I see everyone saying how MDC was in bad shape and they had to get bought or go bankrupt.
I wonder about this too. I'd thought the same, but the late-1994 NY Times article I posted said that they were going to spend $2.5 billion on share buybacks, on top of the 71% dividend hike. Would those amounts cover the costs of a clean-sheet aircraft program at the time?
Would the 737 Max and 787 fiascos have happened if there were three big manufacturers instead of two?
They probably don't, although who knows if some other fiascos happen instead.
Would we have a better aviation industry?
For me yes, although just three big airframers isn't what I'd call a healthy marketplace, either. But we wouldn't have two old aluminum designs dominating the skies at the very least, and maybe we'd be on our way to other advancements like truss-braced wings or blended wing bodies.
what decision they should have done in late 80x to survive?
Uninteresting answer, but better execution on the MD-11.
IMO, I think McDD was on the right track in trying to sell propfan derivatives. The aft fuselage mounting of the MD-80/90 seems to be disfavored, but its big advantage over low-wing engine-mounted planes is the ability to add ultra-high bypass engines without having to lengthen the landing gear. They quit in late 1989, but I would've kept at it until an airline bit - even going the try-before-you-buy route that Airbus used with the A300 and Eastern Airlines in the 1970s. If the MD-80/90 family with a propfan option could've held out until the 2000s, McDD would've made big money and marketshare gains selling propfan versions when oil prices started spiking.
After reading up on media reports from that period, I'm still not sure if McDD gave up on its own, or if the engine makers forced its hand. GE/Snecma were doing huge business with the CFM56, so it's understandable why they wouldn't want anything to cannibalize those sales (even though McDD flight tested the GE36 propfan for 240 hours, three times what was originally planned). Pratt & Whitney and Allison also had the 578-DX propfan, though, which was didn't undergo flight testing until April 1989, about 17 months late - and then only for 20 hours before tests ended. Allison didn't have much commercial business at the time, but PW was also a major partner in IAE, which placed the V2500 engine on the MD-90 after the propfan option was dropped. Was it PW or McDD that canceled flight testing when the V2500 family became an option? The V2500 was already on the Airbus A320, so that using engine doesn't help McDD much in comparison. One article said that the 578-DX was PW's fallback option rather than its preferred choice (they also had a couple of high-bypass ducted fan proposals ongoing), so I suspect PW hosed McDD (and Allison, who originated its propfan concept before PW bought in). GE/Snecma were inching away from the GE36 in 1989 -- you'd think that PW/Allison could've had a big opportunity with their 578-DX then, since it had been lagging the GE36 by 12-18 months in development.
Another mystery to me is that Delta made its MD-90 launch order of 50 planes and 110 options only a few weeks after McDD made the V2500 its sole engine option. Delta was one of only a few airlines to have previously bought MD-80 planes with the option to upgrade to propfan versions, though. Was the timing simply a coincidence? If it wasn't, did Delta only buy when it was assured that none of its competitors could buy propfan planes to compete against them?
The fact that Lockheed and Martin, Northrop and Grumman were combined and Lockheed bought F-16 production from General Dynamics doesn't get the same attention here. That all of these mergers consolidations took place at the same time should be instructive.
Thanks, I didn't know that. The question then is why didn't McDD go with Lockheed Martin, Northrop Grumman, General Dynamics, or Rockwell? Then maybe we'd still have a third airframe OEM. Or why the DoJ antitrust division didn't force the commercial division to be sold? Perhaps another company picks up the company for $1 (like BBD) and runs with it...