I don't think the rest of the industry or the followers here are going to grant him that reset of the clock.
I don't understand what you're trying to say here. If the 737 "only" matches the A320 sales 1:1 (or even 1:1.25 as I speculate), what is the industry going to do that amounts to not "granting a reset of the clock?"
In essence Calhoun is asking for a "mulligan", Boeing lost a year's production (due to their own ineptitude if not malfeasance), he's suggesting that not be included when comparing figures going forward, presumably production but perhaps also orders. He's trying to draw a line under the mcas tragedy and start a new era. Yet it's not that simple, the impact of mcas is still going to be present for many years to come, fiscally as well as emotionally.
The thing is, everybody asks about market share all the time, especially now. Before MAX, I didn’t hear much about market share? Or is it just me?
Boeing's posturing pre-tragedy was to not focus on market share, but focus on profitability. Now it seems Calhoun is deviating from that posturing, obviously because their post-tragedy debt load means they can't focus on profitability any time soon, they won't even be at break even till next year best case. Therefore he asks for a reset of the clock so he doesn't feel the pressure of the massive hits taken during mcas and covid. Seems to me he needs to work harder at sharpening this new posture he's taking.
The question was asked specifically about narrowbodies, but it sounds like Calhoun answered with a goal of 50:50 overall, not just 737 vs. A320. And he's clearly talking longer term, so I suspect he means the NMA will be a part of it.
Thanks for posting the transcript, but sorry, I don't read it that way. He gets asked about MAX vs NEO/XLR, makes his "split the market" comment then goes into a statement that can only apply to 737 production. The "segments" comment probably refers to MAX10 vs XLR and MAX8 vs A320neo given how the question was framed. I don't see how we can justify saying he was thinking about the overall market based on the comments.
The statement was not a planned, carefully articulated strategy, but a response to a question, and therefore I think should be interpreted as reflecting the general intent, rather than an explicitly quantified goal.
It was a question he should have been prepared for, the questioner even says he asked a lead-in question on the last earnings call. The CEO needs to be able to speak to this kind of question with ease, IMO. He does need to clearly articulate strategy, it's a big part of his job.
It was also informative to hear confirmed that the current delivery constraint is the customers. And of course, he brought up the big political concern, which is probably more significant for Boeing than Airbus, considering the Tianjin A320 final assembly line.
The situation is in deadlock, and IMO not likely to be solved any time soon. China's regulators still haven't said word one about the MCAS fixes, and once they do, it's going to be months before the airlines install training programs, get them approved, get the fixes improved, and finally get back in the air. China holds all the cards.
So what is the issue that MAX customers have that NEO customers don't?
The MCAS tragedy meant Boeing missed delivery dates, so customers had all the leverage in demanding deferrals or cancellations as covid hit. Since you can't sell an airplane that's illegal to fly, Boeing still can't deliver MAXes to Chinese airlines.
Meanwhile, Airbus customers have no built-in grounds for deferrals even though many want them, Airbus itself does not want to grant deferrals so it often doesn't, and Chinese customers have no regulatory impediments to accepting new NEOs. Their main problem is airlines like AAX who are refusing deliveries regardless of the consequences, they simply cannot cut the checks needed to make payments due to their financial situation.
Given China's domestic airlines are pretty much back to pre-covid levels and have been for a while and Chinese airlines have huge orders on the books, Team A has a big advantage over Team B.
I wonder where the focus on revenue and profit went?
Exactly my point. Calhoun is shifting gears, and isn't being very graceful and lucid as he does so.
If the market recovers fast, Airbus will be going back to Plan A with what, 80 A32X produced a month?, Boeing is in no position to match those numbers any time soon.
Airbus peaked at rate 60, and were preparing for rate 63, when the coronavirus crisis hit.
Now, from Airbus's own lips:
The new average production rates for the A320 Family will now lead to a gradual increase in production from the current rate of 40 per month to 43 in Q3 and 45 in Q4 2021. This latest production plan represents a slower ramp up than the previously anticipated 47 aircraft per month from July.
Ref: https://www.airbus.com/newsroom/press-r ... nment.html
Clearly they are in a better situation, but not 80 per month!!!
Looking at it from the current situation; It would be an dream scenario if Boeing could go back to 50/50 deliveries. The supply chain has shrunk drastically, QC problems are still occurring, airlines are not taking the planes so ramp up is not possible. Boeing going back to 500 deliveries per year within 3 years would be nothing short of an miracle.
While the frequently touted orders are nice, nothing beats deliveries…
As above, they had already dipped below 50:50 deliveries before the mcas tragedy, but they were OK with it. They were making every 737 they could possibly make, they and their supply chain were MAX'd out (lol) and lots of cash and profit were being generated. That's what their corporate messaging reflected, don't focus on A vs B stuff, we're making every cent we think we can make.
Now we see them asking to change focus, and doing so without much grace. I'm still not sure what overall message we're supposed to be receiving. Granted, they are in a difficult place (even if it is largely one of their own making) so coming up with a clear message isn't simple, but I'd hope for more clarity than what we're getting.
Good point on the ramp up, supply chain and QC issues. We're going to have to see strong execution going forward, and some movement on the China situation, for them to get back into the game.