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777STL
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 1:14 am

Which would do more damage, a plane that underperforms ala MD-11 or a few ASSUMED missed orders for understated aircraft specs?

The reprecussions of what happened to the MD-11 extended far beyond the MD-11 model line. How could airlines ever trust McD again after that debacle?

Whereas an understated 777-3ER, yeah, they POSSIBLY could have lost orders, but at least their reputation is intact and in the future, airlines will view Boeings specs as conservative, meaning that there's a good chance future Boeing models will have a little leeway in the court of public opinion.

It's all kind of a moot point anyway, the 773ER has done well.

Quoting Manni (Reply 46):
Boeings real competitor (atleast they tried) to the A332 was the 767-400 wich must have been the worst selling commercial aircraft ever,

I don't think the 764 was ever intended to go to head to head with the A332. It was essentially a purpose built model that accomplished its goal, to replace DL and CO's Trijets and keep them as valueable Boeing customers. Boeing knew they weren't going to sell 400 764s, any orders on top of what they sold to DL and CO was icing on the cake.

Has CO or DL ordered'received any Airbi since they took delivery of their 764s?
 
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EA CO AS
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 1:17 am

Quoting Manni (Reply 46):
Boeings real competitor (atleast they tried) to the A332 was the 767-400 wich must have been the worst selling commercial aircraft ever, after the concorde.

Er, no.

The A332's primary competitor was the 763ER. The 764 was a "boutique aircraft," if you will - specifically aimed at and ultimately ordered by CO and DL to replace their DC-10 and L-1011 fleets, respectively.

Neither carrier was looking for A332 performance in that role - the 764 fit, and it cost Boeing next to nothing to develop it.
 
manni
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 1:22 am

The reply " and after the A340-500, wich has sold 26, as compared to 37 767-400s" deserves the answer, I've given.

The A340-500 has been around for just over a year, there are no indications that these 26 will be the final count for that aircraft, while the 767-400 did not gain any new orders for 5 years, instead, 1 of 3 customers cancelled their order.

And the 'smokin' thing,  Yeah sure
 
astuteman
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 1:28 am

Quoting BoeingBus (Reply 11):
Boeing got sidetracked with this merger... Integrating the defense groups and closing down the MD11, layoffs, among others tasks.

Absolutely right, and it also had the additional effect of significantly increasing Boeing's cost base, just as the market went into decline - a very bad situation.
I don't think people should forget that Boeing are much deeper into the US market than Airbus as well, and despite a massive splurge of orders this year, how many are coming from the USA? When the US market does turn around, Boeing is likely to benefit enormously.

Quoting DfwRevolution (Reply 13):
In retrospect, Boeing has made a lot of smart moves that allowed them to rebound in a timely matter.

.

In fact for a company that saw deliveries drop from 600+ in 2001 to just 280 in 2003, they've done remarkably well - most companies in this situation would be racking up the losses now.....

Quoting JetMaster (Reply 26):
We shouldn't forget one of Airbus' main advantages was lower production costs

And it still is, by quite a large margin.
However, Boeing are working very hard on corporate costs (as recent actions show), and also at changing the construction cost paradigm with the 787 - watch this space....

Quoting Zeke (Reply 28):
they have discounted them 25% for SQ.

They'll still make a profit on those. People get too worked up about discounts on here. They're normal practice and have been for years. If you look at the sales and accounting data for both companies for the last few years, you'll see that TOTAL GROSS SALES for both have been at between 17% and 21% discount to list price overall.
Therefore if you're operating margin is 8% (as BCA is this year) of 12.5% (as Airbus is this year) as well, you can see there's lots of scope for discounting. BTW, these operating margins are set to increase for both companies as turnover increases - watch this space...

(For info, Indian Airlines 43 A320 family order lists on ave at c$64m a frame. Indian are chuffed to have got an ave. price of $54m/frame. This year's A320 family deliveries have averaged $41m in costs, plus another $3m on top for contribution to R+D - get the picture?)

Quoting BoeingBus (Reply 37):
Airbus was just fortunate to have currency hedges,

Or possibly managed the situation well? $43Bn of hedging does not "luckily" appear.....
 
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N328KF
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 1:47 am

This thread makes my brain hurt.
 
jacobin777
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 2:37 am

Quoting Manni (Reply 52):
The A340-500 has been around for just over a year, there are no indications that these 26 will be the final count for that aircraft

 confused 
 
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scbriml
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 2:44 am

Quoting JetMaster (Reply 26):
EK is replacing the A345 already? How's that possible without any B772LRs on order?

The same way SQ is doing it in reply 8 I would imagine.
 
lehpron
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 2:59 am

Quoting Kaitak744 (Thread starter):
This lead to significant order losses to Airbus.

Dude! If you are trying to make a legitimate statement objectively, then this was completely unnecessary. Hell, if that was just what you think or are sure of, qualify it by making it an opinion. No one's opinion is a fact, only to the person making it.

Anyway, a company (and it doesn't matter how long they have been in the business) will have trouble with regards to projects whereas much of it may be first-time or experimentation or niche. That's a fact (not an opinion). I don't see how anyone can take this and make it an emotional stance (unless you're a patriot of the subject matter, i.e. a fanatic). (that was an opinion)

Quoting Kaitak744 (Thread starter):
On the other hand, Airbus has in some casses over stated their aircraft specifications.

If you wanna make this about Boeing, then maintain the subject and don't stray. Unless you're trying to justify the other statement.

Quoting ContnlEliteCMH (Reply 2):
Let me see if I grasp this odd line of reasoning:

Odd to you and many others I'm sure, but what he has done is states Airbus' supposed pitfalls on Boeing supposed pitfalls.

How do people get so carried away with company patriotism...? I'll bet that by this 56th reply, the exact thing has already happened here but in support for Boeing or whatever company gets caught in the crossfire.
 
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zeke
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 3:08 am

Quoting Scbriml (Reply 56):
The same way SQ is doing it in reply 8 I would imagine.

did you read

Quoting Zeke (Reply 28):
This is what the SIA Chief Executive Chew Choon Seng said recently

"Singapore Airlines Ltd., which flies the world's youngest aircraft fleet, said it will pick from the newest models of Airbus SAS and Boeing Co. by as early as the year's end to add more routes to countries like China and India.

Singapore Airlines is considering Boeing's 787 and 747 Advanced models, as well as the A350 aircraft made by Airbus, said company Chief Executive Chew Choon Seng, in a Sept. 7 interview. The airline, Asia's most profitable, needs an aircraft that can fly more than 250 passengers on so-called medium-haul flights of less than 7 hours.

"We will be looking to place orders for additional aircraft, partly to renew the fleet because we have a policy of operating a young and modern fleet,'' Chew said. ``We will be looking at providing for expansion of our network.''

Singapore Airlines in August last year placed a $3.6 billion order for 18 Boeing 777-300ER planes and decided not to buy the 787 because it didn't meet "financial criteria'' then. Singapore Airlines has the option to buy 13 more 777-300ER."

No mention of 772LR...note the price of the 773ER, they have discounted them 25% for SQ.

They are looking for 30 A350s/787s for delivery in 2009 at the moment.
 
gigneil
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 3:11 am

Quoting DfwRevolution (Reply 13):
The 717 was designed for short-haul, truly regional, flying. Todady's customers desired not a regional aircraft, but a mainline-like aircraft for thin routes. Enter Embraer E170/E190 family.

This paragraph makes no sense at all.

The 717 is a mainline airliner, far more so than the E170. A mainline airliner with regional capabilities.

What people wanted was a REGIONAL airliner, with MAINLINE comfort. That is what the E170 is.

Quoting Stitch (Reply 18):
So yes, the 772LR is selling poorly, but it is selling to existing A345 customers, who are replacing that model.

Name one.

N
 
DfwRevolution
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 3:21 am

Quoting Gigneil (Reply 59):
This paragraph makes no sense at all.

Seriously, what is your problem? I don't buy the "let's all be friends and debate great aircraft" shtick, but your just an ass half the time. Father not love you and think taking it out on strangers will help?  Yeah sure

Quoting Gigneil (Reply 59):
The 717 is a mainline airliner, far more so than the E170. A mainline airliner with regional capabilities.

Why are you talking about the E170, rather than E190?

Quoting Gigneil (Reply 59):
What people wanted was a REGIONAL airliner, with MAINLINE comfort. That is what the E170 is.

What's regional about the E190? It has over 60% more range than the 717-200, if that's regional, so are the 733 and MD80.
 
Slarty
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 3:56 am

Quoting Zeke (Reply 58):
They are looking for 30 A350s/787s for delivery in 2009 at the moment.

Isn't A350 EIS in 2010? Oh well, i guess they are getting 787s then?
 
Thorben
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 4:19 am

Honestly, I don't see neither SQ nor EK phasing out their A345s.

Concerning EK, they don't even have all their A345s delivered. Besides, they don't have enough airplanes at the moment, why phase the newest??? It's like when you just bought a new car from a manufacturer, you don't sell it after three weeks, because the re-sale value has dropped too much.

And SQ? I guess this A343 vs. 772 deal they had with Boeing has gotten some Boeing fans a little too excited. Face it, those A343s where longer in the fleet and Boeing gave them a hell of a deal. Will Boeing do the same for newer planes which are way harder to sell (not because they are bad, but because they are a niche plane). Also interesting, if SQ has money for new planes, they'll replace their 744s first, which are, despite all rumors, not as efficient as A345s.
 
Dougloid
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 4:24 am

Quoting B707321C (Reply 33):
USD have followed roughly the same pattern against Canadian,Yen & Euro

Looks like it's more cyclical than anything else to me and none of it prevents one side or the other from hedging a large capital acquisition, so to say that there's a 40 per cent discount at work and that's all that makes Boeing or any other American company more competitive is simplistic.

See, here's how I'd do it...as soon as I committed the money I'd buy a package of offsetting futures...I think both sides are doing this...I mean, if I can figure it out you just gotta think that the big heads at B & A have it wired for sound.


....look at this report from the Bank of Montreal in 1998.... we're back to the mid nineties.

http://www.bmo.com/economic/special/bocdol.htm
 
whitehatter
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 4:46 am

All this thread consists of is cheerleaders taking the words of other cheerleaders as fact, inventing orders and making excuses.

Basic fact: Boeing has done badly mainly because they produce expensive aircraft off outmoded production facilities with massively top heavy management.

Add the arrogance of senior management (Condit and his refusal to chase hard for deals) and that is a commercial disaster. Wonder why Wal-Mart is full of Chinese goods people? Because they produce at lower cost and sell hard to their US buyers.

Airbus played hardball for deals and Boeing acted like king of the hill, appointing vice-presidents for everything from toilet cleaning to painting the hangar.

Grow up, cheerleaders. Boeing is a fat, bloated corporation that needs a dose of reality. Their products are overpriced and manufacturing schemes outdated. The 787 could be the biggest disaster in their history. It has yet to even be assembled, so how the hell can anyone make claims about its superiority or even say it will beat the projections? What if the prototype snaps in half after its first few flights? All possible.

Now we have a scenario where a competitor has chased hard for deals and won them in Boeing's own backyard. Airbus creatively costs deals, pushes hard and bags the contract. So the cheerleaders go off and start looking for excuses because they don't want to face reality. Can't face facts? Can't debate them? Try and sling mud at Airbus to smokescreen the issue, or look for someone else to blame for lost orders.
 
Thorben
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 4:55 am

Quoting WhiteHatter (Reply 64):
The 787 could be the biggest disaster in their history.

Yep.

Quoting WhiteHatter (Reply 64):
It has yet to even be assembled, so how the hell can anyone make claims about its superiority or even say it will beat the projections?

I agree, this Baseler already claims that the 787 is more fuel-efficient than the A350, although none of the two has flown a single meter yet, leave alone being assembled.

This time, Airbus comes from behind and will be the one to laugh last.
 
boeingbus
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:00 am

Quoting Thorben (Reply 65):
agree, this Baseler already claims that the 787 is more fuel-efficient than the A350,

Leahey said the same about the A350 being more efficient than the 787.

=--- So who is telling the truth?
 
Thorben
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:08 am

Quoting BoeingBus (Reply 66):
Leahey said the same about the A350 being more efficient than the 787.

=--- So who is telling the truth?

Good point, I guess the truth remains to be found.
 
Alessandro
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:15 am

Well, if Boeing wanted to keep competing with Embraer and Airbus, I think
they should´ve spent serious money on their product range, the B717 was
out-competed by Embraer and I don´t understand why Boeing didn´t build a
B744-SR, surely they could´ve sold a few of those.
 
Glom
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:18 am

Quoting WhiteHatter (Reply 64):
The 787 could be the biggest disaster in their history. It has yet to even be assembled, so how the hell can anyone make claims about its superiority or even say it will beat the projections? What if the prototype snaps in half after its first few flights? All possible.

After that, I expect no more complaints from anyone about A380 bashing.
 
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Stitch
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:30 am

Quoting WhiteHatter (Reply 64):
(Boeing) products are overpriced and manufacturing schemes outdated.

Well evidently Boeing is putting volume before raw profits, since they are winning orders and some of those orders (such a RyanAir's 737NG and El Al's 777) are deeply below "list". And Boeing is moving much of their production to a "moving assembly line" system which is lowering productions costs and production times a great deal.

So if "jigs" are "outmoded", then I guess that means Airbus is doomed from a production standpoint, since they are the ones left using them. :rolleyes:

Airbus was extremely aggressive in their marketing, and it did them darn well. And yes, Boeing was very much of the view of "What? Me Worry?" when it came to their customers.

But Boeing watched and learned and now is winning large orders, including orders from customers who were previously predominately or exclusively Airbus.

Yet that hardly means Airbus is "on the defensive" or "doomed to fail" as some on this board wish/want to believe. It just means that both companies have raised their games and, in the end, we the passenger are the beneficiary.

Quote:
What if the (787) prototype snaps in half after its first few flights? All possible.

Possible, but highly unlikely. Scale-model tests and computer testing will all be done long before #001 ever takes to the skies. Plus a number of military planes that Boeing works on, including the B-2A Spirit and the F/A-22 Raptor have extensive composite structures and they don't fall out of the sky at stress levels far beyond what a 787 will ever see. Plus the A380 herself is composed of a great deal of GLARE composites and she seems to sail quite serenely across the blue skies. And if Airbus felt they were unsafe, they wouldn't be using them in the A350 to help get her weight down to maximize her economies, as well.
 
anxebla
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:32 am

Quoting BoeingBus (Reply 11):
but Boeing losing the top spot wasn't from your theory of performance recalculations... it was bad corporate management and arrogance. Customers took notice.

Please, also add sometimes Airbus makes a very good product and usually cheaper than their NorthAmerican rival. This is true, above all, when we speak the A320-family/737 about.
 
777STL
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:35 am

Quoting WhiteHatter (Reply 64):
Grow up, cheerleaders. Boeing is a fat, bloated corporation that needs a dose of reality. Their products are overpriced and manufacturing schemes outdated. The 787 could be the biggest disaster in their history. It has yet to even be assembled, so how the hell can anyone make claims about its superiority or even say it will beat the projections? What if the prototype snaps in half after its first few flights? All possible.

They're not over priced, they just don't offer the cut-to-the-bone discounts that Airbus offers. I won't even get into why Airbus can offer those discounts, so I'll leave it at that. Needless to say, their costs and the risks associated with such are much lower than Boeing's, and not because they're better managed like you seem to be implying.

With the 787 and to a lesser extent the 777 Boeing has proven that customers will pay more for more product. I'm not saying this from a "cheerleader" standpoint as you so eloquently put it, but from a analytical standpoint.

Also Boeing is learning to woo customers as Airbus does, hence why they were able to beat Airbus to the punch with the NW 787 deal.

Here's a question for you, how the hell do you assume the 787 WILL be a FAILURE?

Honestly, you sound exactly like the militant cheerleaders you detest.
 
Morvious
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:56 am

Quoting Stitch (Reply 18):
SQ bought A343s(?) because the 772ER wasn't ready. As soon as the 777 was ready, SQ sold their A343s to Boeing and bought 772ERs. Now that the 772LR is ready, I fully expect them to get rid of their A345s, just as EK is doing and AC will do (now that the order has been revived).

So yes, the 772LR is selling poorly, but it is selling to existing A345 customers, who are replacing that model.

I think you are right about AC and SQ. But EK? Not in my lifetime.
EK will be a customer with both the 777LR and A345.

And I beleve the only reason now that the 777LR is selling poorly is because it is a very expensive plane to buy. There are enough customers for it, but airliners aren't doing great these days.
 
DCrawley
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:09 am

Quoting WhiteHatter (Reply 64):
The 787 could be the biggest disaster in their history..What if the prototype snaps in half after its first few flights? All possible.

You're right. It could be the largest disaster in their history. Yet, anything could happen. A nuclear bomb could go off tomorrow. Odds are though, one won't. What if the prototype does snap? You're right again. It could.You criticize everyone else and yet what you're saying is also pure speculation. Why not give Boeing the benefit of the doubt? I think they know more about what they are doing than you do..

Quoting WhiteHatter (Reply 64):
It has yet to even be assembled, so how the hell can anyone make claims about its superiority or even say it will beat the projections?

No one can actually predict the future, you are right. With the advancement in technology though, one can be quite close. I guess we'll have to wait and see?

Quoting WhiteHatter (Reply 64):
Can't face facts? Can't debate them?

You said NOTHING factual. Facts are backed up with proof and evidence. Anyone can say things about "I read this and I know this", but without documented evidence, it's not a confirmed fact.

Quoting WhiteHatter (Reply 64):
Basic fact: Boeing has done badly mainly because they produce expensive aircraft off outmoded production facilities with massively top heavy management.

That's not a fact unless you list some documented proof, which by the way, I'd love to see. This is your opinion. Please don't attempt to flame everyone when you are contradicting yourself..

-d
 
anxebla
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:19 am

Quoting DCrawley (Reply 74):
I think they know more about what they are doing than you do..

I agree with you, but sometimes it's a good idea don't forget something like this:

Quoting BlueSky1976 (Reply 3):
The reason why Boeing lagged behind Airbus wad due to some bad managerial decisions and not pursuing customer interests in few cases (jetBlue and Spirit come to mind here). They wasted too much time with 767-400 instead of jumping right on with what we now know as 787, while A330 was snatching potential 767 customers. To top it of, Boeing lost TONS of customer confidence after they cancelled 747-500X/-600X development programs. While Airbus was "sticking to their balls" with A3XX, Boeing was wasting time with combination of "nobody will buy it" agenda and the ill-fated 747X and 747-400XQLR studies.
 
DCrawley
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:29 am

Quoting Anxebla (Reply 75):
I agree with you, but sometimes it's a good idea don't forget something like this:

Point taken. I also think that history is history for a reason.. so we learn from our mistakes and experiences..

-d



[Edited 2005-10-12 23:51:09]
 
CruzinAltitude
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:38 am

Quoting BlueSky1976 (Reply 15):
Give the poor guy a break. Stop for a minute and think about what he's asking which I think is a good question by the way. All Kaitak744 is asking is suppose Boeing advertised the B773ER to be what it is (a better plane than advertised)?? Could we have seen more orders for the plane than we have today? I think the guy is right. It's more like thinking of buying a BMW as compared to a Mercedes but your main determinant here is fuel mileage. Mercedes tell you you'll get 18 miles/gallon whereas BMW tells you you'll get 20 miles/gallon in your new 530. You end up buying the Bimmer not necessarily coz you like it better but coz you're getting 2 miles/gallon better than the Benz. You later find out the Benz is actually getting 22 miles per gallon. Wouldn't you be disappointed that maybe you should have bought the benz? Now you start thinking 'damn, the benz even looks better but you're stuck with the bimmer... Ok, I know this is nowhere close to a comparison but think logically about the guys question before discrediting his thinking. He never said Boeing exceeding expectations was a bad thing for them but maybe it cost them a couple of orders to Airbus which could very well be true. In the long run, it'll pay off for Boeing but who knows, maybe they could have had 2 more 773ER orders before it actually hit the market if potential customers knew how good the bird would be.

Thank you for backing this guy up. If people took the time to read it they would see that his line of thinking is logical. I dont feel the issues he brings up would have hurt Boeing as much as he is proposing, but it is, after all, just a proposed idea.
 
Islandboy
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:45 am

Quoting Manni (Reply 52):
while the 767-400 did not gain any new orders for 5 years, instead, 1 of 3 customers cancelled their order.

KQ intended to order a B764LR model that Boeing decided not to build. Hence the B772ER was taken up instead. So saying that KQ cancelled their order is partly incorrect. As they merely took up slots for a different jet.
 
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Stitch
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:55 am

I imagine airlines look at a whole slew of financial and operational costs, and not just a narrowly defined set of "performance" specs. AI chose the 777/787 over the A340/A350 because - their words - they felt that the Boeing planes offered better revenue potential then the Airbus ones, even though Airbus offered a lower unit price then Boeing did. So price alone is not everything with at least some customers.

So Boeing "underselling" the 777 and Airbus "overselling" the A340 probably didn't have as much of an impact as many here are claiming - especially those who believe it was scores, if not hundreds, of orders.

If everything else evens out, then yes, performance can be one - even the - deal-maker/breaker, but if you fly A320s, A330s, and A340s and need a ULA airliner, even though the 777-200LR is the "better" plane in terms of performance, the costs of operating a single Boeing type compared to "suffering" with the A340-500 make the A345 the better value, I am sure.

Same if you fly 747s, 767s, and 777s. The A380 will be the "better" plane, but the 747ADV offers you a great deal of cost savings in crew, facilities, maintenance, and other costs, which probably negate the lower per-passenger costs of the A380.
 
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BlueSky1976
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:56 am

Quoting WhiteHatter (Reply 64):
The 787 could be the biggest disaster in their history. It has yet to even be assembled, so how the hell can anyone make claims about its superiority or even say it will beat the projections? What if the prototype snaps in half after its first few flights? All possible.

I can guarantee you, that you are wrong. Boeing is reinventing their entire supply chain around 787, and once the line start rolling, they will be a clone of Airbus Industrie with just-in-time supply inventory, parts of aircraft being manufactured at the same time at the risk-sharing partner's plants and transported via Beluga-747 planes from Japan and Italy to United States. Boeing learned a lot from how Airbus is doing their business and they won't make the same mistakes twice. Add to that Y1 and Y3 projects, then you'll have a reinvented manufacturing company with less people on payroll, producing more airframes more efficiently. They just will never in hell admit to the fact, that they learned it from Airbus Industrie.

As far as 787 snapping mid-air in half... dream on! The worst that's going to happen to that plane is the discovery that the gelcoat has to be renewed every 10 years on the composite airframe (something every owner of a composite sailplane or aircraft knew about anyway for decades now).
 
anxebla
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:58 am

Quoting DCrawley (Reply 76):
so we learn from out mistakes and experiences..

This is always correct for both, persons and companies.
 
MakeMinesLAX
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RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:59 am

Quoting RayChuang (Reply 36):
If Boeing had just developed the 727 powered by two PW2037 or RB.211-535C engines in the early 1980's it would have effectively cut off A320 sales almost on the spot.

They did - it's called the 757.

In retrospect, this was a smart move - the 727 had to get out of the way to let the 737 grow into the success it is today and the 757 fill the gap above that. Since the 737 went on to shatter the units sold record of the 727, and the 757 landed a respectable 1000+ orders, how can you make a case for Boeing's failure?

You also have to figure the MD-80 into the equation. There was simply an explosion of demand for aircraft of that size, and no single manufacturer could have cornered the market.
 
atmx2000
Posts: 4301
Joined: Wed Oct 13, 2004 4:24 pm

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 8:48 am

Quoting JetMaster (Reply 26):

We shouldn't forget one of Airbus' main advantages was lower production costs. Boeing reacted quite late to that.

Some of the reasons for those lower costs were for reasons out of Boeing's control, such as the exchange Euro-dollar rate.

Quoting B707321C (Reply 27):
And the reason why boeing is doing better the last year, is probably mostly due to the foreign exchange rate. A weakened dollar really helped US and Boeings export. The last couple of year the dollar has dropped in value by more than 40%. Which in turn gives non-us airline the possibility to by Boeing products much cheaper in local currency than expected. I am will say most of Boeings improved sales the last year is due to this effect, rather than change in management or improvement in product range.

Or we could say that the reason why Airbus did so well was because the Euro was weak, allowing them to price more aggressively while maintaining the same level of profitability . The dollar is closer now to the average value for the Euro/ECU dollar exchange rate than it was when it was super strong between 1999-2002.

Quoting Dougloid (Reply 30):
That's only part of the equation, although it has certainly not hurt. I would be really surprised if the contracts for sale do not contain some sort of parity clause to even out the currency exchange rates, or maybe they use a basket of currencies approach. Another thing is that the dollar has declined relative to the Euro....how so against other currencies such as the yen and the Canadian dollar?

The dollar has declined the most against the Euro, but it was only giving up somewhat more than the significant gains it had made since introduction of actual Euro currency at the end of 98. It hasn't declined as much against other countries' currencies partly because those nations' governments take actions to weaken their currencies in order to promote exports.

Quoting BoeingBus (Reply 37):
False, Airbus prices their aircraft in dollars not Euros. Airbus was just fortunate to have currency hedges, like most multinational companies. Value of the dollar had NO effect on sales. As both Airbus and Boeing sell their aircraft in dollars.

Hedges cost money and don't last forever. Even when aircraft are priced in dollars, currency exchange rates will effect the bottom line for manufacturers with significant non dollar costs.

Quoting BlueSky1976 (Reply 41):

Why the hell they haven't ordered 787-3 yet is beyond me...

They seem somewhat concerned about the plethora of LCCs in their neighborhood.
 
jacobin777
Posts: 12262
Joined: Sat Sep 11, 2004 6:29 pm

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 11:30 am

Quoting WhiteHatter (Reply 64):

Grow up, cheerleaders. Boeing is a fat, bloated corporation that needs a dose of reality. Their products are overpriced and manufacturing schemes outdated. The 787 could be the biggest disaster in their history. It has yet to even be assembled, so how the hell can anyone make claims about its superiority or even say it will beat the projections? What if the prototype snaps in half after its first few flights? All possible.

right.....like you have a lot of credibility over near a 100 year old company with some of the most brilliant people in the world.... butthead  sarcastic 

Quoting Thorben (Reply 65):

I agree, this Baseler already claims that the 787 is more fuel-efficient than the A350, although none of the two has flown a single meter yet, leave alone being assembled.

maybe you haven't seen some of th 787s pre-assembled parts already......while the A350 has yet to leave the drawing board...in fact, the plane won't be finalised until 1st Quarter 2006...... spin 

Quoting Stitch (Reply 70):

Possible, but highly unlikely. Scale-model tests and computer testing will all be done long before #001 ever takes to the skies. Plus a number of military planes that Boeing works on, including the B-2A Spirit and the F/A-22 Raptor have extensive composite structures and they don't fall out of the sky at stress levels far beyond what a 787 will ever see. Plus the A380 herself is composed of a great deal of GLARE composites and she seems to sail quite serenely across the blue skies. And if Airbus felt they were unsafe, they wouldn't be using them in the A350 to help get her weight down to maximize her economies, as well.

 thumbsup 

Quoting Morvious (Reply 73):
And I beleve the only reason now that the 777LR is selling poorly is because it is a very expensive plane to buy. There are enough customers for it, but airliners aren't doing great these days.

don't forget, the 777F is based on the -200LR, and that it will sell nicely..I doubt we'll see an A340-based freighter....hence, giving the 777 series much more flexibility..

also, if the -200LR proves to be good at its mission, then expect to see more sales of the plane...
 
ikramerica
Posts: 15174
Joined: Mon May 23, 2005 9:33 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 12:19 pm

Quoting Atmx2000 (Reply 10):
the post 9/11 downturn

That's the main thing (+SARS). All the rest is just talk. Airbus passed Boeing after 9/11/2001. Both companies saw a downturn, but since Boeing holds a larger proportion of the US and Asian airlines, and they were hit hardest for longest during this time, Airbus orders and deliveries passed Boeing. The few new models they had were just a small factor (345/346 haven't sold that well, honestly) Now that things have basically recovered, despite the BKs, and airlines are buying again all over the world but especially in Asia and the US, Boeing is back in the lead.

737 and A320 sales are always going to be the big ones in terms of numbers, and both companies will fluctuate over who leads that area. But Boeing is leading the widebody race by a wide margin and will continue to do so with the 787 and 747Adv.

Quoting DfwRevolution (Reply 13):
If you keep it in perspective, Boeing didn't do too bad.

Keep things in perspective? Here?
 
kaitak744
Topic Author
Posts: 2233
Joined: Fri Jul 22, 2005 1:32 pm

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 12:51 pm

Well, if u think about the aircraft families of A and B,

Airbus selling products:
A320
A350
A380
(A330/A340 are nearly dead)

Boeing selling products:
737
787
777 (-200LR/-300ER)
747ADV

So Boeing has 4 selling products opposed to Airbus's 3. This puts them in the lead I think.
 
manni
Posts: 4049
Joined: Thu Nov 08, 2001 1:48 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 3:21 pm

Quoting Kaitak744 (Reply 86):
Well, if u think about the aircraft families of A and B,

Airbus selling products:
A320
A350
A380
(A330/A340 are nearly dead)

Boeing selling products:
737
787
777 (-200LR/-300ER)
747ADV

So Boeing has 4 selling products opposed to Airbus's 3. This puts them in the lead I think.

The A330/340 line is decleared nearly dead by a group of people here on Airliners.net, in reality however 56 firm orders (32 aren't firmed up yet) for this family of aircraft have been anounced this year versus 46 (31 aren't firmed up yet) aircraft of the 777 family.

The 747ADV hasn't even been launched yet. So Airbus has 4 selling products opposed to Boeing's 3. But what does it matter anyway?
 
astuteman
Posts: 7419
Joined: Mon Jan 24, 2005 7:50 pm

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 4:19 pm

Quoting 777STL (Reply 72):
Needless to say, their costs and the risks associated with such are much lower than Boeing's, and not because they're better managed like you seem to be implying

Not correct - it IS because they're properly managed......

Quoting BlueSky1976 (Reply 80):
Boeing learned a lot from how Airbus is doing their business and they won't make the same mistakes twice. Add to that Y1 and Y3 projects, then you'll have a reinvented manufacturing company with less people on payroll, producing more airframes more efficiently. They just will never in hell admit to the fact, that they learned it from Airbus Industrie.

Absolutely correct - Boeing are quite sensibly taking a good business model and moving it onto the NEXT level again.......
 
Thorben
Posts: 2713
Joined: Fri Sep 09, 2005 10:29 pm

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 4:31 pm

Quoting Kaitak744 (Reply 86):
Airbus selling products:
A320
A350
A380
(A330/A340 are nearly dead)

They are selling enough A330s, believe me. Even with the A350 coming up on the horizon. And despite all the bashing of them, we haven't seen the end to A340NG orders.

Quoting Kaitak744 (Reply 86):
Boeing selling products:
737
787
777 (-200LR/-300ER)
747ADV

The A343 has a bigger backlog than the 747 Adv.

Quoting Kaitak744 (Reply 86):
So Boeing has 4 selling products opposed to Airbus's 3. This puts them in the lead I think.

Leave the thinking to the horses, they have bigger heads.

Quoting Manni (Reply 46):
Boeings real competitor (atleast they tried) to the A332 was the 767-400 wich must have been the worst selling commercial aircraft ever, after the concorde.

Finally, someone takes on the A.net legend, that the A332 would compete with the 763. It really doesn't. The A332 is at least one size larger than the 763, and even a little larger than the 764, which was a complete failure.
 
JetMaster
Posts: 583
Joined: Tue Sep 27, 2005 7:46 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 4:36 pm

Quoting Kaitak744 (Reply 86):
(A330/A340 are nearly dead)

Since when exactly?

Quoting Kaitak744 (Reply 86):
747ADV

Already selling? Since when exactly?


Regards,
JM
 
Shenzhen
Posts: 1666
Joined: Wed Jun 25, 2003 12:11 pm

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 5:29 pm

Just curious, has Airbus ever sold (meaning delivered) a higher dollar value then Boeing in any given year?

Cheers

[Edited 2005-10-13 10:30:21]
 
manni
Posts: 4049
Joined: Thu Nov 08, 2001 1:48 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 6:06 pm

Quoting Shenzhen (Reply 91):
Just curious, has Airbus ever sold (meaning delivered) a higher dollar value then Boeing in any given year?


Last year Airbus delivered 320 aircraft, good for a turnover >20 billion� (19.3 in 2003)
Boeing delivered 285 aircraft generating 21 billion$ revenue (22.4 in 2003)

20 billion� at todays exchange rate is roughly 24 billion$, so they did sell a higher value and with a margin of 14.28%.
 
777STL
Posts: 2770
Joined: Mon Dec 13, 2004 8:22 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 9:10 pm

Quoting Astuteman (Reply 88):
Not correct - it IS because they're properly managed......

Or you know, maybe it's the millions upon millions of dollars of subsidization they receive.....

You can afford to sell airplanes for nothing when you have little vested in them.

In any case, care to tell me why I'm wrong and you're right? Nah, didn't think so....
 
Thorben
Posts: 2713
Joined: Fri Sep 09, 2005 10:29 pm

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 9:16 pm

Quoting 777STL (Reply 93):
Or you know, maybe it's the millions upon millions of dollars of subsidization they receive.....

You can afford to sell airplanes for nothing when you have little vested in them.

Airbus only gets loans, Boeing gets subsidies that they can keep!
 
boeingbus
Posts: 1545
Joined: Sat May 29, 2004 12:37 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 9:44 pm

Quoting Thorben (Reply 94):
Airbus only gets loans, Boeing gets subsidies that they can keep!

I just got a good laugh this morning... THanks! Your funny to think that Airbus ONLY gets loans and NO SUBSIDIES!!!!

Your smoking some good crack in Germany. Honestly, please come back to earth and crack is bad for you... Just look at all infrastructure the EU governments built to just make one place, A380? This is free money for Airbus otherwise there is no way Airbus could fly the A380 w/o runways. Please go back from the A300 till now... and dont lie to me that Airbus only gets loans.

Bopeing is getting tax breaks and they are available to all corperation's. Its not free money it's just they don't pay a tax on the INVESTMENTS they make but they still pay taxes on the earnings. THERE IS A BIG DIFFERENCE. Just look at the tax breaks that the state of Alabama will give to Airbus to build a factory. I guess under your standards, that is OK because Airbus is exempt from your rhetoric? Save it!

Also, I hate the fact that you ALL are picking on Japan for doing the same thing that France and Germany has always done. If the Japanese want to grow and encourage their manufactures to support the aviation sector in their economy.. than let them! The hypocrisy on here!!!
 
Shenzhen
Posts: 1666
Joined: Wed Jun 25, 2003 12:11 pm

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 9:48 pm

Quoting Thorben (Reply 94):
Airbus only gets loans, Boeing gets subsidies that they can keep!

Can you explain how the VAT works for airplanes sold outside of Germany or the EU?

Thanks
 
mrocktor
Posts: 1391
Joined: Mon Jan 24, 2005 12:57 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 10:40 pm

Quoting BoeingBus (Reply 42):
Am I correct?

No. The workings of the launch aid loans have been thoroughly explained over and over. They are not as simple or as favorable to Airbus as you would like to beleive. They remain subsidies nonetheless.

Quoting BoeingBus (Reply 42):
I would love those type of loans. Wouldn't you?

I would rather not pay my income tax. After all, what use is it to a successful person (or industry) to have a benefit they only collect if they are unemployed (or posting losses)?

Quoting Atmx2000 (Reply 83):
Some of the reasons for those lower costs were for reasons out of Boeing's control, such as the exchange Euro-dollar rate.

The exchange rate has heavily favored Boeing in the recent past (cheap dollar).

Quoting 777STL (Reply 93):
In any case, care to tell me why I'm wrong and you're right? Nah, didn't think so....

And you can afford to sell planes for little when you don't have to pay the taxes on them. Stop pretending Boeing is not supported by the government already. Both companies are corporate welfare recipients.

mrocktor
 
Dougloid
Posts: 7248
Joined: Tue Jul 05, 2005 2:44 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 10:55 pm

Quoting Manni (Reply 87):
The A330/340 line is decleared nearly dead by a group of people here on Airliners.net, in reality however 56 firm orders (32 aren't firmed up yet) for this family of aircraft have been anounced this year versus 46 (31 aren't firmed up yet) aircraft of the 777 family.

What's a firm order that isn't firmed up yet? That sounds like being a little bit pregnant.
 
Dougloid
Posts: 7248
Joined: Tue Jul 05, 2005 2:44 am

RE: Boeing's Bad Miscalculations

Thu Oct 13, 2005 11:02 pm

Quoting Atmx2000 (Reply 83):
Quoting JetMaster (Reply 26):

We shouldn't forget one of Airbus' main advantages was lower production costs. Boeing reacted quite late to that.

Some of the reasons for those lower costs were for reasons out of Boeing's control, such as the exchange Euro-dollar rate.

I have no doubt that currency hedges exist in contracts for sale of aircraft yet to be built, whether they are denominated in dollars or euros and whether it's Airbus or Boeing doing the selling.
However, one angle to it that does not respond directly to hedging is the cost of labor-unless one devises a hedging strategy for that as well.
If the dollar declines relative to the euro, Canadian dollar or yen, then the cost of labor for Boeing goes down because they're paying the worker bees in dollars.

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