The Coming Boeing Bail Out

I thought at the time that it was a bad idea for the Pentagon to push for consolidation in the 90s, and in particular for the FTC to approve the sale of McDonnell Douglas to Boeing. History has proven me (and others) correct. The article doesn’t talk about space, but NASA’s procurement practices have been as bad as the Pentagon’s, in terms of encouraging and rewarding poor performance.

12 thoughts on “The Coming Boeing Bail Out”

      1. The F-111 is truly one of the most versatile air superiority fighters in the Navy or Air Force arsenal. 🙂

  1. The GOP was traditionally the go-to anti-monopoly trust-busting party up until perhaps the 1980’s, when some bigger-is-better thinking took hold, perhaps from the Chicago school.

    There was a whole lot more innovative designs coming out of Boeing, Consolidated, Catalina, Convair, Northrop, Vought, North American, Lockheed, Grumman, Republic, Bell, Hughes, Martin, Curtis-Wright, Vultee, and McDonald Douglas when they were separate entities run by engineers, even though their design tools were pencils, slide-rules, and T-squares.

    1. True, but there’s a lot less defense money for acquisition these days than there was during the cold war with a peer military superpower. That fact implies keeping the 3 remaining contractors permanently on line then there’s going to be delays and less “goof up” punishing competition. At some point competition with China might increase defense spending, at which point the Pentagon might be well served to nuture some addtional coporate sources.

  2. What’s the alternative? There doesn’t seem to be one. Airbus has its own problems. It would love a monopoly on large commercial but hasn’t the capacity to take up the slack. The A400 isn’t setting the world on fire.

    If you started today, how many years and how many billions to get back where we are now? If Boeing goes down the drain, its capability goes with it.

    1. The alternative was to have competing companies, not force them to merge. The British government did exactly the same decades ago, and now they really have no aviation business.

      Now, the alternative is probably to buy Chinese planes that are based on old Boeing designs that they ripped off.

      But it doesn’t really matter anyway. Airliners are a dying technology, because VR is going to eliminate most of the need to move bodies around the world. The future of flight will be drones, hypersonic small jets for those who really have to travel, and rockets for those who want to go into space.

    2. Let the company fail, go bankrupt, get bought out by private equity that then replaces management.

      The problem right now is that since the company is public, the owners can’t fire the entire management team and start over. There is no realistic mechanism for a publicly owned company to get rid of the board and execs. Not true if it is sold off to private equity.

  3. People never learn. The Brits ruined their aerospace business in the 50’s and 60’s by government forced mergers.
    They used to have Airspeed, Avro, Boulton-Paul, English Electric, Blackburn, Vickers-Supermarine, De Havilland, Hawker-Siddeley, Miles, Shorts, Fairey, Handley-Page, Bristol, Westland, Armstrong-Whitworth, Gloster, Percival, Saunders-Roe, Scottish Aviation and other smaller aircraft manufacturers all of whom produced numerous designs, some innovative, some very good, some bad.
    When consolidated I’m pressed to go beyond British Aerospace.

    1. I respect the French for giving their merged aircraft manufacturung bureaucracies utterly unimaginative names like North, South, then Aerospace and currently Airbus.

    2. The number of hyphens shows that this wasn’t anything new. Pretty much inevitable as airplanes went from something that could be built in a barn to wide bodies. Think Curtis-Wright, inventing the airplane didn’t even buy the Wright brothers 20 years of independence or even first billing.

      Boeing isn’t close to bankruptcy although closer than it was. If it ever comes about, it will be the equivalent of the fracking boom for lawyers. Whatever would come out the other end wouldn’t be worth much.

Leave a Reply

Your email address will not be published. Required fields are marked *