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Airbus Trounces Boeing .......

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I've just read how Boeing the mightiest giant of American industry has just been trounced by Airbus at the Paris air show (aka Le Bourget). Airbus won orders worth a staggering 72bln Euro while Boeing only won 17bln Euro. This has never happened before and has sent shockwaves around US aerospace.

I can't see a clear rationale for this other than the world is looking carefully at the USA and realizing it's low base interest rate policy has screwed the everyones economies.... to me this looks like backlash. Any industry insiders have a view?

Also, did you all notice how the USA lost the $11bln contract to sell >100 multi-role fighters to India? The USA offered the upgraded F-16 and F-18 while Europe offered the Eurofighter and Rafale. Only the later two are left in the race prompting the USA to accuse India of failing to see the strategic importance of buying their aging F-teens. As a last ditch attempt Lockheed Martin tried to re-enter the race by offering the F-35 Lightning stealth bomber without having sought the agreement of the partner nations (UK, Canada, Oz). It seems they have principles that bend with the way the wind blows.

This news will be lost on most, but the fact is the USA is now facing a serious challenge in defense aerospace. This has not happened since the 1950s. You should all bear in mind the projected cost of the F-35 Lightning and F-22 Raptor programmes is some $2trln..... read that again, two trillion dollars. If Europe gets its' act straight then we could place part of our own defense procurement programmes in Spain, Portugal and Greece (I said part of!) and in doing so rescue their youth from economic depression. Remember - under the UKs pathetic defense strategy our taxpayers will be paying huge sums to the USA for our own defense while at the same time the USA denies their closest partner the software codes needed to ensure the planes are not grounded should the USA use its jamming technology. Wake up.

Frankly, I think its time for France and Germany to stick two fingers up to the UK and call their bluff.

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There was a big thread about Boeing on Off-topic about 2 months ago.

Basically, a few years ago the money men at Boeing decided that they didn't need to build planes anymore - they could just outsource, um, their core business.

Does this story already sound familiar.

They came up with a plane that they could save a fortune on all the brilliant highly-skilled Engineers they employed by firing them, outsourcing all the parts making, just buy in the parts they wanted and then a much smaller staff could put all the bits together.

It totally failed to occur to these money men that Boeing would then be dependent upon their parts suppliers - where a lot of the profit was for Boeing anyhow - and that there was actually little money in the assembly of the parts.

You would think the people at the top of Boeing would understand their own business? Apparently not.

Also, they then also became victim to the problem of different parts from different suppliers not fitting together - they had no direct control over any of this, meetings suddenly became multiple-way meetings between Boeing and various suppliers trying to solve why parts did not or work together. This greatly extended the time-scales, and of course the cost, of building planes.

If you want to lok at a disaster of outsourcing then Boeing is the company to look at.

Personally, I find it disgusting that so few at the top of Boeing understood their own business. Apparently they are now moving everything back in house.

Well, that is what I read. It might all be complete rubbish.

Outsourcing is great for bosses and bankers dependent upon bonuses from firing staff, but usually terrible for the staff, customers and/or service IMPO.

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If Europe gets its' act straight then we could place part of our own defense procurement programmes in Spain, Portugal and Greece (I said part of!) and in doing so rescue their youth from economic depression.

Well, let's hope so. Whether you're against the euro currency or not, it's to no-one's interest to have younger generations in Euro countries denied work. Apart from anything else it ends up with available jobs being taken up in London by foreign youth seeking work, at the expense of local youngsters. We can't complain about the attraction of gang culture in Stratford or Peckham, when we're denying the local youth the prospect of getting work.

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Airbus won orders worth a staggering 72bln Euro while Boeing only won 17bln Euro.

(...)

You should all bear in mind the projected cost of the F-35 Lightning and F-22 Raptor programmes is some $2trln.....

These are indeed staggering numbers. Thanks for posting it bpw.

Do you have a link for it?

Remember - under the UKs pathetic defense strategy our taxpayers will be paying huge sums to the USA for our own defense while at the same time the USA denies their closest partner the software codes needed to ensure the planes are not grounded should the USA use its jamming technology. Wake up.

+ 1

Frankly, I think its time for France and Germany to stick two fingers up to the UK and call their bluff.

I didn't understand this part.

Edited by Tired of Waiting

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There was a big thread about Boeing on Off-topic about 2 months ago.

Basically, a few years ago the money men at Boeing decided that they didn't need to build planes anymore - they could just outsource, um, their core business.

Does this story already sound familiar.

They came up with a plane that they could save a fortune on all the brilliant highly-skilled Engineers they employed by firing them, outsourcing all the parts making, just buy in the parts they wanted and then a much smaller staff could put all the bits together.

It totally failed to occur to these money men that Boeing would then be dependent upon their parts suppliers - where a lot of the profit was for Boeing anyhow - and that there was actually little money in the assembly of the parts.

You would think the people at the top of Boeing would understand their own business? Apparently not.

Also, they then also became victim to the problem of different parts from different suppliers not fitting together - they had no direct control over any of this, meetings suddenly became multiple-way meetings between Boeing and various suppliers trying to solve why parts did not or work together. This greatly extended the time-scales, and of course the cost, of building planes.

If you want to lok at a disaster of outsourcing then Boeing is the company to look at.

Personally, I find it disgusting that so few at the top of Boeing understood their own business. Apparently they are now moving everything back in house.

Well, that is what I read. It might all be complete rubbish.

Outsourcing is great for bosses and bankers dependent upon bonuses from firing staff, but usually terrible for the staff, customers and/or service IMPO.

You have pretty much described the modern Anglo Saxon corporate/capital model and why it is doomed to failure (regardless of the financial woes of the Eurozone).

When you outsource everything you dont really own much more than the brand name.

Edited by stormymonday_2011

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I've just read how Boeing the mightiest giant of American industry has just been trounced by Airbus at the Paris air show (aka Le Bourget). Airbus won orders worth a staggering 72bln Euro while Boeing only won 17bln Euro. This has never happened before and has sent shockwaves around US aerospace.

This has been a long time in coming Airbus have a more up to date line up of aircraft, so typically where boeing have a refreshed aircraft model they will have a new etc.

The big difference was that Airbus launched the 320neo family, a refreshed A320 family and Boeing have been doing nothing because it would cost them more to do an equivalent upgrade to the 737 and can't chose between that and new model to replace the 737 - Rabbit caught in headlights while the 787 problems keep going on and on.

Airbus sold 844 A320neo family aircraft (A320neo A319 neo and A321neo) at the airshow which is record braking.

737 sales were on par with sales of the existing A320 family at <100.

Key message: you only get sales if you have a good product, the days of political deals are dying.

Airlines confidence in Boeing to deliver on a new aircraft is dented after the 787 issues

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This has been a long time in coming Airbus have a more up to date line up of aircraft, so typically where boeing have a refreshed aircraft model they will have a new etc.

The big difference was that Airbus launched the 320neo family, a refreshed A320 family and Boeing have been doing nothing because it would cost them more to do an equivalent upgrade to the 737 and can't chose between that and new model to replace the 737 - Rabbit caught in headlights while the 787 problems keep going on and on.

Airbus sold 844 A320neo family aircraft (A320neo A319 neo and A321neo) at the airshow which is record braking.

737 sales were on par with sales of the existing A320 family at <100.

Key message: you only get sales if you have a good product, the days of political deals are dying.

Airlines confidence in Boeing to deliver on a new aircraft is dented after the 787 issues

I regularly fly both business and personal and find airbus A320 & A330's far more comfortable than the 737 & 777 alternatives. My company operates Embraer 170's and 737's and I would say the Embraer is a better aircraft - from a passenger perspective.

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I think the Paris airshow deals are purely commercial planes so I'll just stick to that.

I don't know about Boeing's outsourcing problems but I'd hazard a guess they didn't win these contracts because they don't have the planes customers want.

I heard one of the big orders for Airbus was a new generation of the A320 that is 15% more fuel efficient (less weight, better engines - an evolution of the current design rather than an all-new one). That's just what the new low-cost airlines in China an India want. Proven technology, but cheaper running costs.

Airbus also has the A380 for long-haul routes which seems to be doing ok, despite the recent engine problems.

Boeing has...? The Dreamliner, which was meant to be their ultra-efficient plane, still isn't flying yet so they've really got nothing much new to sell.

But I think Airbus also has agreements to assemble some planes in China or something, so who knows, that could have swung things as well. I don't know if Boeing have any similar agreements

Edited by efdemin

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There was a big thread about Boeing on Off-topic about 2 months ago.

Basically, a few years ago the money men at Boeing decided that they didn't need to build planes anymore - they could just outsource, um, their core business.

Does this story already sound familiar.

They came up with a plane that they could save a fortune on all the brilliant highly-skilled Engineers they employed by firing them, outsourcing all the parts making, just buy in the parts they wanted and then a much smaller staff could put all the bits together.

It totally failed to occur to these money men that Boeing would then be dependent upon their parts suppliers - where a lot of the profit was for Boeing anyhow - and that there was actually little money in the assembly of the parts.

You would think the people at the top of Boeing would understand their own business? Apparently not.

Also, they then also became victim to the problem of different parts from different suppliers not fitting together - they had no direct control over any of this, meetings suddenly became multiple-way meetings between Boeing and various suppliers trying to solve why parts did not or work together. This greatly extended the time-scales, and of course the cost, of building planes.

If you want to lok at a disaster of outsourcing then Boeing is the company to look at.

Personally, I find it disgusting that so few at the top of Boeing understood their own business. Apparently they are now moving everything back in house.

Well, that is what I read. It might all be complete rubbish.

Outsourcing is great for bosses and bankers dependent upon bonuses from firing staff, but usually terrible for the staff, customers and/or service IMPO.

From memory (about 5 years ago) If you chose your 787 spec right you could order an aircraft where ~84% of the value in the aircraft was created outside the US. Brilliantly destroying long term wealth creation for the US economy.

Edited by koala_bear

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I regularly fly both business and personal and find airbus A320 & A330's far more comfortable than the 737 & 777 alternatives. My company operates Embraer 170's and 737's and I would say the Embraer is a better aircraft - from a passenger perspective.

+1

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Boeing has...? The Dreamliner, which was meant to be their ultra-efficient plane, still isn't flying yet so they've really got nothing much new to sell.

Boeing have thrown away their lead they had with the new 787 over the new A350 too due to all the problems so Airbus is only 18months behind with an even more advanced new aircraft. As the they 350 was original going to launch 5 years after the 787, orders for the 350 were low as most ordered 787 but now you stand a better chance of getting a 350 first...

Hence more orders for the 350 now.

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You have pretty much described the modern Anglo Saxon corporate/capital model and why it is doomed to failure (regardless of the financial woes of the Eurozone).

When you outsource everything you dont really own much more than the brand name.

but where is the anglo-saxon corporate-capital model?

I see precious little evidence of it.....the mega-corps are dictating policy at the expense of small business.

britain,it was once said,was a nation of shopkeepers...but now everything has become too big,clunky and over-regulated in favour of supertanker-size megacorps.

frankly it matters not whether it is an overbearing state sector,megacorps,or omnipotent caesar dictating policy...the old adage remains true.

power corrupts,absolute power corrupts absolutely.

too much power in too few hands.....the central planners need an ass-kicking to make them a bit more humble.(and that does not meen replacing corporatism with communism as marx eluded to)

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(...)

I heard one of the big orders for Airbus was a new generation of the A320 that is 15% more fuel efficient (less weight, better engines - an evolution of the current design rather than an all-new one). That's just what the new low-cost airlines in China an India want. Proven technology, but cheaper running costs.

That makes sense. And it provides cheaper flights for more people.

(...)

Boeing has...? The Dreamliner, which was meant to be their ultra-efficient plane, still isn't flying yet so they've really got nothing much new to sell.

From a passenger perspective, when I first heard that Airbus was going for the double decker, "hub" plane, and Boeing was going for the Dreamliner, a long haul but smaller plane, allowing for more direct flights, I though Boeing had got it right, cause transfers are a pain in the @rse.

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I think the Paris airshow deals are purely commercial planes so I'll just stick to that.

I don't know about Boeing's outsourcing problems but I'd hazard a guess they didn't win these contracts because they don't have the planes customers want.

I heard one of the big orders for Airbus was a new generation of the A320 that is 15% more fuel efficient (less weight, better engines - an evolution of the current design rather than an all-new one). That's just what the new low-cost airlines in China an India want. Proven technology, but cheaper running costs.

Airbus also has the A380 for long-haul routes which seems to be doing ok, despite the recent engine problems.

Boeing has...? The Dreamliner, which was meant to be their ultra-efficient plane, still isn't flying yet so they've really got nothing much new to sell.

But I think Airbus also has agreements to assemble some planes in China or something, so who knows, that could have swung things as well. I don't know if Boeing have any similar agreements

I heard that a lot of the fuel savings was due to a new Pratt and Whitney engine. Apparently Rolls-Royce are being hammered by this too, so it isn't all bad for the US.

I am sure someone knows more about this than I do.

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That makes sense. And it provides cheaper flights for more people.

From a passenger perspective, when I first heard that Airbus was going for the double decker, "hub" plane, and Boeing was going for the Dreamliner, a long haul but smaller plane, allowing for more direct flights, I though Boeing had got it right, cause transfers are a pain in the @rse.

The 787 makes sense for American flying abroad market, less so for other nations markets. The problems was there aren't currently the number of passengers to make the direct routes viable in most countries or the slots available to run smaller (than 747/777) aircraft more frequently to. For example Bristol or Newcastle to Rio is a non starter, you get the train/car/plane to Heathrow and then a bigger aircraft. Boeing assumed and ever growing market with low fuel prices and ever expanding airports. In Europe is was guaranteed not to open up more routes on Long haul.

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I may be stupid but why are these airlines buying all these planes when oil is going to run out before half of them are delivered?

Surely the smart Airline CEO is investing in nuke powered cruise liners.

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I heard that a lot of the fuel savings was due to a new Pratt and Whitney engine. Apparently Rolls-Royce are being hammered by this too, so it isn't all bad for the US.

I am sure someone knows more about this than I do.

A320neo = new engine option, about 80% of saving due to engine.

Rolls don't do engines for either the 737/A320 so can't be hammered...

There will be 2 engine options on the 320 neo

1. Pratt & Whitney (270 planes so far of 1000+ ordered, had all the orders pre show)

2. CFM (GE +Safran) (455 planes so far of 1000+ ordered going from 0 at the a start of the show)

Rolls have 50%+ market share in the larger plane (i.e. bigger than 737/320 size) engine market

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A320neo = new engine option, about 80% of saving due to engine.

Rolls don't do engines for either the 737/A320 so can't be hammered...

There will be 2 engine options on the 320 neo

1. Pratt & Whitney (270 planes so far of 1000+ ordered, had all the orders pre show)

2. CFM (GE +Safran) (455 planes so far of 1000+ ordered going from 0 at the a start of the show)

Rolls have 50%+ market share in the larger plane (i.e. bigger than 737/320 size) engine market

Rolls used to be part of a consortium that supplied the old A320 series, that consortium was CFM (IIRC) have they pulled out for the new engines?

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Rolls used to be part of a consortium that supplied the old A320 series, that consortium was CFM (IIRC) have they pulled out for the new engines?

I was wrong the consortium that Rolls was part of was IAE not CFM.

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Rolls used to be part of a consortium that supplied the old A320 series, that consortium was CFM (IIRC) have they pulled out for the new engines?

RR were nothing to do with CFM; they're a partner in International Aero Engines.

ED: You got there before me!

Edited by yellerkat

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A320neo = new engine option, about 80% of saving due to engine.

Rolls don't do engines for either the 737/A320 so can't be hammered...

There will be 2 engine options on the 320 neo

1. Pratt & Whitney (270 planes so far of 1000+ ordered, had all the orders pre show)

2. CFM (GE +Safran) (455 planes so far of 1000+ ordered going from 0 at the a start of the show)

Rolls have 50%+ market share in the larger plane (i.e. bigger than 737/320 size) engine market

It is a problem I am sure. Airlines will choose this plane because of the fuel saving, at the expense of Rolls-Royce engined planes. Not much good having half of a market no one is buying from. Rolls needs a response here.

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C'mon guys - I thought we were more sceptical on this site...

72bln in orders?? Very good - so how much money has changed hands so far??? Exactly.

Orders are they... or just options to buy dependent on PROVEN fuel efficiency once the plane starts shipping in bulk??

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It's true the press have made excuses for Boeing missing out because of the NEO, but that's only half the story. As pointed out the engines are made in the USA (or should i say bought from?), however, it's pretty unlikely that the worlds second best aircraft manufacturer has been asleep for the past five years while the NEO and new wingtips were being developed by EADS. They knew what Airbus were up to and chose not to 'tweak' their designs. That means they didn't see a major threat to sales. I still think politics is involved and that Asia is rightly putting its considerable weight behind the EU which it has already stated must not fail - that's despite the recent antics of some very large and very corrupt American hedge funds which have sought to cripple Greece in a move designed to weaken the EU. The City Of London were complicit in this too so it was ironic to hear Geither blame the UK for the collapse of Wall St.

BTW - in an earlier post about Airbus I was accused of being a yankophobe and europhile. Only one was correct. I love the USA and the people are mostly great to know and work with - the issue is the obvious need for a strong and economically well managed Union and the great things it can accomplish using the talents of its children.

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You have pretty much described the modern Anglo Saxon corporate/capital model and why it is doomed to failure (regardless of the financial woes of the Eurozone).

When you outsource everything you dont really own much more than the brand name.

Are you sure? To me it looks like the model is working perfectly.

Boeing made a strategic blunder as a result of which their chief competitor gained an advantage; the management at Boeing are aware of the blunder and are taking steps to correct it.

Mistakes happen in every business, it's how you deal with them that is important.

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  • 285 Brexit, House prices and Summer 2020

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