Will Boeing Become The Next McDonnell Douglas?
 

Too big to fail - and who would buy them?

They have become MDD already in some way. They pleased the stock investors and delayed new programs buying back their own stock instead. Several programs were just minor upgrades instead of new ones. Now they need to invest big time. They missed to create some A321neo competitor in time even having the right plans for it early on.

In the short term Boeing's continued existence is wholly dependent on a smooth return to service of the MAX. One new MAX crash where there is any design or manufacturing nexus to Boeing and the company is done. Absent that In the medium term, as was suggested they will bumble along slowly loosing market share as they continue to prioritize short term share price gains over the kind of R & D that will build long term sustainability.

I would also suggest that the company value rather looks like a Ponzi scheme. All programs, especially the 787 program have used accounting tricks to give the illusion that they are profitable. For instance the last report I saw was that the 787 program now needs to sell 1580 airframes to amortize the development costs at the current unit sales price. Given that there is considerable pricing pressure on new build airliners that number is almost certainly larger. With the likelihood of a significant long term reduction in new wide body demand they may never reach break even. They can only kick the can down the road so far.

The 747-8 program has now ended so they will have to account for the Multi Billion dollar shortfall between what was spent on the program and what Boing realized

The 737 MAX is massively underwater and the bleeding will continue until all the grounded airframes are returned to service and production rises to profitable levels, which is probably more than 40 a month. This is likely not to occur until 2023

Assuming a negotiated settlement to the Airbus Boeing WTO spat, the ability of Boeing to get back channel help from the US government will be significantly reduced. And of course we have not even touched on the top down train wreck of a corporate culture with a 20 year emphasis on cutting cost at the expense of engineering and production excellence. The MAX fiasco was the inevitable result of that.

But the bottom line is Boeing did the unforgivable, they destroyed Billions of dollars of share holder value on something that they had total control over with respect to the MAX program failure. The next 2 years are going to see continuing bleeding so my fearless prediction is that in the 2023/24 time frame Boeing will be split into 2 stand alone entities Boeing Defense and Boing Commercial and the Boeing Commercial will be reorganized in Chapter 11 to shed what will have become an unmanageable level of debt.

Maybe out of the ashes a new Boeing positioned for long term success can emerge...

There comes a moment just before or just after delivery when customer and manufacturer are in closest contact.
If the manufacturer tries to mislead the customer, as McDonnell Douglas did with the MD-11, everyone will find out.
The beginning of the end.

Boeing already is the last McDonnell Douglas. The only reason they can't go out the same way is that there is nobody left to merge with.

One aviation pundit (cannot for the life of me remember who or where) said McDonnell Douglas bought Boeing with Boeing's money. And now Boeing finds itself in much the same situation as McDonnell Douglas...

Too big to fail, too much (financial) baggage to continue, and behind the power curve on new commercial product development. Maybe there's enough margin in the military programs to keep things afloat?

In my experience very few aircraft ever meet the brake even point with sales as ongoing R&D and model enhancement keep pushing the breakeven point further out. My experience with Boeing when competing against them in the 1970/80's was that their list price and contract price was often below production cost but they aimed to make up the shortfall over the life of the aircraft by very high pricing of spares.

Boeing could become the next Lockheed, after the Tristar they exited the civil aircraft market and concentrated on military work.

When we’re all flying around in Airbus and Comac aircraft we’ll be telling the new F/Os about the Boeing aircraft we used to fly. Just like the old timers used to talk about Electras and L1011s.

A bit far fetched ? Possibly, get back to me in 30-40 years time.

more like RJR Nabisco because Boeing is run by beancounters (like Nabisco) while McD was run by engineers.

correct me if I’m wrong, but Airbus got burned on both the 340 and 380. They are probably not in much better shape than Boeing. Embraer might be the better long term bet, possibly with a lot of Chinese money behind them.

osborne
And you could have mentioned the A220 that Airbus got almost for free too.

Boeing have one modern and highly competive aircraft family, the nine abreast B787. I will say the modern ten abreast B777X is currently not competive. It is too large and too expensive while not offering enough efficiency gains compared to its smaller competitors. And it is extremely vulnerable to a reengining of the A350/B787. The moment those aircraft get a new engine the B777X will be dead as the Dodo. The B737 is somewhat competive but not modern.

Airbus have no less than three modern and highly competive families, the five abreast A220, the six abreast A320 and the nine abreast A350. Add in the eight abreast A330 as a modern family and a comfortable aircraft, but a somewhat less competitive one currently.

Airbus is clearly in a much better position regarding comercial aviation now than Boeing are, much better.

Boeing has a huge military business. So maybe they can free the investments they need for new airliner developments?

Who will compete in the large jet market .Airbus can not surely become a monopoly, or can it? I know the both made the same mistake with quad jets. But the 747-8 (and 400) will probably keep the freight market interested and she may yet live longer than expected. But the A380 will go under. Although I agree about the A350 from what I have read that it's better plane than the 787. seems sad but due to mismanagement, Boeing has gone to pot...I hope that I'm completely wrong, except for my 747 8F prediction.

long time ago...

For me, it actually was the Li ion battery that made me say that I will never fly aboard one...EVER, rather be on a clapped out old 767. In fact, I would rather be on a 707 than a 787

You do know that the hull loss and fatal accident rates of the 707 are even worse the 737 MAX, right?
Meanwhile, for the 787 after nearly 10 years in service, the rates are 0.000000000

tdracer is right. Both Boeing and Airbus compile accident statistics. Take a look at this and compare the rates.
https://accidentstats.airbus.com/sta...rations-of-jet

Boeing's stats are similar. The 707, when it first came in, was one of the most demanding of civil jet aircraft.

Back then propeller pilots where not used to jet engine behavior and jet speeds. Procedures were made for slower aircraft and runways were shorter. It took some time for the entire system to mature for jets. My point is not only those early jet aircraft are to blame. The final piston airliner generation was not more reliable.