United Airlines CEO says the airline will consider alternatives to Boeing
apnews.com
apnews.com
If we're being honest, I think the same is true of Google/Alphabet.
Except not really. The shareholders/board decided to gut the company so they can get richer with stock buybacks.
https://www.washingtonpost.com/business/2020/04/15/bailout-c...
> The shareholders/board decided to gut the company so they can get richer with stock buybacks
Are you not saying the exact same thing, just being more explicit about the implicit "short-term" profits?
The shareholders/board (e.g. Boeing...the decision makers) decided to gut the company so they can get richer (e.g. maximize [short-term] profits, since the profits accrue to the shareholders/board) with stock buybacks.
If a company goes bankrupt and it owes creditors, say, $10 billion, but together the board members have, say, $5 million in their accounts, creditors are still short $9.99+ billion. What value is there in that, apart from the moralizing?
The separation of 'natural' person [1] from legal persons[2] dates back to the Middle Ages and perhaps even Ancient Rome.[3]
It is how town/city charters were structured (the town is a legal person made of its inhabitants), as well as Medieval guilds (modern unions), universities,[4] etc.
Breaking down the legal separation could effect all of these legal entities.
[1] https://en.wikipedia.org/wiki/Natural_person
[2] https://en.wikipedia.org/wiki/Legal_person
[3] https://egrove.olemiss.edu/aah_journal/vol10/iss1/5/
[4] https://en.wikipedia.org/wiki/University#Medieval_Europe
Something tells me the board & shareholders will disagree if any criminal investigations are open on these failures. When companies break the law the shareholders never claim its impossible decisions were made without them. [1] [2]
[1] https://en.wikipedia.org/wiki/Wells_Fargo_cross-selling_scan...
[2] https://en.wikipedia.org/wiki/Volkswagen_emissions_scandal
So they spin off core manufacturing to a supplier and then squeeze them for pennies instead of concentrating on operational excellence and quality.
They whip their test engineers until they pass a product instead of learning lessons.
etc etc. Yes, this is all about incentives.
After acquiring McDonnell, Boeing went on a spree of divestments where parts plants that supplied them were spun off into independent vendors. One of the biggest of these is Spirit Aerosystems, which provides the fuselage assembly for the 737.
The divestments were specifically motivated by improving short-term profitability of the company, in the classic "sell it and rent it back" mode that's particularly in mode with private equity.
By all accounts quality control at Spirit Aerosystems has suffered since, with Boeing having relatively little leverage in improving this state of affairs (one may argue that it's not terribly interested in improving the state of affairs).
As far as we know the aircraft that kicked off this crisis was delivered from Spirit with an incorrectly installed plug door (more specifically, the bolts that secured it from opening were not installed at all)
Sure, not everything is corporate greed, but there's a really bright and direct line here between the financialization of Boeing in the mid-00s and this specific crisis.
This isn't default bad. Do you build everything at your company, or buy some things? Specialization can be a boon.
>with Boeing having relatively little leverage in improving this state of affairs (one may argue that it's not terribly interested in improving the state of affairs).
One might argue that Boeing isn't interested making sure their planes are safe? Absurd.
When you've outsourced the supply chain, personal responsibility is washed in a sea of lawyers, managers, buyers, and other personnel - the incentive to do your job to the 80-90% of completion and no more is extremely strong as it makes everything look better over the next 2-3 years.
In theory, you can pivot the entire knowledge "supply chain" to a different problem in 1-2 years in this manner. Shifting a contracted supply chain could take decades if it was even possible.
You seem to be under the impression I'm arguing a point that isn't in the text of my post. It's not material whether this is "default bad" - what matters is that it was bad in this specific instance.
The claim isn't "all outsourcing bad", the claim is a very specific "Boeing's outsourcing of these specific parts directly led to the safety crisis the company is facing now".
This is particularly salient as pre-divestment, what is now Spirit, did not have a notable QC problem. Boeing has in the past faced safety crises over the design of its aircraft, but not their manufacture.
Not everything is a proxy argument. If I mean my argument to be generalizable, I will state it clearly rather than leave it up to others to impute.
* There's a meaningful market for the components you buy
Does Spirit contract out to Airbus and Tupolev to build THEIR fuselages too? Are there other companies that could reasonably bid for the 737 contract? It feels like there isn't a real market here; they just divested a captive supplier for paperwork reasons.
* The stuff you're buying isn't your core competence
Sure: buy the fabric for the seat covers from a supplier. Hell, buy the whole seat. But airframes are sort of Boeing's core competency-- too much of the business rides on them to put them at arm's length.
Funnily, even with NASA's example, we have several instances of Boeing screwing up everything in favor of short term gains. ULA had to be 'forced' into existence by the government, because Boeing was caught conducting espionage on Lockheed Martin and was at risk of getting barred from government rocket launches (which would've left the US with only one launch service provider). They also tried to amend their bid on the Artemis lander competition, potentially after having info on others' bids leaked to them by a NASA insider. They forced ULA to severely limit the capabilities of Vulcan to not make SLS unnecessary (even tried to get people fired for it). Then, of course, we have the ongoing engineering disasters of SLS and Starliner.
I'm also not really sure how NASA fits considering that they have no monetary profit motive. They subcontract everything because that's just how the government does most of its procurement.
What is the evidence of that?
Certainly there's every reason to believe that they exceeded requirements by a lot: NASA not only has an astounding successs rate (in the most challenging engineering and manufacturing challenges in human history) but their missions tend to last far longer than the specifications. Voyager 1 and 2 are still flying, and so is that helicopter.
In fact, is there any organization ever that is a worse fit for the description, "did the bare minimum to meet requirements".
For an interesting description of how NASA engineering and budgeting actually work, here's someone from JPL (for a bit more, see other comments from the same user):
* The Space Shuttle - a death trap and reusable in no practical sense. Refurbishment involved near rebuild of large components. Often used as proof about how reusable rockets were not financially viable prior to F9's reliability.
* SLS (ie the rocket to nowhere) - too expensive and too slow to build to be worth using unless literally mandated by law. Is too rough of a ride, Orion's screens had to be modified to flicker in sync with the vibrations so that they would be readable. Congress (in blatant bias towards Boeing) attempted to mandate Europa Clipper to launch on it instead of Falcon Heavy, only backing down when told that they'd have to give Clipper an extra $1B (in addition to the $3B for an SLS launch) to make it able to handle the conditions imposed by SLS. Continues to be a burden on NASA's budget by eating up funding for other projects.
* Vulcan being forcibly neutered down to the bare minimum functionality needed to sell national security launches, because the original proposal would've reduced costs and removed the one existing need for SLS. They were proposing an upgraded second stage which would be able to be refueled in orbit and would've been able to carry Orion. Boeing tried to get the designer of that component fired. Also has the bare minimum to be 'reusable' by having an eventual goal of detaching the first stage engines from the body and splashing them down via inflatable heat shield. Basically does just enough to be a minimum viable competitor to F9 in national security launches and nothing more.
* Starliner with its initially poor software, stuck valves, fire resistance system that actually catches fire and parachute issues. Here Boeing got NASA to pay them extra money on top of the agreed upon fixed-price contract, holding domestic access to the ISS over them. Also tried to get SpaceX's contract cancelled and that money also awarded to themselves for no additional changes. The vehicle is designed for the bare minimum required for the contract (only 2 being built), with no interest in separate commercial activity the way Dragon is used in.
* JWST (ie the telescope that ate astronomy) - massive delays, budget overruns and serious failures in testing which caused another ~5 year delay. It was nicknamed "the telescope that ate astronomy" due to the budget overruns, which harmed several other telescope projects.
* Hubble - the work done directly by NASA was mostly fine, but contractors had large cost and schedule overruns, with the mirror issue due to a failing contractor and Lockmart facing cost overruns + not taking the initiative with designing the spacecraft for the telescope.
There is a heavy Boeing bias here since the main culprit in half of these examples is Boeing. But at the moment these were the main cases that came to mind.
The sad thing about these cases is that the early excuse for not taking risks with new companies like SpaceX was that they didn't have spaceflight "heritage" and couldn't be trusted to not cut corners in important places, with the implication that the established companies would be charging less if they could without compromising safety/quality.
I'll concede on JWST, but with Hubble there was a whole investigation that found the contractor's poor internal management was at fault.
The point is that subcontracting is not the problem.
What problems are you referring to?
But I dont think the comparison makes much sense.
Short term profits is what matter to the elite in these conglomerates.
Their stock bonuses should just have a 10 year lag or something. That would align their incentives.
And how could Airbus be more fierce?
That is not true. Long-term profits are by far the best thing for the owners in a corporation. See: Berkshire Hathaway.
What happened here is someone got to be in charge who did not have the brain to do the job.
When you see short-termism among CEO's, that's either due to
a) owners not aligning the CEO's incentives correctly due to the owners' negligence or stupidity, or
b) the CEO does indeed have the correct incentives, but is stupid.
Boeing profits have cratered since 2019: https://valustox.com/BA
If they focused on making great planes with reasonable R&D costs, everyone there would be vastly better off financially.
Just skimming the wikis for Boeing, the 737 MAX, and the A320neo it looks like Boeing’s downfall should largely be attributed to McNerney. Mullenberg is guilty of shipping a doomed product and botching the response to the subsequent crashes.
The idiots cut corners and didn't even save money!
It is genuinely important for big corporations to have owners with a very long investment horizon who are involved in corporate management. People who are planning for their great-grandchildren are essentially trying their best to set up a company that can last forever.
Aircraft development is hideously expensive. 787 development cost Boeing $32B, and is part of the reason why airlines pushed Boeing not to replace the 737 wholesale.
HackerNews seems to hate companies maximizing profits, but loves when people like Elon run roughshod over shareholders. I don't get it, either.
It's galaxy-brain stuff to believe that Boeing's biggest holders decided to make a few extra bucks in one year, and sink the 100+ year-old company the next. Versus, say, your theory that it's a multitude of issues relating to corporate rot.
There are multiple competing levels of profit maximization:
Short-term vs long-term
Personal vs. operational
Cheap vs. expensive
Easy vs. complex
Boeing was working on a "clean redesign" new airliner to replace the 737. They shopped it around and nobody wanted it. They did not want to train mechanics and pilots on a new type. They wanted a "better 737." Then Airbus came out with the A320neo and that also pushed Boeing towards another incremental rework of the 737 since a brand new airliner takes 10 years to get designed, built, and certified.
Many airlines use both A320 and 737s in their fleets too, so they already have pilots rated for two different types. Trading one of these entirely for a 737 successor doesn't seem completely infeasible.
But returns are probably quickly diminishing on the latter compared to the increasing scheduling, training etc. complexity of the former, and having two effectively similar classes of plane from the same vendor completely negates the benefit of supply competition.
That probably makes it very hard for a manufacturer to sell a new type of the same class to an existing exclusive customer: Short-term, the downsides largely outweigh the benefits.
In 2022, Calhoun received $22.5 million from Boeing. In February 2023, Boeing awarded Calhoun an incentive of about $5.29 million in restricted stock units to "induce him to stay throughout the company's recovery." In March 2023, Boeing announced Calhoun was being given shares worth $15 million that will vest in installments over three years.
Consequences for who?
Boeing is the stadium food of planes, poor quality & expensive, but if you're hungry you still eat it.
It could be, or it could be that these are the guys that know how to navigate through these risks that you mention - until something bad happens and the world is then bashing them. How many things happen and we don't see them? And they get f** rich thanks to that lack of information (which they can rely on thanks to us employees, who normally keep an eye closed or complain and "just create the Jira ticket, we will handle it later"). If this can happen in such a regulated industry, there are loopholes, and they can't be the only smart guys to exploit them to "accelerate, simplify, streamline profits" and all that.
It reminds me of the VW scandal. A lot of other companies did that artwork (using a defeat device) to pass the tests. One company got the blame - no problem there, but finally, it was like a wake up call for everyone else.
It’s not clear to me that this is the case here. The people responsible for ruining Boeing are all still fabulously wealthy and will be for generations. I guess you could call only having 20 lifetimes of wealth instead of 100 a consequence, but I certainly don’t see it that way.
Boeing is an incredible cash cow and is likely to be a duopoly (along with Airbus) for at least around 50 years or so. I don't see why anyone burn their house down for temporary warmth.
Also, the kind of issues we are seeing do not point out to any short term profiteering.
They cut 900 QA jobs, I bet this was doen for short term profits and I bet is realted with the issues we see. https://eu.usatoday.com/story/news/nation/2019/05/06/boeing-...
Muilenburg got $62.2 million for burning his house down:
https://www.manufacturing.net/aerospace/news/21109798/boeing...
You think he'd rather the company be successful in his tenure, or unsuccessful?
While Balmer was CEO the HQ was in Washington state :-)
More seriously, Balmer is an excellent example, because I believe the Boeing case is more mendacious, yet more banal.
Balmer seemed to have the right idea, yet utterly the wrong intuition. It's especially strange in that he was there pretty much from the very beginning, and influenced the growth of the business, yet fatally he never learned what the business actually was.
When Balmer took over MS, the business rested on several pillars:
1 - A captive client base based on CIOs and IT departments
2 - A dedicated and committed employee base
3 - A huge army of outside developers who benefited when MS succeeded, so helped the latter happen.
4 - A consumer business ultimately driven by the size of #1
2 - Picayune things like replacing free snacks with vending machines told the staff that he didn't give a shit about them, rather thought of them simply like a resource.
You can see from the "developers developers developers" video that he really did value #3, and much as I dislike him as a businessman I loved him for that. But eventually it became clear he understood its importance to the business but didn't understand why.
4 - this pillar flailed due to neglect under him, including Xbox, Skype etc.
He grew up with the car business, but grew up when the industry was in the shitter, surviving on momentum, and got his MBA in the intellectually (in regards to business) terrible 1970s. He appears to have learned nothing from his long time at MS before becoming CEO and ran the business like a shitty 1970s car company.
Note that the US car industry only got its act together after 1 - getting their clock cleaned and 2 - going back having gearheads as CEOs.
The Boeing case is similar, but worse. I never believed that Ballmer was subject to lazy or misaligned incentives; he was simply wrongheaded. I do thing the MCDD guys who took over Boeing were incentivised by their comp plans to optimize for the wrong things, all in the short term. The same thing destroyed HP.
What I find fascinating about this post is that it mirrors the same behavior I saw in a small tech company of < 10 employees after the founder sold it to a small group of investors.
Amazing to see a $1M company (1990's dollars) making the same mistakes as a multi-$Bn one.
My cab driver told me that when I was out there in 2011 and Boeing was getting ready to open their South Carolina facility.
I’m probably a minority of folks, but at this point I’m flying on airlines with the fewest Boeing Max generation planes in their fleet. I also don’t really trust the FAA to properly regulate Boeing after years of a close relationship—the recent groundings are the bare minimum.
Once the elite got rotten they need to be ousted, and the workers don't care (why would they?) and most shareholders have a voters' dilemma of caring at all due to too low stakes.
The only ones that care and can do something is the government, congress etc. Boeing need to be split up and sold off, and the management fired. But I don't see that happening anytime soon.
The models with issues appear to be the older ones with retrofits. Perhaps there are failure vulnerabilities when mixing today's computer-reliant design into past institutional-knowledge-reliant human design.
In particular, deliveries were stopped for almost two full years from September 2020 to August 2022, with more issues found recently. The Charleston plant is considered the worse one compared to Everett.
https://www.seattletimes.com/business/boeing-aerospace/boein...
https://www.heraldnet.com/business/last-everett-built-boeing...
It's one of them, but not the only (and I'd argue not the most). The A350 beats it for me, plus, it doesn't have that pesky range issue that is causing Europe to Asia carriers to adopt the A350 (detours around Ukrainian and Russian air space).
It was also grounded for a period.
My dream is to fly on an A380 one day.
So far the 787 has been the nicest long distance plane I've flown in (though I never did get a chance to fly in a 747).
In fact it might the only aircraft model that my wife knows by its designation, due to how good her experiences on it have been.
Also, what are your thoughts on the EASA and why they haven't banned the Max?
I find it hilarious how many people who mock people who "don't trust the experts" and "do their own research" suddenly engage in the same thing when it comes to other domains. Make no mistake: anti-Maxxers are kinfolk to anti-vaxxers, even if you don't want to admit it.
If your aim is to improve your immunity to an infectious disease, the only alternative to vaccination that fulfills the same purpose is to catch the disease, which is definitely not safer. If you are so afraid of FDA corruption in favour of pharma companies (or of needles) that you choose to avoid improving your immunity altogether, you're still at risk of catching the disease anyway, which is clearly less safe than any purported risk of getting vaccinated (that is, unless you make huge changes in your lifestyle to avoid human contact).
Your ending statement could hardly be further from the truth. There's no evidence that these groups of people are related.
There are people that state they'd rather drive than fly on a Max.
The worst that can happen is a statistically much higher likelihood of dying. On the other hand, if you don't take the vaccine, the worst that happens is Pfizer doesn't get your money.
Also, y'know, the whole increased risk of serious illness due to a lack of immune protection that would be granted by the vaccine.
Whoops. They are the same.
If we'd seen more thalidomide babies, or if people were being harmed en masse by vaccines perhaps things would be more comparable. But they're not so they're not. Besides, the FAA is explicitly tasked with promoting the business interests of American companies while also promoting safety. That's quite different than the FDA, and a more reasonable comparison would be between the FDA and NTSB.
Boeing’s reputation was on the quality of its engineering and production. “If it ain’t Boeing I ain’t going” was a real phrase. The current Boeing leadership has turned the company’s image of quality into the punchline of bad jokes. The only viable fix is a serious reset and sacking of most of the senior ranks to bring leadership back that understands the difference between short term profit and long term gain. This has all been sad to watch, but the flying public deserves better.
Does this the argument applies to this current ‘Return to office’ movement?
In a company with offices, social networks will mirror the physical layout because people will tend to talk to people nearby them in the building and not people in different buildings. By moving management further away physically, they also moved them further away socially.
But in a fully remote company it's not so clear, and more about the org chart and who's in the same Slack/Teams rooms or meetings.
This is a big ouch in so many ways.
Contrast "CEO says: Every plane is being completely inspected, every nut and bolt and nothing is more important to United than passenger safety and confidence."
Also - I wonder if Boeing even has the capability to build a new commercial airliner from scratch. The 787 was insanely expensive and had its own problems (remember the burning batteries?).
That's not correct. They have 220+ Max 8's in service.
I think United CEO's comment is at best a renegotiation attempt.
Consider if Boeing refused to build the MAX to be type rating identical. Southwest would -have- to buy and retrain. Sure, maybe Southwest would go to Airbus to spite Boeing, but I don't think that would happen if Boeing provided a better product. Airlines typically aren't that petty about these types of strategic decisions.
The MCAS fix themselves showed that MCAS wasn't fundamentally a bad idea - just that they had awful implementation (use both AOA sensors? Fail-safe if AOA sensors disagree? Provide proper limits and overrides?). And now after the entire kurfuffle and fixes, 737 MAX still has the same type rating as 737 NG in USA, Canada and Europe (that's just the ones that I checked).
MCAS and 737 MAX could have been a home run.
So, Airbus?
Though personally I would love a world full of E190s in a nice comfy configuration.
https://en.wikipedia.org/wiki/CSeries_dumping_petition_by_Bo...
This included the CSeries which became the Airbus A220, the primary competition for the 737 MAX-7
In a more ideal world, the people in management responsible for this mess would be brought up on criminal charges and forced to disgorge their performance-based pay that was based on fraudulent practices that harmed passengers, the workers of the company, and the economic growth of the USA. But, I'm afraid the best we can hope for is civil lawsuits brought by shareholders that will settle for a fraction of the economic damage wrought.
Undoubtably the FAA will be increasing its scrutiny of the company. But that will probably fall by the wayside if the Republican Party regains control of the government. The decrepit management team will probably pursue a sale of the assets at fire sale prices so that they can prop up their stock price and retire to a golf courses in "anonymity".
Is it just me or is every player in the dramatis personae dancing around this and/or burying the lede? If they were ordering regional jets, sure, you could buy Embraer or Bombardier, I guess. But as it stands it's like everyone's saying "we're considering alternatives to turning left"
To me, the fact that there really aren't timely alternatives doesn't take away from the gravity of a major airline CEO saying this.
> To me, the fact that there really aren't timely alternatives doesn't take away from the gravity of a major airline CEO saying this.
What's to worry about? United has no real alternatives. A shot across the bow implies that the next shot will be with intent to kill but united is stuck with boeing for at least a decade....
Sure, United might still be flying a bunch of Boeings, and maybe some other orders might still go through, but there are alternatives for United.
But this made me think of something funny... maybe Boeing could buy Boom, and Boom management could take over Boeing like McDonnell Douglas management has previously done, when Boeing bought them?
You could sort of imagine that airlines use this as an opportunity to fund promising smaller companies that want to scale (I'm not sure if Boom is more excited to become a major manufacturer or for the flight speed change)
Regardless, given the friction in training pilots to fly new aircraft, airlines losing faith in Boeing should make them more likely to consider it which removes a huge moat
Eh? No, that’s not right; it’s almost the opposite of what happened. Before the last decade, there was ~nothing. Around 2010, the Tesla Model S (high end), the Nissan Leaf (mass-market), Renault Zoe (mass-market), VW eGolf and eUp (mass-market) all showed up within a year of each other. The first Tesla mass-market car launched in 2017… kind of; realistically, 2019 (that’s when the ‘standard trim’, ie affordable, Model 3 showed up). In 2019/2020, the first high-end electric cars from conventional manufacturers also start showing up (e-Tron, Polestar etc).
Boeing is considered a strategically important business to the U.S. - they supply everything from airliners to bombers to spacecraft to cruise missiles. They also create jobs all over the place - taxpayer dollars are funnelled via the pork barrel to jobs programs.
The government cannot allow it to fail, and if Boeing looks bad, the government looks bad. Therefore anyone who makes Boeing look bad is an enemy of the government.
So - you end up with these noncommittal pieces. If they outright said “we are thinking of airbus”, you get the government banning the purchase of airbus aircraft, as that would endanger Boeing, and then you’re stuck with Boeing and the government wants to audit your everything and know why you aren’t standing in line behind the flag.
So the safe option is to make some noncommittal rumblings, and change nothing.
> If they outright said “we are thinking of airbus”, you get the government banning the purchase of airbus aircraft, as that would endanger Boeing
Er... if anything, the US government banning Airbus aircraft would endanger Boeing more than the alternative; this would absolutely beg for retaliation, and not just from Europe (China, remember, has its own 737-class plane, now).
This is a myth. GM and Chrysler are also strategically important firms. They were allowed to look bad. And while they were bailed out, it was done so through bankruptcy.
The U.S. makes international law - it does not follow it.
https://www.bloomberg.com/news/newsletters/2022-12-12/supply...
Businesses have self-interest; it's overwhelming and they can't escape it and its biases (though they can and should moderate it, and some businesses do that much better than others). Regulation provides an independent, expert power structure with great value where self-interest, or multiple self-interests, fail. It allows competitors to coordinate; to act with enlightened self-interest and (gasp) in the public interest - lawlessness is bad for business.
For example, in financial markets, unregulated self-interest leads to mountains of fraud, and a place where nobody wants to invest - that hurts everyone. A safe, fair marketplace attracts everyone.
For airplane manufacturers, self-interest drives manufacturers to cut corners. If you've ever advocated against cutting corners because of an over-the-horizon, non-specific risk (meaning, the consequences won't be tomorrow, and we can't say exactly what and when they will be), you know that you are violating social norms and can be very unpopular. But if you can say, 'this violates FAA regulations', then it's a clear and specific risk.
So you don't want regulators to do things that are not their minimum job, but anybody with a general argument against regulation is just trying to rob you.
What do you mean by that?
Of course, the real world is much noisier than that. But the most that free market advocates can claim is that regulators are inefficient, never that regulations are. Unless they are talking about some specific regulation.
> the most that free market advocates can claim is that regulators are inefficient
Beware of buying into their language. Regulations are necessary to free markets; unregulated markets can turn into monopolies or similar, making them very un-free.
If we stop using some word just because some con-man said them, we'd run out of words much faster than we could agree on new ones.
And worse yet, we'd give the con-man the power to decide what gets discussed or not, and would legitimize the behavior of switching words like they were fashion accessories, that is one of their main strategies.
One thing I worry about with complex products like aircraft in general, is what if we just forget how to do this stuff correctly? I mean the entire aviation industry was built in a single human lifetime. All of this was conceived and designed by our parents and grandparents. There's really no guarantee or precedent whatsoever in human history for that kind of knowledge transfer to occur between generations. I've been plagued by this feeling my whole life, that our generation (millenials and below) simply might just not be up to the task of keeping things going. It feels like we're starting to see those cracks.
Private companies are going to do what they are supposed to do: Maximize shareholder value. So they are going to cut corners, minimize spending and maximize returns by EVERY MEAN. It is the job of the regulator to establish strict regulations and ensure that they are followed; otherwise, to REALLY execute punishments.
The fact that the FAA has been lax with Boeing is what has enabled them to cut corners to this point.
Everything went to shit and Eisenhower saw it happen right before his eyes.
https://en.wikipedia.org/wiki/Military–industrial_complex
They basically let Boeing do whatever they want for National Security reasons.
That's easy when the PRC is mandating it, but given the hard earned safety record of say... Airbus, people are not in a rush to stake their lives and businesses on Chinese built aircraft. They're not exactly known for the transparency and integrity. In 20 years COMAC is likely to suffer multiple deadly crashes.
- the average 737 MAX 7 aircraft would typically carry between 138 and 153 passengers, range 3,850nm.
- Embraer 195-E2 carries between 120 and 146 passengers, range 2600nm
Scaling into the A320/737 range would need a brand new design with wider fuselage probably. I'm not saying that Embraer could not do that, but sticking with the E2/A220 size range seems to be a winning combo - until recently (A220), they had no real competition from the big two. Maybe with the more recent weakness from Boeing, Embraer might want to consider a 737/A320 class design, but these things take time.
Also, as much as BRICs is a thing, I don't think Brazil would be too fond of selling Embraer to China.
edit: to add some elucidation, United operate 40 737-700s that they may consider replacing soon, the E195 would be an option against the A320 or 737-MAX7 options.
Even if they had no intention of cancelling any ongoing orders, it'd be ridiculous to not strive for some compensation with this current Boeing hostile climate.
They are too big to fail. So they will fail together with the entire state.
4 domestic aircraft manufacturers of the 1960s (Lockheed, Douglas, Convair, Boeing) is now one.
Seeing as the CEO stated they are "going to at least build a plan that doesn’t have the Max 10 in it", they damn well better follow through and cancel those MAX 10 orders.
Words are supposed to have meanings, after all.
Public ownership is great and doesn’t necessarily lead to shitty products.
- showing his employees and the public where the blame belongs. No doubt United has some angry passengers given the flights they had to cancel due to the grounding of their Max 9 fleet. Also consider SNL’s sketch about Alaska… airline execs over there are no doubt fuming at Boeing.
2. Managing fallout from obvious losses from groundings
3. Showing investors that they can continue without Boeing should it regress further.
4. Kicking off bidding war between Boeing and Airbus. Boeing will give them an insanely good deal, especially if they announce their PO soon. Airbus is obviously also very keen on getting a foot in the door with United.
5. Sending a message to Boeing that they have had enough of this shit and it will really hit the fan if they don't get their act together.