Boeing CEO: Puget Sound too Expensive for Boeing

[WestSideBilly]

[rose-colored-coolaid]

[WestSideBilly]

[rose-colored-coolaid]

[WestSideBilly]

Speaking more generally, you've hit the crux of the issue. How do middle class* Americans improve their income when the corporations who hire them have a global hiring pool and are competing against workers who can live well off on $5/hr?

Sadly, IAM and its membership is in a no-win situation. Even if they "win" this battle, the long war is not favorable. China's emerging airplane companies, Embraer, Bombardier, etc are all creeping towards the 737/A320 market which are the stable revenue generators for Boeing and EADS. Can a unionized American company or a European consortium based in socialist countries compete against China or Brazil's marketplace and lax corporate/safety rules? I don't see how they could. Some day, IAM and SPEEA will probably be forced to accept lower wages so Boeing can compete with the new players, or else see Boeing go under altogether.






* Whatever definition you may assign to that

[rose-colored-coolaid]

That's an interesting question actually. I think it might not be one that plays out as we expect. When airplanes crash, it is not just big news, but huge news. Let's say you are an airline and you can buy an American or European made plane for 3x the price of a Chinese or Brazilian made plane. None of the other airlines are doing this, so the cost savings would be a huge competitive advantage, but you also don't really have a safety record to look at.

Knowing the cost of a single plane crash, as CEO do you buy the cheaper plane or the known entity? I don't know, but it's not an easy question. Further, how many customers would you lose if people decided that like Chinese baby formula they think Chinese airplanes are unsafe.

I'm not suggesting that growing markets will never break into the market, only that it's a difficult/expensive market to break into. Look at autos. It took Japan about 20 years to really breach the American market, and the risk of a less well made car is lower than that of an airplane. It could take another 30 years for Chinese aircraft to become common.

Meanwhile, I think the wage difference between here and China or Brazil will greatly narrow in the next 20 years. Perhaps, by the time emerging markets are truly competitive, we will be wage competitive again...

Or, everything will be built by robots and all societies will be socialized by necessity.

[Alan]

[Robroy]

Moses Lake.

The old Larsen AFB.

[The Tim]

[WestSideBilly]

I think some of Boeing's customers, or possibly Boeing them self, use Moses Lake's airport to do touch and goes.

I was out there a couple winters ago and a 777 kept circling on an approach path... the guy I was talking to said that was fairly common.

[The Tim]

[rose-colored-coolaid]

[Robroy]

[mukoh]

I can see how boeing can get so tired of the lazy unions that they just theoretically uplift and go to china where there is no unions, they got rid of them a long time ago via a firing squad. US/State would probably give boeing whatever it wants to keep them here though.

On the other hand Boeing has the largest commercial/industrial facility in the whole United States. A lot of the suppliers have followed Boeing's policy of being in the radius of 4 miles of the facility and have moved to Everett. How hard would all of this infrastructure be to replace? And a system that is fully greased and tuned to work? Virtually impossible.

[Robroy]