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Have been following Boeing, watching docs etc. Does anyone have any examples of a company this financialized and hollowed out making a comeback? I'm kind of ske

Have been following Boeing, watching docs etc. Does anyone have any examples of a company this financialized and hollowed out making a comeback? I'm kind of skeptical it's even possible

junaru 2y ago
Wont it just get bought out by the gov/taxpayer because it's a strategic asset etc. ?
renegade-otter 2y ago
Let's talk when GE becomes GE again?
- adventured 2y ago
  Just one piece of GE (GE Aerospace) is worth $200 billion now. The stock has tripled in eight months, with the company tracking to $5-6 billion in operating income and looking very healthy. GE Vernova (energy) is worth another $75 billion and is back in the black after years of losses. It's all probably going to be a lot healthier split up. That might be the case for Boeing as well. It's often the best way to restart failed old conglomerates (no Steve Jobs scenario is going to save Boeing).
  - renegade-otter 2y ago
    I actually didn't know that. It's been a zombie stock for years, so I just stopped checking.
    - adventured 2y ago
      Funny enough maybe GE Aerospace should buy the commercial plane division of Boeing. Take the business, engineers, IP and plants, ditch the management.
      - Mountain_Skies 2y ago
        Are we sure the rot hasn't trickled down to the engineering level yet? We know that once upon a time Boeing had great engineers and had an engineering culture but decades of MBA next-quarter management stands between that old company and the current Boeing. While I'm sure many good engineers still go to work for Boeing, what percentage of all the engineers and engineering managers at the company are top quality? Seems like over the decades that attrition, a failing reputation, and a focus on the wrong things would impact the quality of talent the company hired.
vasco 2y ago
It'll be a jobs program and a "compliance as a service" government contract middle man as other late stage big almost-state companies turn out.
bell-cot 2y ago
Maybe add "this large" and "this specializing in long-lead-time, cutting-edge technology" to your conditions.
mdorazio 2y ago
Apple was at junk bond status and very close to bankruptcy in 1996 before Steve Jobs came back and turned the whole company around. Most other success stories involve first going bankrupt (ex. GM, Delta).
- ensignavenger 2y ago
  A move which was partly financed by Microsoft. I don't know that Airbus would finance such a move by Boeing (but perhaps the US Gov will?) or who will "come back" to save the company.
- FirmwareBurner 2y ago
  Worth noting that Jobs made Apple come around due to the success of pivoting into a completely new and relatively untapped market at the time, the iPod-iTunes combo, which revolutionized the music industry enabling consumers to easily buy and own singles digitally and record studios to sell digitally for the first time, that's where the real genius was that nobody else on the market saw when Napster got shut down. Had Jobs kept Apple only in the computer business trying to sell colorful expensive iMacs as alternative to cheap gray PCs, they would have long been bankrupt and their carcass devoured by Dell or Lenovo by now. Boeing doesn't have any other new untapped markets they can enter and dominate. Come to think of it, neither does Apple now. They tried with the Vision Pro VR helmet thingy but that was a massive flop compared to the iPod and iPhone, coupled with the the shut down of their rumored secretive EV program, so they're left keep trying to milk that 30% AppStore fee as long as they can get away with.
  - adventured 2y ago
    Apple isn't left trying to "milk" the app store fee. That's a small fraction of their business. They're doing $300 billion in sales (and $100 billion in profit) in just iPhones, it's the most lucrative single product for a private company in world history (Aramco's oil business and Google Search are the only things that match up). The app store is a moat for the iPhone, not their primary financial success. They could make that app store fee 0% and they'd still generate over $100 billion in op income per year. Then they'd get sued by regulators for anti-trust for not charging a fee, claiming they undercut the competition using the iPhone business profits.
jajko 2y ago
One option is for government to step in, cut away the military support branch into a separate company and manage that. Leave the remaining stuff out in the open and either support financially to turn around (like banks in 2008 who then paid back with interest), or let it die due to market forces. Wondering what consequences all that mean for FAA and its international recognition.
- grobbyy 2y ago
  That would be a very, very bad outcome for the free world. We lost commercial ship yards, and or navy is on a long, slow march to obsolescence. That's messy decades it -- we have a huge lead -- but it's the path we're on. I don't know the solution here.
  - immibis 2y ago
    I don't see a problem with the military rotting away.
InDubioProRubio 2y ago
You can grow "external" daughter companies that have working "old" practices and get subsizdized by the dying parent, while keeping the MBA infection out as long as possible.
potato3732842 2y ago
Does it need to be under the same name? A lot of the "important names" in industrial manufacturing that wound up getting bought by the various industrial conglomerates of the mid 20th century wound up getting sold off when the conglomerates fell apart. For example IH's agricultural equipment (now a part of CaseIH), construction equipment (now owned by Komatsu) and truck lines (owned by VAG) all more or less continued development and production despite being through a couple owners at this point. I personally hope it gets split up and Ford winds up buying the passenger airline stuff so we can get a revival of the trimotor nameplate because I like it when reality is funny that way.
class3shock 2y ago
Electric Boat (US navy submarine maker) is trying. They were down to under 5k employees in the 90s (IIRC) after the end of the cold war and significant cuts to defense spending. Now they are probably over 20k and trying to increase production of one type of submarine, add a modified type to the same line, and build a new line for a new type. Not going perfectly but having billions shoved in your pockets sure helps recovery.

Have been following Boeing, watching docs etc. Does anyone have any examples of a company this financialized and hollowed out making a comeback? I'm kind of skeptical it's even possible

junaru 2y ago

Wont it just get bought out by the gov/taxpayer because it's a strategic asset etc. ?

renegade-otter 2y ago

Let's talk when GE becomes GE again?

adventured 2y ago
Just one piece of GE (GE Aerospace) is worth $200 billion now. The stock has tripled in eight months, with the company tracking to $5-6 billion in operating income and looking very healthy. GE Vernova (energy) is worth another $75 billion and is back in the black after years of losses. It's all probably going to be a lot healthier split up. That might be the case for Boeing as well. It's often the best way to restart failed old conglomerates (no Steve Jobs scenario is going to save Boeing).
- renegade-otter 2y ago
  I actually didn't know that. It's been a zombie stock for years, so I just stopped checking.
  - adventured 2y ago
    Funny enough maybe GE Aerospace should buy the commercial plane division of Boeing. Take the business, engineers, IP and plants, ditch the management.
    - Mountain_Skies 2y ago
      Are we sure the rot hasn't trickled down to the engineering level yet? We know that once upon a time Boeing had great engineers and had an engineering culture but decades of MBA next-quarter management stands between that old company and the current Boeing. While I'm sure many good engineers still go to work for Boeing, what percentage of all the engineers and engineering managers at the company are top quality? Seems like over the decades that attrition, a failing reputation, and a focus on the wrong things would impact the quality of talent the company hired.

vasco 2y ago

It'll be a jobs program and a "compliance as a service" government contract middle man as other late stage big almost-state companies turn out.

bell-cot 2y ago

Maybe add "this large" and "this specializing in long-lead-time, cutting-edge technology" to your conditions.

mdorazio 2y ago

Apple was at junk bond status and very close to bankruptcy in 1996 before Steve Jobs came back and turned the whole company around. Most other success stories involve first going bankrupt (ex. GM, Delta).

ensignavenger 2y ago
A move which was partly financed by Microsoft. I don't know that Airbus would finance such a move by Boeing (but perhaps the US Gov will?) or who will "come back" to save the company.
FirmwareBurner 2y ago
Worth noting that Jobs made Apple come around due to the success of pivoting into a completely new and relatively untapped market at the time, the iPod-iTunes combo, which revolutionized the music industry enabling consumers to easily buy and own singles digitally and record studios to sell digitally for the first time, that's where the real genius was that nobody else on the market saw when Napster got shut down. Had Jobs kept Apple only in the computer business trying to sell colorful expensive iMacs as alternative to cheap gray PCs, they would have long been bankrupt and their carcass devoured by Dell or Lenovo by now. Boeing doesn't have any other new untapped markets they can enter and dominate. Come to think of it, neither does Apple now. They tried with the Vision Pro VR helmet thingy but that was a massive flop compared to the iPod and iPhone, coupled with the the shut down of their rumored secretive EV program, so they're left keep trying to milk that 30% AppStore fee as long as they can get away with.
- adventured 2y ago
  Apple isn't left trying to "milk" the app store fee. That's a small fraction of their business. They're doing $300 billion in sales (and $100 billion in profit) in just iPhones, it's the most lucrative single product for a private company in world history (Aramco's oil business and Google Search are the only things that match up). The app store is a moat for the iPhone, not their primary financial success. They could make that app store fee 0% and they'd still generate over $100 billion in op income per year. Then they'd get sued by regulators for anti-trust for not charging a fee, claiming they undercut the competition using the iPhone business profits.

jajko 2y ago

One option is for government to step in, cut away the military support branch into a separate company and manage that. Leave the remaining stuff out in the open and either support financially to turn around (like banks in 2008 who then paid back with interest), or let it die due to market forces. Wondering what consequences all that mean for FAA and its international recognition.

grobbyy 2y ago
That would be a very, very bad outcome for the free world. We lost commercial ship yards, and or navy is on a long, slow march to obsolescence. That's messy decades it -- we have a huge lead -- but it's the path we're on. I don't know the solution here.
- immibis 2y ago
  I don't see a problem with the military rotting away.

InDubioProRubio 2y ago

You can grow "external" daughter companies that have working "old" practices and get subsizdized by the dying parent, while keeping the MBA infection out as long as possible.

potato3732842 2y ago

Does it need to be under the same name? A lot of the "important names" in industrial manufacturing that wound up getting bought by the various industrial conglomerates of the mid 20th century wound up getting sold off when the conglomerates fell apart. For example IH's agricultural equipment (now a part of CaseIH), construction equipment (now owned by Komatsu) and truck lines (owned by VAG) all more or less continued development and production despite being through a couple owners at this point. I personally hope it gets split up and Ford winds up buying the passenger airline stuff so we can get a revival of the trimotor nameplate because I like it when reality is funny that way.

class3shock 2y ago

Electric Boat (US navy submarine maker) is trying. They were down to under 5k employees in the 90s (IIRC) after the end of the cold war and significant cuts to defense spending. Now they are probably over 20k and trying to increase production of one type of submarine, add a modified type to the same line, and build a new line for a new type. Not going perfectly but having billions shoved in your pockets sure helps recovery.