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Did Boeing Secretly “Bet the Company” yet Again on an Airline Project?

31 points by chupa-chups 7y ago

PaulHoule 7y ago
I think Boeing stock has held up because Airbus has limited production capacity for the A320. The 737 and A320 split the market almost 50-50% and it isn't like Airbus can double their production capacity overnight to replace the 737. Marginally the 737 MAX problems will push some business to the A320 and will also help the rise of the A220/E190 class aircraft. It will take a long time though. In my mind it is a clear case of secular stagnation, under-competition and under-investment. One of the reasons why flying has gotten worse over the last 20 years is that the 737-A320 class has entirely pushed out widebodies in the U.S. domestic market. People make all kinds of excuses for the 737 but you shouldn't buy them. For instance, the 737 is a horribly loud aircraft. People will say "buy some noise canceling headphones" but what about the poor people on the ground? People will point to seat pitch as a factor and blame airlines, but seat pitch is one of three dimensions. The 737 feels cramped because of the low ceiling and it is stuck in a local minimum of comfort with 3-3 seating in coach. The A220/E190 class ditches the circular cross-section for something more appropriate for the human body. The planes are smaller but have a little more width with 3-2 seating. With geared turbofans, the noise level in both the cabin and on the ground are greatly reduced. These smaller planes feel like riding in a 767 or other widebody compared to the 737 -- it sounds like a boast, but flying is believing. It's like the Japanese cars in the 1970s that were big on the inside and small on the outside when American cars were the opposite.
Someone 7y ago
So, if Boeing kills of the 737, and Airbus can’t ramp up production of its plane in that class, who’s going to build them? Seems like a perfect opportunity for a Chinese manufacturer.
- PaulHoule 7y ago
  see https://en.wikipedia.org/wiki/Comac_C919 https://en.wikipedia.org/wiki/Comac_C919 I can't say I am exicted to fly on one but it's a competent 737 replacement.
Traster 7y ago
It's worth noting the massive incentive for a company to push the narrative that "One more big financial hit and we'll be gone! All those jobs destroyed!" - in the build up to what is obviously going to be a massive fine by a regulator that can be politically influenced. Boeing will be using every avenue it can to spread fear about what would happen if they get hit too hard by regulators.
cmurf 7y ago
Amazingly, most of the certification process for this new and very different plane was based on grandfathered approvals for the original 737, almost exactly 50 years earlier. That is an interesting claim about certification I haven't previously read.
- olliej 7y ago
  The whole point of the 737-MAX was that it was a modified 737, and that’s why what would now be considered unsafe design features were allowed (reducing development costs and time to fly), and why MCAS existed: to hide that it was a new aircraft. Every design decision in the 737-max is geared towards a plane that appeared to be no different from a 737 to pilots or regulators.

31 points by chupa-chups 7y ago

I think Boeing stock has held up because Airbus has limited production capacity for the A320. The 737 and A320 split the market almost 50-50% and it isn't like Airbus can double their production capacity overnight to replace the 737. Marginally the 737 MAX problems will push some business to the A320 and will also help the rise of the A220/E190 class aircraft. It will take a long time though. In my mind it is a clear case of secular stagnation, under-competition and under-investment. One of the reasons why flying has gotten worse over the last 20 years is that the 737-A320 class has entirely pushed out widebodies in the U.S. domestic market. People make all kinds of excuses for the 737 but you shouldn't buy them. For instance, the 737 is a horribly loud aircraft. People will say "buy some noise canceling headphones" but what about the poor people on the ground? People will point to seat pitch as a factor and blame airlines, but seat pitch is one of three dimensions. The 737 feels cramped because of the low ceiling and it is stuck in a local minimum of comfort with 3-3 seating in coach. The A220/E190 class ditches the circular cross-section for something more appropriate for the human body. The planes are smaller but have a little more width with 3-2 seating. With geared turbofans, the noise level in both the cabin and on the ground are greatly reduced. These smaller planes feel like riding in a 767 or other widebody compared to the 737 -- it sounds like a boast, but flying is believing. It's like the Japanese cars in the 1970s that were big on the inside and small on the outside when American cars were the opposite.

Someone 7y ago

So, if Boeing kills of the 737, and Airbus can’t ramp up production of its plane in that class, who’s going to build them? Seems like a perfect opportunity for a Chinese manufacturer.

PaulHoule 7y ago
see https://en.wikipedia.org/wiki/Comac_C919 https://en.wikipedia.org/wiki/Comac_C919 I can't say I am exicted to fly on one but it's a competent 737 replacement.

Traster 7y ago

It's worth noting the massive incentive for a company to push the narrative that "One more big financial hit and we'll be gone! All those jobs destroyed!" - in the build up to what is obviously going to be a massive fine by a regulator that can be politically influenced. Boeing will be using every avenue it can to spread fear about what would happen if they get hit too hard by regulators.

cmurf 7y ago

Amazingly, most of the certification process for this new and very different plane was based on grandfathered approvals for the original 737, almost exactly 50 years earlier. That is an interesting claim about certification I haven't previously read.

olliej 7y ago
The whole point of the 737-MAX was that it was a modified 737, and that’s why what would now be considered unsafe design features were allowed (reducing development costs and time to fly), and why MCAS existed: to hide that it was a new aircraft. Every design decision in the 737-max is geared towards a plane that appeared to be no different from a 737 to pilots or regulators.