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Comment by roughly | Hacker News Reader

If we're going to keep Boeing around because it's in the national security interest to have an American airplane manufacturer, we need to either nationalize it, break it up, or remove the entire leadership class. The company exists at this point for the same reason that Chase bank does: because they cannot fail, because we will not let them. The market structure will not work for this company, at least not the way corporate management is done in 2024, and if I'm the Air Force or any other branch of the US military reliant on Boeing goods, I'm not feeling particularly optimistic about my supply of Boeing parts, planes, and armaments right now.

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Breaking Boeing up would make it ineffective and likely lead to its failure. You could maybe spin off a couple small divisions, but not more than that. Nationalization is a non-starter in the US - not worth wasting the time and effort to try to make it happen. The only real option is to remove the current leadership, and place the company into Conservatorship to force the new leadership to do the right thing - ideally for at least 10 years, but 5 to 7 years would be the more likely political outcome of such a move.

I think virtually anybody who wants to see Boeing succeed long term, would get on board with this option.

At the same time, the FAA needs to be reformed (and funded) to bring it back to the enforcement agency it should be. They got into bed with Boeing and their lack of oversight in civilian aircraft let the corporate sickness fester and have a safe space from which to spread throughout the organization.

It's not clear to me that splitting up Boeing in commercial+business jet, defense, and space would make it more ineffective than its current incarnation? Boeing's ability to purpose build commercial jet frames for defense applications both seems to be... a) not performing well (see KC-46), and also b) not a future growth industry with the focus shifting to the Indo-Pacific and peer conflict (given the vulnerability of these types of platforms).

It's not a technical problem. It's that they need to stay too-big-to-fail, to be able to resist the very aggressive competition of other aircraft manufacturers. If they are broken up, the smaller companies would not be able to compete effectively, and they would also be immediate acquisition targets by largely foreign competitors.

I agree with others here that think they need to be a quasi-government-run company, but in the US that is done through oversight, managing the manager rather than stepping into the management role directly. Of course we have to absolutely gut that awful management with extreme prejudice, to start.

We should just go ahead and admit that Boeing is a government company, and that's what it takes to be one of the big-3 global commercial aircraft manufacturers these days (Boeing, Airbus, Comac).

Fire all Boeing senior leadership, go through the remainder of the company with a fine toothed comb and fire anyone mid-level who did anything dumb, then conduct a search to replace everyone.

Make the government an explicit stakeholde (25%?) with board representation.

Dilute shareholders ($0.50 per dollar?) for investing in a bad company, but make any employee shareholders who are still employed whole ($1 per $1).

Yup. There's no market pressure of note on Boeing, otherwise they'd be even the slightest bit concerned that their planes are falling out of the sky. They exist to turn government contracts into stock buybacks.

It's not true that there's no market pressure on Boeing. It's true that Airbus' production capacity limitations have blunted the impact of the QA issues on Boeing's financial performance, but Boeing is in fact suffering. They've been suffering for at least a year (their net profit margin has been 0 or lower for the last 4 quarters). Their stock price is down ~20% from a year ago, and is down ~35% from their high from just before the Air Alaska incidence.

The problem isn't that management assumed that there would be no market pressure, the problem is that management assumed that engineering and production excellence "just happens". They're not dumb enough to believe that shoddy products won't effect their financial position - they just don't know how to make non-shoddy products while also posting decent financials.

This company needs to be audited, starting at the top. Once a business is considered critical for natural security (Boeing is certainly in this category), it has an obligation to deliver with quality and on time. Boeing is failing and needs recovery.

a better bank would have been Wells Fargo. Chase and JPM are not in the same category they are profit machines with great balance sheets. that's why they swooped in last year during the bank crisis and took over some banks.

Wells Fargo is a better example of criminal vs negligent. Has Boeing verged into criminal? It's not like they were continuously bilking the gov't for all of this, which to me keeps them out of criminal. but of course, IANAL

Yeah, I'm mostly referring to Chase's relationship with the Fed, FDIC, and regulators - they're clearly the bank of choice for rescuing distressed banks, and they're the largest bank in the country by a pretty substantial margin.

You're right about the difference, though - they're stable, well-run, and with a solid balance sheet, and it's clear the tradeoff for being effectively the Bank of the US is they're regulated and stress-tested six ways to Sunday.

If that were the model being applied to Boeing, this'd be a different story, but I think there's been a clear decision made that Chase is critical infrastructure and should be treated & audited like it that hasn't been made about Boeing yet.

What’s the issue with Chase Bank and leadership that’s similar to Boeing?

Nothing I'm aware of with Chase's leadership, but they're the largest bank in the US by far by AUM, and that's because they've been the partner of choice for the FDIC & regulators looking to rescue distressed banks. In other words, they're a private corporation being used to fill a role the government deems essential, and consequently probably the safest place on earth to put your money right now, at least with regards to the risk of a bank failure.

(As I noted elsewhere, they're treated much differently than Boeing, in that they're audited, stress-tested, and generally put under the kind of scrutiny warranted by that kind of role.)

They are a big one but not the only one. We still have Lockheed-Martin, Northrop-Grumman, Raytheon (now RTX), General Dynamics, and maybe others.

Letting them merge with McDonnel-Douglas was a mistake.

Letting them merge? Boeing and McD were essentially forced to merge by the Department of Defense post cold-war. So were Lockheed and Martin-Marietta, and Northrop with Grumman, etc. It was in the national strategic interest, apparently. Recommended reading: https://www.wbur.org/onpoint/2023/03/01/the-last-supper-how-...

Only Lockheed and Northrop are only ones making military aircraft. Raytheon and GD have long stopped.

100% agree.

We need keep Boeing around so that SpaceX doesn’t turn into Boeing.

There's other competition out there.

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