5 ms·

NASA's Starliner decision was the right one, but it's a crushing blow for Boeing

52 points by LorenDB 2y ago

mglz 2y ago
Has there been any change in Boeing management (which is what led to the mess they are in)?
- fastball 2y ago
  Boeing has been mismanaged for decades, but they're a juggernaut so it has taken a long time for the cracks to start showing in such an obvious manner.
- alephnerd 2y ago
  > which is what led to the mess they are in The merger with McDonnell Douglas in the 90s. The deal flow and margins in commercial aviation were much higher than defense back in the 90s and 2000s, which deprioritized BDS and other defense aerospace manufacturers. This caused BCA to gain greater priority and status internally in Boeing. And due to Boeing Commerical's near complete dominance in the commercial sector in the 2000s and early 2010s, this lead to cost cutting for better margins: $9 an hour engineers in India weren't the problem (if so the AH-64 Apache would have a similarly horrid track record) - their union busting in Seatac by moving manufacturing to South Carolina and leadership to Chicago was the death knell, as experienced engineers, middle managers, and technicians didn't want to uproot from Seattle to SC or Chicago overnight.
- KoolKat23 2y ago
  Not yet https://investors.boeing.com/investors/news/press-release-details/2024/Boeing-Announces-Board-and-Management-Changes/default.aspx https://investors.boeing.com/investors/news/press-release-de...
rich_sasha 2y ago
I suppose it's precisely the existence of Boeing that keeps SpaceX "cheap" (I guess they are also good at what they do). I would imagine the minute SpaceX has no competition, it will lose all incentive to be cheap or good. Equally, perhaps Boeing knows that oddly they have utility as a runner up, and are unmotivated to do better. Interesting game theoretic problem.
- KoolKat23 2y ago
  Its privately held, would depend what Musk wants out of it, would he want profit above all else, this is doubtful. There's a case to be made for economies of scale, the long term opportunities this presents for mars etc.
  - bumby 2y ago
    Since you assume he doesn’t want to prioritize profit, what do you think he is prioritizing?
    - db48x 2y ago
      He’s said many times that his goal is an interplanetary civilization. Why not simply take him at his word?
      - bumby 2y ago
        Do you take politicians at their word? Car salesmen? If not, it’s because we recognize people have many different incentives than they publicly display.
        KoolKat23 2y ago
        What a cynical view of the world. Whilst it can be true (that people have different incentives than they display), it's not always true, nor necessarily important.
        bumby 2y ago
        Understanding people's incentives is extremely important if you want to understand their behavior. As Charlie Munger once said, "Show me the incentives and I will show you the outcome." Based on your replies, you seem to think neither incentives or promises are important in business and, given the context, possibly not even profits. To give you the benefit of the doubt that those aren't just shallow dismissals, what do you think is important?
sithadmin 2y ago
Is it really a “crushing blow”? Bowing’s continued success in the commercial aviation sector despite the MCAS issue seems to suggest that they are more or less untouchable. They’re too big to fail, and probably also too big to succeed.
- alephnerd 2y ago
  Boeing BDS is a different org from Boeing Commercial. Unlike Commercial, Boeing has competition from established players like Lockheed Martin, Northrop Grumman, BAE Systems, and RTX as well as rising players like SpaceX, Andruil, Shield AI, etc. Ther merger with McDonnell Douglas was the death knell for BDS because at the time, commercial dealflow was significantly greater than defense and space, leading to greater prioritization of commercial, and McDonnell Douglas had a history of management issues.
- mglz 2y ago
  It is a massive failure and also very public. Some flight booking websites now allow you to filter for non-boeing flights. Sure, Boeing can take a lot of hits due to its size, but damage accumulates, trust erodes and a tipping point could be reached somewhere. It's similar to how countries collapse in a war: First not at all, then very fast.
fifteen1506 2y ago
It's almost as if the management is so wealthy that it can retire now with no downsides and thus has no interest in building portfolio for their next job/company.
jmyeet 2y ago
More context: Airbus has beaten Boeing in orders and deliveries for 5 straight years [1]. Boeing does have a protected market because of the 737 type rating for airlines like Southwest but as we saw with the 737MAX, that comes at a cost. This is deeply embarrassing for Boeing. Their internal woes have bubbled to the surface and have started to affect planning, budgeting and delivery. This was for something designed to carry humans too. How much will Boeing have to do to repair their reputation and restore confidence in Starliner specifically but also their commercial spaceflight divisions in general? Compare this to SpaceX where the Falcon 9's recent incident broke a streak of over 400 successful launches. Falcon 9 is now the most successful and reliable launch platform and its also one of the cheapest. The Falcon 9 is really the Boeing 747 of space at this point. SpaceX has its own issues with delivering on time. Crew Dragon was late. Starship is behind schedule and (IIRC) over cost. But these issues just pale into comparison to Boeing's issues. [1]: https://archive.is/nzjKQ https://archive.is/nzjKQ
deleted 2y ago
[deleted]
mechhacker 2y ago
Boeing management seems to be the real crushing blow for Boeing.
mikewarot 2y ago
The Last Supper in 1993[4,5], is the likely root cause of all of this, in my opinion. It lead to the "feeding frenzy", a series of mergers. Its my understanding that the actual "crushing blow" for Boeing was the merger with McDonnell-Douglas[1] in 1997, and the profit über alles management style[2] that they were infected with as a result.[3] [1] https://en.wikipedia.org/wiki/McDonnell_Douglas https://en.wikipedia.org/wiki/McDonnell_Douglas [2] https://en.wikipedia.org/wiki/Late_capitalism https://en.wikipedia.org/wiki/Late_capitalism [3] https://indi.ca/the-boeing-737-max-and-the-crash-of-capitalism/ https://indi.ca/the-boeing-737-max-and-the-crash-of-capitali... [4] https://www.wbur.org/onpoint/2023/03/01/the-last-supper-how-a-1993-pentagon-dinner-reshaped-the-defense-industry https://www.wbur.org/onpoint/2023/03/01/the-last-supper-how-... [5] https://en.wikipedia.org/wiki/Last_Supper_(Defense_industry) https://en.wikipedia.org/wiki/Last_Supper_(Defense_industry)

52 points by LorenDB 2y ago

mglz 2y ago

Has there been any change in Boeing management (which is what led to the mess they are in)?

fastball 2y ago
Boeing has been mismanaged for decades, but they're a juggernaut so it has taken a long time for the cracks to start showing in such an obvious manner.
alephnerd 2y ago
> which is what led to the mess they are in The merger with McDonnell Douglas in the 90s. The deal flow and margins in commercial aviation were much higher than defense back in the 90s and 2000s, which deprioritized BDS and other defense aerospace manufacturers. This caused BCA to gain greater priority and status internally in Boeing. And due to Boeing Commerical's near complete dominance in the commercial sector in the 2000s and early 2010s, this lead to cost cutting for better margins: $9 an hour engineers in India weren't the problem (if so the AH-64 Apache would have a similarly horrid track record) - their union busting in Seatac by moving manufacturing to South Carolina and leadership to Chicago was the death knell, as experienced engineers, middle managers, and technicians didn't want to uproot from Seattle to SC or Chicago overnight.
KoolKat23 2y ago
Not yet https://investors.boeing.com/investors/news/press-release-details/2024/Boeing-Announces-Board-and-Management-Changes/default.aspx https://investors.boeing.com/investors/news/press-release-de...

rich_sasha 2y ago

I suppose it's precisely the existence of Boeing that keeps SpaceX "cheap" (I guess they are also good at what they do). I would imagine the minute SpaceX has no competition, it will lose all incentive to be cheap or good. Equally, perhaps Boeing knows that oddly they have utility as a runner up, and are unmotivated to do better. Interesting game theoretic problem.

KoolKat23 2y ago
Its privately held, would depend what Musk wants out of it, would he want profit above all else, this is doubtful. There's a case to be made for economies of scale, the long term opportunities this presents for mars etc.
- bumby 2y ago
  Since you assume he doesn’t want to prioritize profit, what do you think he is prioritizing?
  - db48x 2y ago
    He’s said many times that his goal is an interplanetary civilization. Why not simply take him at his word?
    - bumby 2y ago
      Do you take politicians at their word? Car salesmen? If not, it’s because we recognize people have many different incentives than they publicly display.
      - KoolKat23 2y ago
        What a cynical view of the world. Whilst it can be true (that people have different incentives than they display), it's not always true, nor necessarily important.
        bumby 2y ago
        Understanding people's incentives is extremely important if you want to understand their behavior. As Charlie Munger once said, "Show me the incentives and I will show you the outcome." Based on your replies, you seem to think neither incentives or promises are important in business and, given the context, possibly not even profits. To give you the benefit of the doubt that those aren't just shallow dismissals, what do you think is important?

sithadmin 2y ago

Is it really a “crushing blow”? Bowing’s continued success in the commercial aviation sector despite the MCAS issue seems to suggest that they are more or less untouchable. They’re too big to fail, and probably also too big to succeed.

alephnerd 2y ago
Boeing BDS is a different org from Boeing Commercial. Unlike Commercial, Boeing has competition from established players like Lockheed Martin, Northrop Grumman, BAE Systems, and RTX as well as rising players like SpaceX, Andruil, Shield AI, etc. Ther merger with McDonnell Douglas was the death knell for BDS because at the time, commercial dealflow was significantly greater than defense and space, leading to greater prioritization of commercial, and McDonnell Douglas had a history of management issues.
mglz 2y ago
It is a massive failure and also very public. Some flight booking websites now allow you to filter for non-boeing flights. Sure, Boeing can take a lot of hits due to its size, but damage accumulates, trust erodes and a tipping point could be reached somewhere. It's similar to how countries collapse in a war: First not at all, then very fast.

fifteen1506 2y ago

It's almost as if the management is so wealthy that it can retire now with no downsides and thus has no interest in building portfolio for their next job/company.

jmyeet 2y ago

More context: Airbus has beaten Boeing in orders and deliveries for 5 straight years [1]. Boeing does have a protected market because of the 737 type rating for airlines like Southwest but as we saw with the 737MAX, that comes at a cost. This is deeply embarrassing for Boeing. Their internal woes have bubbled to the surface and have started to affect planning, budgeting and delivery. This was for something designed to carry humans too. How much will Boeing have to do to repair their reputation and restore confidence in Starliner specifically but also their commercial spaceflight divisions in general? Compare this to SpaceX where the Falcon 9's recent incident broke a streak of over 400 successful launches. Falcon 9 is now the most successful and reliable launch platform and its also one of the cheapest. The Falcon 9 is really the Boeing 747 of space at this point. SpaceX has its own issues with delivering on time. Crew Dragon was late. Starship is behind schedule and (IIRC) over cost. But these issues just pale into comparison to Boeing's issues. [1]: https://archive.is/nzjKQ https://archive.is/nzjKQ

deleted 2y ago

[deleted]

mechhacker 2y ago

Boeing management seems to be the real crushing blow for Boeing.

mikewarot 2y ago

The Last Supper in 1993[4,5], is the likely root cause of all of this, in my opinion. It lead to the "feeding frenzy", a series of mergers. Its my understanding that the actual "crushing blow" for Boeing was the merger with McDonnell-Douglas[1] in 1997, and the profit über alles management style[2] that they were infected with as a result.[3] [1] https://en.wikipedia.org/wiki/McDonnell_Douglas https://en.wikipedia.org/wiki/McDonnell_Douglas [2] https://en.wikipedia.org/wiki/Late_capitalism https://en.wikipedia.org/wiki/Late_capitalism [3] https://indi.ca/the-boeing-737-max-and-the-crash-of-capitalism/ https://indi.ca/the-boeing-737-max-and-the-crash-of-capitali... [4] https://www.wbur.org/onpoint/2023/03/01/the-last-supper-how-a-1993-pentagon-dinner-reshaped-the-defense-industry https://www.wbur.org/onpoint/2023/03/01/the-last-supper-how-... [5] https://en.wikipedia.org/wiki/Last_Supper_(Defense_industry) https://en.wikipedia.org/wiki/Last_Supper_(Defense_industry)