, no belief in the Mulally “partnering for success”. They basically got rid of Mulally (he left voluntarily cause he had hit the Welch-beancounter glass ceiling and was passed over for CEO) because they didn’t want to partner with anyone.
    Instead of “partnering for success” the board chose “crushing every constituency”, and they still have that mindset….a quasi-religious zeal to squeeze workers, suppliers, and customers…..and if a few planes happen to get built in the process that’s so much the better.
    But the prime directive is never to “boldly go where no one has gone before”, it’s more like to “boldly squeeze where no one has squeezed before”.

    • @John:

      You do have a way with phrasing things.

      I can see the Defined Pension off the table, but the rest?

      As a carrot to younger workers they could extend the new aircraft in WS indefinitely .

      As I read it, Boeing is listed as a 137 billion dollar company. As they will have right on 100 billion dollars in debt when all is said and done, hmmm.

      Now what the 137 billion means? Stocks? Its true value is not 137 billion. BCA is loosing money as is BDS. Some you could sell off at a profit, but the KC-46A? Nope.
      Same with the DeathStar Capsule. And the NASA to the moon? Phew, Wipeout – (bringing in the Beach Boys as background)

      When there is not an operation capable of running BCA? Piles of aluminum and CRFP is not worth anything (yea you get some nice Titanium Airbus would be happy to buy at the right price but….).

      Boeing is insolvent and even in 10 years if all went right, they might break even.

      • I haven’t worked at Boeing in a long time, but they cast a huge shadow and this strike is not good for the entire industry, so I hope it ends soon.
        Nevertheless, if there were a way for this to morph from a mechanics’ strike to a general protest against the Welch-Calhoun beancounter takeover of the industry, I would happily join. Especially if I get some of the free doughnuts!

  33. Apparently United is not betting on receiving its Max-10 anytime soon. Just announced they are taking 40 extra A321neo in 2026 and 2027

    • SW should be doing the same except A220 and or E2-195.

      Invoke the late clause and Boeing can even pay for them. Shoot what is borrowing a few billion more?

      • With the way SW puts seats in their airplanes A220s could hold between 130 to 150 passengers. Maybe the new regime that is looking to run LUV will realize at this point the network is what’s important and not the old way of sticking to an out-dated business model that has been encroached on by the ultra-low cost carriers. Heck, those old 737-only-lovers beside not wanting to update their planes, also stuck with used mainframes programmed with punch cards. What’s up with that?

        • They can do better than that. Here are two seat maps;

          https://www.seatguru.com/airlines/Air_Baltic/AirBaltic_Airbus_A220-300.php

          This is airBaltic

          Airbus A220-300 (CS3)

          Pitch Width Seating details
          Economy 32 18.5 145 standard seats

          —————————————-

          https://www.seatguru.com/airlines/Southwest_Airlines/Southwest_Airlines_Boeing_737-700_new.php

          This is SWA

          Boeing 737-700 (737)

          Pitch Width Seating details
          Economy 31 17 143 standard seats

          ————————————–

          The airBaltic A220 has 145 seats, with a 32″ pitch and 18.5″ width

          The SWA 737-700 has 143 seats, with a 31″ pitch and 17″ width.

          Yes, a proposed 737-Max 7 is 6 ft longer than a -700, so you’re probably adding a couple more rows in a Max 7, once you bump to a 32″ pitch.

          • Interesting. A220-300 planes are probably 4 – 5 years out from the day of the order;

            Where B737Max-7s are probably, are probably… I hate to guess on that, but if Boeing was up and running making good, safe planes, I would say maybe 2 – 3 years. But an order for the -7 could be 6 – 7 years away. Some reports are they want the MAX-10s out first, but really it has become quite messy. I have never seen a simple iteration of a plane take so long. Maybe the new contract will turn everybody’s attention back to building the airplanes.

            I just saw an article titled: The 10 Worst CEOs Ever
            Gentlemen like the Abercrombie and Fitch one; Maybe the crook from Wells Fargo; lots of familiar names. Boeing could have easily put three or four on there, but they had two.

          • what demarcations lines are associated with MAX7 and MAX10?

            afair there where promises made of backporting required features with certification of the MAX10 in conjunction with signing of on the MAX8/9 MCAS and associated changes a couple of years back ( allowing MAX8/9 return to service ).

            what may have been attached to the MAX7?

  34. All the fat at the top, who has created most of this financial setback with exception of Kay Sears and Stephanie Pope are all gone with their overpaod huge payouts and $$$ parachutes.
    Both Pope, Sears and the Board need replaced with new blood. The good old boys Club needs completely sanitized.
    I honestly feel that if Boeing doesn’t recoup its financial strength within 5 years, more criminal charges should be executed amongst the top level management who knew and was part of the decisions that allowed the slow death to financial ruin to happen. It was pure greed and incompetence.
    If this cannot be done, then I’m personally hoping Elon Musk buys Boeing and renames it.

    • “The new review will probe issues like risk-assessment quality, resource allocation, and adherence to regulatory requirements, and is expected to take three months, the FAA said. An FAA spokesperson said the agency plans regular reviews of Boeing.”

      “An FAA audit of Boeing completed in February found 97 incidents of noncompliance, spanning “issues in Boeing’s manufacturing process control, parts handling and storage, and product control,” according to a U.S. Senate report, adding that the FAA found 23 examples where employees “failed to follow processes or lacked proficiency.”

      “A series of reports in recent years have raised concerns about the FAA’s oversight of Boeing. Last month, a U.S. Senate panel investigating Boeing’s culture faulted oversight by the agency.

      “Whitaker said last month he would revamp the FAA’s own safety management program. He said in June the agency was “too hands-off” in oversight of Boeing before January.”

      https://finance.yahoo.com/news/faa-says-boeing-safety-review-132328537.html

    • The situation at Spirit is dangerously near the abyss.
      I think Spirit should pre-empt and prepare for the inevitable by setting up a new subsidiary (a paper transaction), transferring ownership of the facilities in Wichita, Belfast, Morocco and Malaysia to this new subsidiary (a paper transaction), and then selling that new subsidiary to Airbus for 1$.
      This would be more efficient than waiting for Boeing to acquire Spirit before selling off the relevant divisions to Airbus. Also probably easier to clear the hurdle of foreign regulators.

      • They have to be careful about a potential bankruptcy. Any assets transferred or sold within 90 days of a filing could be recalled by the courts.

        • There are also tax implications, e.g. with regard to internal transfer of IP.
          Nevertheless, it’s time to get the skids on this, because the situation is rapidly deteriorating.

          (And I meant Kinston — not Wichita — in the post above).

    • Reuters:

      -> Spirit has fully drawn a $350-million bridge term loan facility set up … and it is expected to be asking for additional help from the planemaker

      -> The furloughs, first reported by Reuters, will affect Spirit Aero employees working on Boeing’s 767 and 777 widebody jet programs.

      It’s said “the company has scaled back production of 737 MAX fuselages from 31 a month to 21 a month in August, September and October, and may have to reduce further.”

      • There’s a bigger picture to see in all of this Boeing
        drama, which also strikes me as a microcosm of
        other events. It’s slowly coming into focus,
        from my POV. Post-“election” it might be
        clearer- or not.

        Funny ol’ world..

  35. On the original topic: I hope this layoff affects two groups of managers more than others: 1) The group of corporate psychopaths that have saddled the company with white elephant projects for over a decade now (remember NMA, NLA, NLT, MOM, MAM, etc?) and are currently congregated around the dumpster fire that is the X-66. They deserve to be let go and their removal will make the company a better place by simply allowing better talent to flourish amongst the ranks. 2) The group of managers with a history of retaliation. Those of us in-the-know are aware of what the unwritten policy for these people has been; even if they get investigated by corporate (big if) for retaliation and are caught in the act, the worst that has ever happened to them is a 10-day suspension and being moved to a less desirable management position (the displacement is often waved for three years if there is a lawsuit involved). This unwritten policy is the source of a great deal of low-key damage to the culture of the company, and all managers tainted by it need to go now, period.

    • “The group of corporate psychopaths that have saddled the company with white elephant projects for over a decade now (remember NMA, NLA, NLT, MOM, MAM, etc?)”

      Next Gen Dynasoars should have 4 letter acronyms or just 2? :-)))

      • Yeah, I found Boeing’s endlessly changing acronyms
        for nonexistent aircraft to be funny, though not in
        a good way.

        “Paper aircraft are easy, and pay well for the moment!”

        What an outfit. So it goes with neoliberalism..

  36. I’m wondering if Boeing became Employee Owned and managed, if that wouldn’t make a huge and positive impact to the financial health and life.
    I feel that all employees would hold each other accountable from all levels.
    Abolishing all Nepotism and the good old boys Club.
    If I were a betting person, it would revamp the entire culture of Boeing and bring back the Pride, Respect and Accountability that is sorely needed.

    • How could 153,000 employees possibly cough up the $96B (current market cap) necessary to buy BA?
      That’s $627K per employee.

      And who’d want to buy a company with $60B in debt, and zero (or negative) EBIT?

      • Maybe it’s time for Embraer to make a tender offer…. Or propose a JV…..

        {sarcasm, of course}

        • It’s not a terrible idea. Boeing needs bodies and money to update their lineup and Embraer has to remember the way things turned out for Bombardier when they wanted to move up the product lineup.

          Boeing has so much to update across its lineup that it is difficult to see this happening without outside help

      • Pay $1 to buy it after the bankruptcy is filed, assuming trade debts but not bonds outstanding.

      • voting and nonvoting shares.
        Employees hold voting shares
        $vultures get the nonvoting ones
        ( but marginally higher returns )
        see Volkswagen.

    • “Employee Owned”

      Is there a single _effectively_ Employee Owned company existent in the US ? ( communism squaref, forsooth! )

      • I know previous mutual companies like policyholders-owned State Farm were converted into for-profits to benefit top executives.

        • This.. our Rulers would never allow a large-scale employee-owned enterprise to flourish: it might set a bad example.

          😉

      • Yes, Publix Supermarket for one and its thriving..
        I’m sure there are many others.

  37. “The Boeing strike is costing the economy more than $7 billion, according to new analysis”

    “The total economic loss of the strike so far, according to its numbers, has been $7.64 billion — the biggest chunk being $4.5 billion lost from Boeing, $648 million of lost wages within the aerospace industry and an additional $1.77 billion for Boeing’s suppliers.”

    “This is going to be an increasingly large share of the total losses. If the strike goes on farther,” said Anderson of the impact on suppliers.”

    “According to Anderson, $189 million has been lost so far from the Seattle-area economy outside of the industry, like local restaurants, auto shops and dry cleaners.”

    “Boeing is such an anchor of the export sector of the United States economy and so important to the Washington state economy that you can’t contemplate a long strike like this without some kind of negative effect on Washington state,” said Anderson.”

    “This week, Washington’s senators and two of the state’s U.S. representative wrote to Boeing and the union pleading for both sides to find a “mutually beneficial resolution.”

    https://www.scrippsnews.com/business/company-news/the-boeing-strike-is-costing-the-economy-more-than-7-billion-according-to-new-analysis

  38. IMO Boeings needs to invest in 787 midlife upgrade & 737 replacement.

    The US should subsidize $20B. Boeings goals and executie payment packages should be redesigned to abolish the short term profitability scheme. More US government, less WallStreet.

    Call it socialism, bail out, whatever, traditional free market capitalism drained the company / US civil aerospace to the edge of survival.

    • State-owned?
      That would be the ultimate irony, in view of the constant US complaints about “state subsidy” of Chinese industry.

      And BA has already received $90B in federal and state grants, subsidies and tax breaks since 1990 — didn’t achieve much, did it?

      • Hey, here in the Exceptional Nation we privatize the profits, and socialize the losses; didn’t you get the memo?

        😉

        • “we privatize the profits and socialize the losses”

          This has been the modus operandi for awhile.

    • “(Reuters) – A union representing striking machinists at Boeing said Saturday that members will vote Wednesday on a new contract deal that includes a 35% pay hike over four years that could end a more than month-old strike.

      “The latest offer includes a $7,000 ratification bonus, reinstated incentive plan and enhanced contributions to workers’ 401k retirement plans including a one-time $5,000 contribution plus up to 12% in employer contributions.”

      https://finance.yahoo.com/news/boeing-workers-vote-proposal-could-143553842.html

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