[HN Gopher] Boeing cutting more than 12,000 U.S. jobs with thous...
___________________________________________________________________
Boeing cutting more than 12,000 U.S. jobs with thousands more
planned
Author : hhs
Score : 481 points
Date : 2020-05-27 15:36 UTC (7 hours ago)
(HTM) web link (www.reuters.com)
(TXT) w3m dump (www.reuters.com)
| totaldude87 wrote:
| May 7th: Boeing has raised $25 billion in a massive debt sale,
| allowing it to avoid tapping a $17 billion coronavirus bailout
| fund meant to shore up businesses critical to national security.
|
| https://metroairportnews.com/boeing-passes-on-accepting-fede...
|
| [edit]
|
| "That stance concerned lawmakers from Washington state, who urged
| Calhoun in a letter to "consider utilizing the economic
| assistance provided by the Cares Act to safeguard thousands of
| jobs at Boeing in Washington State and across the country.""
|
| These corporate only care about bottom line
| aluminussoma wrote:
| A lot of Boeing's current dilemma is the failure of executive
| management. A commonly written story is that the competent
| executives at Boeing, who were focused on solid engineering, were
| pushed aside by the political McDonnell Douglas executives.
|
| McDonnell Douglas was purchased almost 25 years ago, so perhaps
| it may be a little unfair to ascribe all of Boeing's current
| problems to that one event. Still, as an engineer, I can't help
| but notice executive management operate in similar politically-
| bent ways at some tech companies I've worked at.
| subzidion wrote:
| "McDonnell Douglas bought Boeing with Boeing's money" as the
| saying goes...
| Analemma_ wrote:
| > McDonnell Douglas was purchased almost 25 years ago, so
| perhaps it may be a little unfair to ascribe all of Boeing's
| current problems to that one event.
|
| Planes have a very long development cycle. If the foundations
| at Boeing started rotting on the day of the McDonnell-Douglas
| acquisition, it makes sense that we'd only start seeing it fall
| apart now.
| tjohns wrote:
| I'm curious if this impacted the Foreflight development team,
| since they were recently acquired by Boeing.
|
| I'm really hoping not, since Foreflight is my favorite app for
| aviation and up until now has been doing a great job of adding
| new functionality.
| ccostes wrote:
| Totally forgot that Boeing owned them. They have been on fire
| lately with all the new features and I hope this doesn't impact
| them.
| euix wrote:
| What's going to happen to all the highly skilled and specialized
| labor of building aircrafts? Where would they go? I wonder if we
| won't see a situation like the early 90's when suddenly all the
| top scientific and engineering talent of the USSR migrated to the
| US looking for work. If China was smart they would try to poach
| as many of these guys as possible. Layoff the propaganda and pay
| the top guys well. You could be looking at massive knowledge
| transfer in the years to come.
|
| Securing IP and existing tech within borders is much easier then
| preventing people from moving around.
| MattGaiser wrote:
| Aviation is going to be the last thing to recover so this is
| unsurprising. I could easily see it being years before new
| aircraft are ordered as there are just so many parked right now.
| misiti3780 wrote:
| hopefully flights will be cheaper too, but i doubt that will
| happen.
| kube-system wrote:
| You get low ticket prices when the air is full of big
| efficient planes, consistently full of passengers, being used
| around the clock, in competition with many other airlines.
|
| We should expect an increase in ticket prices over the coming
| years.
| MattGaiser wrote:
| No they wouldn't as the only people who are flying are going
| to be those who need to fly, not those who decided to hop
| down to Mexico for a week as it was cheap.
| nostromo wrote:
| Flights will get more expensive as there will be less
| competition after the shakeout.
|
| The same thing happened after 9/11: fewer carriers, fewer
| options, and higher prices.
| mark-r wrote:
| For the short term they are definitely cheaper, the airlines
| are desperate to get people back in the habit of flying. My
| son is going to a camp halfway across the country later this
| summer, and their original plan was to take a train. After
| checking the plane fares a couple of weeks ago they changed
| their mind and are going to fly.
| Avalaxy wrote:
| Even cheaper?! If anything I think prices should be tripled.
| It's ridiculous how cheap it is to fly nowadays. Often
| cheaper than way more environmentally friendly ways of
| travelling.
| KptMarchewa wrote:
| First of all, they should be seriously taxed. It's
| ridiculous that air fuel is untaxed.
| kyuudou wrote:
| Isn't jet fuel basically kerosene.
| dannyw wrote:
| Have you checked the breakdown of a ticket lately? Taxes
| accounted for 45% of my Sydney to San Francisco ticket.
| SpicyLemonZest wrote:
| I unfortunately think that flights are likely to end up at a
| more expensive equilibrium. There'll be a lot less pressure
| to cut costs and a bit more pressure to improve the
| experience, now that all the lifestyles revolving around
| regular air travel have been disrupted.
| rrmm wrote:
| And Boeing wasn't really on a winning streak going into all
| this.
| nickff wrote:
| In some ways, this may have taken some pressure off them, and
| given them some time to catch up, though it seems likely this
| recession will just hurt Boeing less than Airbus (as the
| latter was in a better sales position going in).
| wongarsu wrote:
| An Aircraft's lifetime is mostly determined by how often it
| starts, because of the stress of going to low-pressure high-
| altitude and back. All these aircraft not flying will seriously
| cut the rate of new orders even in the months after airlines
| recovered.
| mcv wrote:
| I feel sorry for the people who lose their jobs because of
| this, but I think less air travel would in many ways be a good
| thing for the world.
| kyuudou wrote:
| Less military activity, air and otherwise, would be
| exponentially more effective. No one wants to kill their
| golden goose, though.
| fermienrico wrote:
| Agreed. Furthermore, traveling is overrated - yes I said
| that. Traveling to other places IMP is not as fun as going to
| national parks and exploring nature right here at home. Just
| my personal take on it - I've travelled extensively and I
| don't enjoy it anymore.
| vmception wrote:
| Yeah not all of us travel to compare national parks and
| nature. Bird watching in the Aleutian Islands would be a
| drag for most of us.
|
| On the other hand, events with friends, lovers, annual
| festivals (yacht weeks, film festivals, music festivals),
| getting immersed somewhere else so long that you take
| classes and go about the day to day with others in the
| class, actually enjoying taking cross country trains
| because they are a fast and viable form of transportation.
| Can't wait till that is viable again! Many of those things
| are possible in the US, many of the events are just not in
| the US and their original locations are better for it,
| there are also lots of people not interested or capable of
| coming here, who I like to be around.
| [deleted]
| hyperbovine wrote:
| > I've travelled extensively and I don't enjoy it anymore.
|
| But that's because there are so many other travelers.
| Conditional on survival, travel is looking more appealing
| post-COVID.
| postsantum wrote:
| From my expericence, there are not that many places that
| you can't have all to yourself if you really want it
| ch4s3 wrote:
| So because you don't enjoy ANYMORE, other people shouldn't
| be able to enjoy in the first place?
| fermienrico wrote:
| Yeah, I thought we are expressing our opinions on this
| site?
| ch4s3 wrote:
| You are of course free to, but I think your opinion has
| an air of elitism and condescension, so I'm expression my
| own opinion to criticize it.
| fermienrico wrote:
| How so? Please read the comment again. Where is the exact
| wording that made you feel that way? I can correct it.
| ch4s3 wrote:
| You were agreeing with the statement "I feel sorry for
| the people who lose their jobs because of this, but I
| think less air travel would in many ways be a good thing
| for the world. ".
|
| That necessarily implies that fewer people should be able
| to travel.
| ch4s3 wrote:
| > but I think less air travel would in many ways be a good
| thing for the world.
|
| This seems overly myopic to me. Aviation accounts for at most
| 2% of global juman CO2 emissions during normal years. I think
| you could come up with dozens of arguments for why it's a net
| good. For example, tourism has income allows small island
| nations to better financially prepare for rising sea levels
| far in excess of aviations contribution to sea level rise.
| Not only that, but travel exposes citizens of wealthy nations
| to the real living conditions of people in developing
| nations, which can have a number of positive political
| effects.
| blululu wrote:
| 2% of CO2 emissions is a lot when you consider the number
| of people who produce it. For anyone who flies regularly it
| will typically make up the lion's share of their carbon
| footprint.
| ch4s3 wrote:
| If you see my other comment, for most travelers in the US
| at least who make a single large trip every year or so
| the single trip makes up less than 10% of their emissions
| for that year.
| leetcrew wrote:
| 2% is not negligible. that's about a fourth the emissions
| share of cars, which are much more essential to daily life
| where they are used. we don't have the emissions budget for
| any sacred cows; we need to see a big cut from every source
| of CO2.
|
| the arguments you gave are not that compelling. air travel
| doesn't need to disappear entirely, but the environment
| would benefit from having it be a good bit more expensive.
| part of this could be increased airport fees to help the
| island nations recoup some of the revenue.
|
| > Not only that, but travel exposes citizens of wealthy
| nations to the real living conditions of people in
| developing nations, which can have a number of positive
| political effects.
|
| maybe so, but I doubt you could measure this with enough
| confidence to use as a basis for policy.
| ch4s3 wrote:
| I'm arguing against the idea that a decrease in aviation
| is on balance good, and I was trying to avoid just making
| the economic argument.
|
| However, there are tons of economies that rely on tourism
| to function. There is no clear way to make up for that in
| the short to medium term. It's generally agreed that
| economies need to decarbonize energy production ASAP, and
| that takes money which has to come from somewhere. For
| many economies less air travel directly means a
| diminished ability to decarbonize energy.
|
| Now let's turn our focus to the nations that originate
| the travel in question. These places generate a lot of
| economic activity from travel as well. Now laid off
| employees of Boeing do not pay income taxes, and use
| public money in the from of unemployment services. If
| they were still employed their taxes could go to any
| number fo climate initiatives, their pay checks could
| purchase more efficient vehicles, and they could retrofit
| their homes.
|
| Diminished economic activity doesn't position any nation
| to take active measures towards climate change
| mitigation.
| adrianN wrote:
| Aviation has a relatively low percentage of total emissions
| only because globally almost nobody can afford to fly. For
| a rich person like you and me, a transatlantic trip is a
| good way of doubling your emissions for the year.
| ch4s3 wrote:
| A transatlantic flight of 6 hours on a Boeing 737 would
| emit about 540 kilograms for a single passenger. In the
| US per capita C02 emissions were 15.8 metric tons in
| 2017. So the round trip would account for ~1/15th of a
| person's yearly total.
|
| You could probably make that up by driving less, since a
| typical passenger vehicle emits about 4.6 metric tons of
| carbon dioxide per year. If you look at the UK, it's
| estimated that 20% of the nation's emissions are directly
| from heating and hot water, which is analogous to many
| areas of the US. This is largely due to old and poorly
| insulated housing stock.
|
| This isn't meant to be CO2 whataboutism, but rather to
| compare meaningful individual contributions to emissions.
| IMO aviation for most international travelers may be a
| large single contribution, but they do it infrequently
| and other activities could be moderated of modified to
| make up ground. I mention this to support my parent claim
| that aviation has numerous benefits, and they may likely
| outweigh their costs accounting for externalities. That
| said, I would advocate a carbon tax that prices emissions
| into things like gas, heating, flying, etc.
| wott wrote:
| > In the US per capita C02 emissions were 15.8 metric
| tons in 2017.
|
| What about taking a normal person and not an American?
| Even compared to other developed, Western-type nations,
| the US emissions are terribly high (only matched by the
| other 2 large Anglo-Saxon colonies); but triple of UK and
| France per capita emissions. And those 2 are already over
| the emission budget.
| makerofspoons wrote:
| 1/15th of a yearly total that is far, far too large. A
| sustainable value is 3 tons of CO2 per year
| (https://www.ecocivilization.info/three-tons-carbon-
| dioxide-p...). Now that transatlantic flight is 1/5 a
| person's yearly total which also has to include the
| emissions for their heating, water, food, and transport
| which is just not feasible in western countries today.
| fsflover wrote:
| This is not how you should look at your CO2 emissions.
| You should look at where you can deccrease them first:
|
| http://www.kimnicholas.com/uploads/2/5/7/6/25766487/fig1f
| ull...
| mcv wrote:
| Nice infographic. I'm sad to say I moved in the wrong
| direction on a few of these: I used to be car-free and
| vegetarian. Now that I have a family, I'm neither. Then
| again, I did get two fewer children than I actually
| wanted.
| ch4s3 wrote:
| To reply to makersofspoons the blog post cited sources
| the 3 ton figure from a 2011 UN report. The report only
| mentions the figure in the summary and states "3 tons of
| carbon dioxide (CO2) emissions per capita by 2050 MAY
| need to be considered". This seems a little thin for
| advocating the eradication of aviation in 2020.
| makerofspoons wrote:
| It's in line with the 2019 IPCC report, which called for
| an 80% reduction by 2050 https://grist.org/article/how-
| soon-do-we-need-to-cut-greenho...
|
| There's really no budget for burning kerosene if we are
| serious about the 1.5 degree target. The only way I see
| aviation being compatible is if there is a massive
| breakthrough in biofuels or battery technology.
| ch4s3 wrote:
| That article doesn't directly cite any IPCC report. This
| actual IPCC policy maker summary report[1] makes exactly
| 1 mention of air travel and it is to suggest structurally
| shifting some air travel to rail as a minor component of
| improving total transit emissions.
|
| [1]https://www.ipcc.ch/site/assets/uploads/sites/2/2019/0
| 2/SR15...
| makerofspoons wrote:
| You're right, I cited the wrong article. The summary does
| mention air travel only once, but it does mention the 80%
| reduction figure, which seems nearly incompatible with
| air travel if everyone is expected to live with yearly
| emissions of ~3-4 tons of CO2.
| sodafountan wrote:
| Yeah that's not how it works, people losing their jobs and
| others being unable/unwilling to experience the world and
| travel is a very bad thing for the world.
| toomuchtodo wrote:
| There are other jobs, and I would like to see objective
| evidence that those wealthy enough to fly international
| derive more value from "cultural experiences" than not
| putting those metric tons of CO2 into the atmosphere.
| sodafountan wrote:
| Yeah that's very "woke" of you for saying that but
| there's really no positive way to spin this. When a
| pilot, or flight attendant, or engineer has to retrain
| and possibly leave an industry they've worked in
| potentially their entire life that causes pain and
| suffering.
|
| It doesn't surprise me that the HN crowd lacks the
| empathy to see the damage being done here, but say for
| instance someone told you couldn't code anymore, you lose
| your job, and you might have to pivot into another
| industry at a time when nobody's hiring and you don't
| even have the skills or training to get in the door. Then
| some pompous asshole online says "well ackchually this is
| good for the environment because computers consume energy
| and don't run off of the hot air I blow everytime I open
| my mouth"
| mcv wrote:
| I think many here do have empathy with the people
| involved. I certainly do. But we also see the bigger
| picture.
|
| Every industry that dies or suffers a setback is a
| tragedy, but it's also the unavoidable result of
| progress, of capitalism, and of any sort of active
| economic activity.
|
| And the people involved can be taken care of. There
| doesn't need to be pain an suffering unless society
| decides that people who lose their jobs because of
| something like this need to suffer.
|
| And for the record, a close friend of mine did indeed
| lose the ability to code. He dropped out of his PhD and
| become a shop security guard for 7 years. Not exactly his
| dream job, but he accepted it and it worked out. There
| are millions, probably billions, of people in the world
| who don't get to work their dream job. Pilots and flight
| attendants aren't the only ones. I'm all for helping
| them.
|
| None of that changes the fact that excessive air travel
| does a lot of damage.
| toomuchtodo wrote:
| Please don't conflate being realistic with being "woke".
| It sucks you've lost your job. Retrain or retire. I'm not
| without empathy, but America has chosen the lack of
| safety nets it exhibits. And I can appreciate the
| environmental benefits from the pandemic that we couldn't
| do ourselves as a species.
|
| I would be a _huge_ fan of Medicare for All and more
| robust safety nets resulting from this carnage, but I don
| 't expect it. People are irrational and selfish in
| aggregate, and when times are good they are entirely
| apathetic to the political process. Only under duress do
| they scream "do something" to the people they've elected
| who actively do harm to their constituents' interests.
| sodafountan wrote:
| you're either extremely young or a sociopath, I sincerely
| hope it's the former. Describing a lifetime of commitment
| to one's career as "sucks you lost your job" demonstrates
| an extreme lack of empathy, which ironically makes YOU
| selfish in aggregate.
| toomuchtodo wrote:
| Propose an alternative solution to a sudden destruction
| in demand for these roles. This is why your job is not
| who you are, but merely a means by which you support
| yourself. I apologize if your life path has lead you to
| where your identity is your work. I never said we
| shouldn't take care of these people. They deserve a
| similar quality of life, even if their role no longer
| exists, and I apologize if that wasn't made clear by my
| comments. To be clear: _We absolutely should take care of
| people collectively whose roles have evaporated._
|
| I am not willing to have communal tax dollars to pay
| pilots, aircraft lease payments, and fuel for unneeded
| air travel capacity, or workers to build planes that'll
| never fly, and I don't think that's unreasonable. I would
| be totally fine taking those tax dollars and putting
| those folks on Social Security early (or whatever safety
| net is going to keep them comfortable). Take that safety
| to go find new work you enjoy. Or go fish. Or woodwork.
| Or spend time with loved ones.
| qorrect wrote:
| Woodwork. It's woodwork.
| jlongr wrote:
| You're being needlessly dismissive and combative, and
| calling an individual selfish "in aggregate" doesn't even
| make sense.
| markrages wrote:
| From article:
|
| > The company announced in April it would cut 10% of its
| worldwide workforce of 160,000 by the end of 2020.
|
| From boeing.com:
|
| > The company employs approximately 145,000 employees across the
| United States and in more than 65 countries.
|
| 90% of 160 is 144. The math checks out.
| hhs wrote:
| That Boeing website you note may be referencing old data. Based
| on their 2019 annual report, on page 18 under item 6, Boeing
| cites that they had a year-end workforce of 161,100 employees.
| The annual report is available here:
| https://investors.boeing.com/investors/financial-reports/def...
|
| So, the article is roughly correct.
| marcus_holmes wrote:
| This is what happens when you let the accountants run the
| business.
|
| First the research goes. Then the product engineering drops. Then
| there's mass layoffs. Then the whole thing falls apart.
|
| To an accountant, a drop in costs is as valuable to the business
| as a rise in revenue. To everyone else, this is obviously not
| true. Risking future profits to cut current costs is a great move
| according to an accountant. For everyone else, it's corporate
| suicide.
|
| Edit: I realise COVID. But that's the excuse, not the reason.
| [deleted]
| TimSchumann wrote:
| As someone who lives in Seattle, and has several friends
| working for Boeing (I think still?), this comment hits the nail
| on the head.
| asperous wrote:
| Based on the article it sounds like a lot of these are line
| staff and support staff which is a direct result of a decline
| in the number of orders. Unfortunately I think there's not much
| they can realistically do about that.
|
| The sudden shift in staffing comes from the sudden shift in
| demand.
| Avicebron wrote:
| I find it amazing how much good companies will sacrifice for a
| good quarter or so of "growth". Great R&D can be unprofitable
| for a long time until it's suddenly Bell Labs. That doesn't
| happen without some infrastructure, but an accountant rocks up
| and suddenly the company is a husk, time and time again.
| CreRecombinase wrote:
| Even Bell Labs wasn't suddenly Bell Labs though. Even when
| Bell Labs was "Bell Labs", was it ever profitable for those
| who were footing the bill (as opposed to society at large,
| which it obviously was)?
| Ericson2314 wrote:
| Bell labs was good _precisely_ because I doubt it ever made
| anyone much money. Hmmmm.....
| wwright wrote:
| Someone could make some good money by explaining how this
| squares with the conventional wisdom that optimizing for
| profit also optimizes for the good of mankind.
| jfk13 wrote:
| That's "conventional wisdom"? It sounds like a pretty
| implausible proposition to me.
| spamizbad wrote:
| Wasn't Bell Labs funded by a tax/surcharge on people's
| phone bills? I believe there was some restrictions on
| commercializing its developments as well. It could do
| research, create things for internal use at AT&T, but not
| traditional product development.
| Ididntdothis wrote:
| Almost nobody who has a say has any incentive to think long
| term. For a CEO the next few years are important,
| shareholders can jump ship anytime. It's a total alienation
| of somebody's actions from the long term consequences.
| bluGill wrote:
| Most shareholders are in it for the long term. They can
| dump Boeing, but only by putting money into something they
| think will do better. They won't put the money in a
| mattress or such.
|
| Most shares belong to 401k retirement accounts of the
| middle class.
| Ididntdothis wrote:
| 401k owners generally have no say due to low number of
| shares. And most likely they are not in a position to
| make a judgement of the decision a management makes.
|
| Who is looking out for them? Not the CEO and I don't
| think the board either. You need to have a lot of shares
| before you have an influence.
| sokoloff wrote:
| ISS[0], Vanguard, and other fund families absolutely have
| massive say (powered by those 401k balances) over
| corporate conduct.
|
| [0] - https://www.issgovernance.com
| mopsi wrote:
| Their corporate governance teams are surprisingly small.
| Vanguard has only something like 35 people overseeing
| thousands of companies and voting on hundreds of
| thousands proposals each year.
|
| As a result, some of that voting is running - literally -
| on autopilot, see
| https://www.issgovernance.com/solutions/proxy-voting-
| service... and
| https://corpgov.law.harvard.edu/2018/11/29/the-realities-
| of-...
| sokoloff wrote:
| The _entire point_ of having ISS (or Glass Lewis) advise
| on voting and offer options like autopilot is to give the
| collective power of all those tiny 401K balances to a
| single unifying entity who can help drive shareholder-
| friendly terms (or at least provide a partial balance to
| what might otherwise become too boardroom-friendly
| terms). I view that the voting is on autopilot as a
| potentially positive control not the negative that you
| seem to believe it to be.
|
| Some fund companies commit to following ISS advice across
| the board or on certain topics. Others like Vanguard
| delegate the voting power to fund managers (who have
| _access to_ ISS reports but aren 't obliged to follow it
| slavishly).
| mopsi wrote:
| My point was that Vanguard et al have massive power, but
| they are not using it, e.g.
| https://www.reuters.com/article/us-usa-funds-index-
| specialre...
| ryanwaggoner wrote:
| You don't need a vote to sell your shares and drive the
| stock price down, which executives absolutely do care
| about.
| taway902101 wrote:
| Here is the software engineering equivalent:
|
| - golf buddy convinces CEO of well-run software shop: your
| company is way too inefficient "your per-employee ratios are
| off the charts low!"
|
| - golf buddy gets hired as Chief Strategy Officer, hires a
| bunch of high paid underlings
|
| - they decide the freeze wages, reduces bonuses, reduces
| benefits for software engineers. Lots of savings to show!
| (unless you also count inflated salaries of new management)
|
| - Software engineers demoralized, best ones move on to better
| jobs, adverse selection, more demoralization
|
| - Golf buddy hires more project managers -- because obviously
| the answer to underpaid SWEs is to hire more managers. Beatings
| will continue until morale improves.
|
| - Now the company really does have bad metrics. Decisions are
| made to offshore half the staff -- save 30%, but increase work
| for onshore staff. Offshore staff is great, but at a
| disadvantage due to distance and not having context/proximity
| to business.
|
| - Golf buddy hires product managers to better define specs,
| more project managers to produce more reports.
|
| - Gold buddy, his friends, ride off with their big paychecks to
| spoil the next company
| ksk wrote:
| Your crude caricature relies on the existing CEO, and the
| board, to be incompetent and easily swayed by bogus numbers.
| If they were indeed incompetent, its not exactly a shock if
| the company implodes then is it?
| specialist wrote:
| Innovative CEO, a sales centric MBA who's never written a
| line of code, now overseeing acquired software company,
| imposes the golf buddy's investor pleasing "blended shore"
| model, the outsourcing of core knowledge work to noobs
| coupled with shipping the actual skilled labor to lowest cost
| locales, against the advice of everyone who's ever
| successfully shipped software, who are all now branded
| "seditious", and managed out of the company they built up
| from zero.
|
| Been there, been done like that.
| type-2 wrote:
| How many accountants are making these executive decisions?
| corebit wrote:
| The CEO of Boeing graduated with an accounting degree. He is
| literally an accountant.
| missedthecue wrote:
| He was appointed just a number of weeks ago. The CEO for
| the past number of years was an engineer by trade.
| vel0city wrote:
| The current CEO was appointed in January. It is currently
| the end of May. I guess we could still count that in
| weeks, but most would use months at this point.
| thrower123 wrote:
| What do you do when two of your biggest products flop as badly
| as the 737-MAX and the 787 have?
| marcus_holmes wrote:
| Hire more engineers and let them make decisions
| ksj2114 wrote:
| I've worked on many cost cutting projects in the past, in
| consulting and private equity where cost-cutting was the norm.
| These statements very easy to say in retrospect.
|
| Many studies show that private equity owned companies, which
| typically run businesses the leanest, actually perform better.
| download13 wrote:
| stfu parasite
| chucksmash wrote:
| For which measure of better?
| burkaman wrote:
| Can you link to any of those studies?
| ksj2114 wrote:
| This is one of the most comprehensive studies:
| https://bfi.uchicago.edu/wp-
| content/uploads/BFI_WP_2019122.p...
| burkaman wrote:
| Yeah, that's the only one I could find. I definitely
| don't have the background to understand the whole paper,
| but it doesn't seem to paint a very positive picture. If
| you cut employment by 13% and grow labor productivity
| (output per employee) by 8%, aren't you worse off? At
| best, you're producing the same amount while benefiting
| society less and the owners more.
|
| Also:
|
| >Public-to-private buyouts involve greater leverage and
| bankruptcy risk but few advantages in financial returns,
| at least in recent decades. Private-to-private buyouts
| appear more likely to create value by relaxing financial
| constraints and improving management practices.
|
| Public-to-private buyouts are generally the ones people
| get angry about, and it seems that they're economically
| bad in addition to the social consequences. I don't think
| people generally object to one private equity firm buying
| from another.
| pascalxus wrote:
| i think the boeing executives are better equiped to measure
| future demand. i'm sure they wouldn't be cutting costs unless
| they knew there would be future decline in demand.
| sushshshsh wrote:
| Tell that to Amazon? Frugality is one of the top principles of
| the company.
|
| Do more with less, learn how to solve hard problems so you
| don't have to pay other people who maybe won't actually fix
| those problems.
| gamblor956 wrote:
| _This is what happens when you let the accountants run the
| business._
|
| This is so completely not true. Worked with the Finance Dept
| heavily at my last job. The accountants keep track of the
| expenses, and make sure everyone is sticking to the
| budgets...but the accountants don't make the budgets.
| Management does. The accountants are the ones making sure that
| the company can actually pay for everything.
|
| _To an accountant, a drop in costs is as valuable to the
| business as a rise in revenue._
|
| This is also false. To an accountant, a drop in costs is
| literally the exact opposite of a rise in revenue. (For
| comparison, it would be like saying that to a software
| developer having a more powerful computer is the same as
| writing your software to be more efficient.) A drop in costs is
| only valuable to the accounting team if there's not enough
| money to pay for everything, because then the drop in costs
| makes it possible to pay for more of the bills that the rest of
| the company incurs. The Finance Dept would absolutely prefer to
| see more revenue over a drop in costs, because revenue is
| repeatable and sustainable, while reducing costs is not.
|
| Management are the folks that only cares about the bottom line
| regardless of how it's reached.
|
| Blame management.
| ihumanable wrote:
| I don't disagree with the main point you are making, but I
| would consider this argument to be a bit weak "For
| comparison, it would be like saying that to a software
| developer having a more powerful computer is the same as
| writing your software to be more efficient."
|
| There's a lot of companies out there that just throw some
| more hardware at a problem.
| icedchai wrote:
| Yep. When you're at a growth company that enters cost
| reduction mode, it's a good time to start looking for another
| opportunity. "Why is AWS going up? Get that cloud bill down.
| Do you really need all these monitoring services? Cancel
| them." They should be focusing on _revenue_ , like you said.
| pm90 wrote:
| > Blame management.
|
| By "blame accountants" the OP was referring to management
| being accountants. Nobody sincerely believes that accountants
| have the power to do layoffs, but managements that were
| previously accountants won't see the long term destruction in
| value, only the short term profits.
| bobthepanda wrote:
| There is a world of difference between accountants, and the
| MBAs who are running the show.
| nightski wrote:
| If anyone understands the concept of investment, it is
| someone in finance. To claim they only care about cutting
| costs maximizing revenue today at the expense of the future
| is ridiculous.
| pm90 wrote:
| People in finance don't really understand or care about
| engineering R&D and long term investment in engineering
| culture, possibly because the effects of these things
| haven't been quantified scientifically. It's simply
| another line item. They do acutely understand the effects
| of numbers on their stock compensation though.
| chasd00 wrote:
| and people in engineering R&D and "engineering culture"
| (whatever that means) are completed disconnected from
| reality when it comes to making payroll. And i say this
| as a software engineer myself.
| pm90 wrote:
| Im not sure what your point is except to state a contrary
| position. Try to contribute better next time.
| missedthecue wrote:
| The typical techbro understanding of corporate finance is
| shockingly shallow
| marcus_holmes wrote:
| the typical accountant's understanding of technology and
| product development _even if they 're in a company that
| does that_ is shockingly shallow
| abduhl wrote:
| An amazingly uninsightful truism: people have a shallow
| understanding of topics that they are not intimately
| familiar with.
|
| Perhaps this is why accountants and MBA types run
| businesses and software devs continue to just develop
| software for their bosses. You know, the ones who
| understand business more deeply. Because that's what they
| do. To misappropriate Sorkin: if software devs are so
| fucking smart, how come they lose so goddamn always?
| moosey wrote:
| I don't blame anyone. I want the world to evolve into one
| where our society puts human welfare first. Blaming does not
| help that happen at all.
|
| It is easy to get caught in a trap thinking heavily about
| money. When thinking about things we own, the emotion and
| fear centers are aroused far more than when we think about
| other people. To avoid this, I believe our society must be
| trained away from neoliberal and 'greed is good' thought.
|
| Blaming people for this state of events, or the addictive
| qualities of facebook, or the dangerous misinformation spread
| designed to take advantage of cognitive flaws of the human
| mind - these practices will get us nowhere. One thing that
| businesses started doing right was the blameless postmortem.
|
| Find the problem, fix it. Move on.
| brundolf wrote:
| I think it would be more accurate to say this is what happens
| when you let the shareholders who are too far removed from the
| business itself run the business. Those are the people who'd
| like a company to be a simple growing-asset in their portfolio,
| who specifically don't want to be bothered with its nuances or
| long-term health, and who have the leverage to impose their
| ill-informed will on everyone else.
|
| I have a pet theory that a large portion of the decay in our
| society can be traced back to the layers of abstraction between
| stakeholders and the things (and people) they have power over.
| Usually this kind of thing doesn't happen before a company has
| gone public.
| michaelt wrote:
| If you're interested in corporate governance, you might enjoy
| reading the book "Pay without performance"
|
| One of the points it makes is that shareholders have very
| little power in practice, as even if you own a million
| dollars of Apple shares, that's only 0.00007% of the company.
| Not exactly enough to force through a motion on your own.
|
| And if you think you'll build up a coalition to get a
| majority? Good luck doing that when you can't even find out
| the names of other shareholders.
|
| Minority shareholder lawsuits? They're actually a negligible
| force; rare, unlikely to succeed, and low impact even when
| they do.
|
| And that's without getting into 'preference shares' that
| grant CEOs outsized voting rights.
|
| The book argues management can neglect shareholders'
| interests with impunity for these reasons.
| brundolf wrote:
| Well there are two kinds of public shareholders, right.
| There may be a small number who own large enough shares to
| bother attending board meetings and voting, and then there
| are the millions with pensions, 401ks, index funds, etc. I
| think you're talking about the latter, who have the same
| issue but a slightly different version of it. In their
| case, the "ill-informed management" comes down to "price
| goes up, buy, price goes down, sell". Through share price
| they wield an extremely blunt version of the same weapon.
|
| This is almost worse, because it very explicitly cares only
| about the short-term price. It's also a much harder problem
| to solve, because you can't just tell those people "think
| long-term and ethically when you're exercising your impact
| on the marketplace!". No matter how ethical they may be as
| individuals, most of them probably don't even know _which_
| companies they have stakes in, much less whether those
| companies are heading in the right direction!
| WalterBright wrote:
| > it very explicitly cares only about the short-term
| price.
|
| There is no short term price in stocks. Stocks are valued
| at their perceived long term value. If shareholders
| suspect a company is sacrificing the long term for the
| short term, they're going to dump the stock until the
| price of it drops to reflect that.
|
| This also implies that if you can reliably detect that a
| company is eating its seed corn before everyone else
| does, you can make a mint shorting it.
| prewett wrote:
| > There is no short term price in stocks. Stocks are
| valued at their perceived long term value.
|
| Hogwash. Pretty much every company on the S&P 500 dropped
| 30% around March. Did their perceived long-term value
| change 30%? I doubt it. I think most people were fully
| aware that most companies in the S&P's 10 year value
| wasn't going to change much; certainly not 30%. Yet, it
| dropped 30%. And then the next month it has risen back up
| to about 10% of its all-time high. I don't think people
| seriously thought that Apple, Coca-Cola, Pepsi, etc.
| suddenly dropped in value 30% and then suddenly rose 20%
| (yes, I know, technically it was more). If you can have
| swings of +/- 30% over a period of two months, I don't
| think the value is reflecting the long-term prospects.
|
| There is both short-term AND long-term pricing in stocks.
| "In the short-run, the market is a voting machine. In the
| long-run, the market is a weighing machine." Ben Graham
| goatinaboat wrote:
| _Hogwash. Pretty much every company on the S &P 500
| dropped 30% around March. Did their perceived long-term
| value change 30%?_
|
| Double hogwash. That pricing reflected that people
| suddenly needed cash _right now_ and was irrespective of
| what anyone thought about long term value. I will bet
| most of the sellers bitterly regretted it but saw no
| option but to sell at whatever price they could get
| because they had urgent immediate needs.
| _dps wrote:
| Yes, one good way to think about this was that there was
| very little change in the _value_ (fully discounted long
| term etc.) of stocks but a large change in the _price_
| (current exchange rate with other participants facing
| temporal constraints) of cash.
| prewett wrote:
| Right, that's my point: prices don't perfectly reflect
| long-term value. You give an excellent example of why the
| currently price might not reflect long-term value, which
| I need to remember for next time!
| WalterBright wrote:
| The short term price theory requires that anyone selling
| at those short term high prices is selling to someone
| convinced that prices will go higher in the future, i.e.
| that you've tricked them.
|
| Price volatility is an indication that either economic
| conditions are changing rapidly which affects the long
| term prospects, or that people are very unsure about what
| the long term prospects are.
|
| It is not an indication that companies are being rewarded
| for eating their seed corn.
|
| BTW, years ago, I knew a CEO who believed in manipulating
| the accounts to boost the short term at the expense of
| the long term. He made the mistake of telling the press
| he was doing this. The stock immediately tanked.
|
| If the short term pricing theory was correct, the stock
| would have risen.
|
| Then we have companies like Amazon, who explicitly say
| they are sacrificing short term profits for long term
| growth. The result? The stock price has soared to
| incredible heights.
| WalterBright wrote:
| > even if you own a million dollars of Apple shares, that's
| only 0.00007% of the company. Not exactly enough to force
| through a motion on your own.
|
| And it shouldn't be. The board has only 24 hours in a day,
| not remotely enough time to debate every motion from every
| shareholder.
|
| However, as a shareholder, you _can_ dump your stock, which
| does send a message when many shareholders do this.
| michaelt wrote:
| _> as a shareholder, you can dump your stock_
|
| Indeed - but brundolf laments about the lack of
| shareholders "bothered with [Boeing's] nuances or long-
| term health" and having only a single one-bit message is
| not conducive to nuance.
| megablast wrote:
| Sends the message that it's time for the company to buy
| more of their own stock.
| elliekelly wrote:
| But the power behind most shareholder votes is wielded by a
| handful of proxy voting companies who issue
| "recommendations." I don't even a million dollars worth of
| shares to get my way if can convince ISS to agree with me.
| mpalczewski wrote:
| share holders? The same "passive investors" that are buying
| an index fund that includes Boeing.
|
| It's not about leverage it's about taking time and figuring
| out what you are investing in. Everyone wants the free ride
| of "investing" nobody actually wants to pick stocks by doing
| research into which companies have sustainable businesses and
| good governance.
| oaiey wrote:
| To the point. Thanks. Modern capitalism is not good for
| companies, people and society as a whole.
| briandear wrote:
| It's the only system that relies on the willingness of two
| parties to exchange something of value in a way that it
| mutually beneficial. Every other system involves the use of
| force, either explicit or implicit to compel people to act
| in ways that are contrary to their own interests. Because
| if it were in their best interest, force wouldn't be
| necessary. Capitalism requires a willing buyer and a
| willing seller. It's the most free system there is.
| Inefficiencies obviously can create problems, but in those
| problems, there are yet infinite possibilities.
| netsharc wrote:
| I'm not willing to go hungry or be homeless. What if my
| interest is art or playing video games all day, but then
| I'd be hungry and homeless. So I'm forced to work.
| thephyber wrote:
| You say "Modern capitalism" as if there was a different
| capitalism before it. The system is the same (perhaps more
| optimized from longer innovation); the culture and the
| players are different.
| netsharc wrote:
| There was capitalism when communism was still a force.
| That capitalism had to offer something better to workers
| to keep them from thinking "Maybe communism is better?":
| https://www.ingentaconnect.com/content/cuny/cp/2020/00000
| 052...
|
| Nowadays, well, you got your Bezos and you got your
| Uber...
| jackcosgrove wrote:
| "Modern capitalism" might be better called "managerial
| capitalism". It is different from entrepreneurial
| capitalism, which preceded it.
|
| Entrepreneurial capitalism was a constellation of small
| private enterprises, often family-owned. Managerial
| capitalism is characterized by the dominance of firms
| publicly traded on capital markets, and managed by
| professional managers who are often distinct from the
| shareholders.
|
| Entrepreneurial capitalism, I believe, better aligns
| incentives by combining the shareholder and manager role.
| It also reduces dependence on capital markets, which can
| become a single point of failure during a financial
| panic. Lastly entrepreneurial capitalism makes
| coordination between competitors less likely, whereas
| such coordination is embraced by the mergers and
| acquisitions arms of banks in a mangerial capitalist
| system quite openly.
|
| The only advantage of managerial capitalism is scale.
| Pooling capital in public markets permits massive
| economies of scale and their efficiencies.
| Avicebron wrote:
| I think he's saying that the modern economic shell game
| that is going on is actively damaging the economic
| welfare of a large body of people. From my perspective
| the "modern" part of it has become more extractive than
| generative. A lot of "innovation" has been to cut as many
| corners as possible while isolating wealth into fewer and
| fewer groups.
| ken wrote:
| I believe capitalism can work well on a micro-scale when
| the products are simple enough that consumers can exert
| perceivable pressure on producers. Make a better hammer?
| I'll buy a better hammer.
|
| Where modern capitalism falls down is complexity. There's
| 3 (non-niche) desktop operating systems, for example, and
| way more than 3 attributes that consumers care about in a
| computer. Or cars, or TVs, or airplanes, or anything else
| that costs more than $20. There's simply not enough
| levers by which consumers can send any meaningful signal
| through the market to producers. This breaks the
| Invisible Hand.
| ALittleLight wrote:
| Which system is better?
| pjmorris wrote:
| > I have a pet theory that a large portion of the decay in
| our society can be traced back to the layers of abstraction
| between stakeholders and the things (and people) they have
| power over.
|
| My pet theory is a specific instance of yours: MBAs wielding
| spreadsheets (and, more generally, analysts wielding
| databases) is the abstraction layer.
| kevin_thibedeau wrote:
| They also "boost productivity" by shortening schedules by
| 20%. More profit. More corners cut.
| achillesheels wrote:
| Otherwise known as the "democratic means of production" which
| can be measured by how many US citizens own equities (almost
| 50%). And let's not discount the "managerial revolution" that
| has occurred as management:labor ratios have exploded over
| time (and noted by the Pulitzer Prize winning _The Visible
| Hand_ by Alfred D. Chandler, Jr.)
| cls59 wrote:
| Or who don't even care about the long-term health. Extract
| all you can today and dump the remains. Having a company that
| remains healthy and prosperous for generations is not an
| outcome that some investors seem to be optimizing for.
| ksk wrote:
| >Having a company that remains healthy and prosperous for
| generations is not an outcome that some investors seem to
| be optimizing for.
|
| There are plenty of buy-and-hold shareholders investing in
| bluechips.
| brundolf wrote:
| It's not an outcome that public investors are
| _incentivized_ to optimize for. That 's the problem.
| Icathian wrote:
| On the one hand, from a systems perspective, this is
| obviously true.
|
| But I wonder at what point you have to draw the line and
| quit excusing any and all behavior as the result of
| misaligned incentives, and simply hold people morally and
| ethically accountable for the choices they make?
| thereisnospork wrote:
| >But I wonder at what point you have to draw the line and
| quit excusing any and all behavior as the result of
| misaligned incentives, and simply hold people morally and
| ethically accountable for the choices they make?
|
| Your statement is contradictory, incentives _are_ what
| hold people accountable.
| brundolf wrote:
| I'm not excusing it, I'm only being pragmatic. It's well
| and good to push people to be more ethical, but _relying_
| on that trait is a separate question.
|
| The human conscience doesn't do very well with
| abstractions. The further removed someone's actions are
| from the damage caused down the line, the weaker that
| moral signal gets. If we want to improve our society, we
| have to be realistic about these things and design our
| institutions to buttress against them.
| Icathian wrote:
| Certainly, but shaming and shunning are interpreted by
| the human conscience as damage in very real ways. You're
| not wrong, but I think modern sensibility has such an
| adverse reaction to using shame as a deterrent that we
| refuse to call things out as shameful.
|
| Sure, it only works if the people in question care about
| your opinion, but building consensus on what acts should
| be shunned only takes about a generation and a half.
| Segregation, dog fighting, the list is long. If we really
| think this is bad for society (and I do) then shrugging
| and talking about incentives isn't the way forward.
| Especially in the absence of a mechanic to actually
| change those incentives.
| wonnage wrote:
| We absolutely rely on people to act ethically even with
| incentive systems. Every incentive system is prone to
| abuse. Also, people are motivated by different
| incentives. These often boil down to their own
| ethical/moral values.
| paulcole wrote:
| Serious question: Has a company run by engineers ever failed?
| _dark_matter_ wrote:
| Seriously? By the tens of thousands.
| paulcole wrote:
| I guess maybe I am too new here. I thought poor decisions
| were the realm of marketing people, managers, and
| accountants. Perhaps it is possible that an engineer is
| working in marketing/accounting and therefore has to accept
| some of the blame?
| marcus_holmes wrote:
| Companies that focus on doing the thing they do well tend to
| do well. Companies that focus on messing about with their
| finances to keep the investors happy tend to fail.
| paulcole wrote:
| Do engineer ever do thing bad?
| [deleted]
| dustingetz wrote:
| It's not the accountants' fault. The only force binding
| together the thousands of people that make up a corporation is
| the accounting (accountability). Before the advent of
| accounting, there were not corporations, as any concentration
| of capital would be immediately diffused through fraud. It
| would be great if society could figure out how to be
| accountable to metrics other than profit and revenue, but so
| far we haven't figured out how to measure anything else, so we
| can't optimize for it.
| samatman wrote:
| The person you're replying to isn't saying not to have
| accountants. That would be absurd.
|
| They are saying, clearly: _don 't let the accountants run the
| business_.
| specialbat wrote:
| Accountants don't run the business. They provide accounting
| information to those that run the business.
| ken wrote:
| No, this is how Boeing has always operated. It's a cyclic
| industry. Google "boeing employment by year". The charts are
| practically a sine wave. "Hire 10,000 when demand is high, lay
| off 10,000 when demand is low" has been how they've operating
| since WWII.
|
| There are many issues with Boeing management today (I used to
| work there so I love flaming them as much as anyone), but it's
| hard for me to imagine how any aircraft company could avoid
| this. All aerospace employers are laying off (or furloughing)
| workers by the thousands:
|
| Airbus: https://www.reuters.com/article/us-health-coronavirus-
| airbus...
|
| Bombardier: https://www.huffingtonpost.ca/entry/bombardier-
| layoffs-quebe...
|
| Gulfstream: https://www.wtoc.com/2020/05/04/gulfstream-lays-
| off-employee...
|
| No word from Embraer yet, but since their deal with Boeing fell
| through, I imagine it's only a matter of time.
| pcurve wrote:
| Embraer is cutting 4000 jobs too :(
| toomuchtodo wrote:
| I cannot agree more, and yet it's hard to keep these people out
| of going concerns.
| specialist wrote:
| The financiers, not the accountants. To wit, Boeing was doing
| stock buybacks while also "cutting costs" and shaking govts
| down for more cheddar.
|
| It's received wisdom that MD did a reverse takeover of Boeing,
| that Condit got snookered by Stonecipher.
|
| Have many friends, family, neighbors who've worked at Boeing,
| from 1960s thru this year. This version of the post mortem is a
| good starting point.
|
| https://www.theatlantic.com/ideas/archive/2019/11/how-boeing...
|
| Hutzpah is begging the court's leniency, claiming to be an
| orphan, after murdering one's parents. Or eating the seed corn
| and then being surprised by the famine.
|
| You get the idea.
|
| I have zero sympathy for the wrecking crew who destroyed an
| American icon and rage on behalf of all the workers, families,
| and taxpayers who paid the price.
| missedthecue wrote:
| Boeing has been run by engineers for decades. I'm tired of us
| accountants getting the blame for every downturn.
| [deleted]
| esoterica wrote:
| > I realise COVID. But that's the excuse, not the reason.
|
| Demand for planes has cratered due to COVID. That's a 100%
| valid reason to cut jobs, not an "excuse".
| marcus_holmes wrote:
| it cratered for Boeing's planes before that because of the
| Max disaster
| ryanwaggoner wrote:
| It is bizarre and disappointing to see this as the highest-
| ranked comment.
|
| Do you have any evidence that "accountants" made this decision?
| Or that COVID is merely an excuse?
|
| It is blindingly obvious that Boeing has been quite adversely
| affected by this pandemic and that global travel is unlikely to
| return to normal levels for at least 2-3 years. No amount of
| extra spending on R&D or product engineering is going to save
| your airplane company when people don't want to get on the
| plane.
| deepspace wrote:
| Here is a great article that addresses the issue :
| https://www.theatlantic.com/ideas/archive/2019/11/how-
| boeing...
|
| Boeing lost their way in the 90s when the MD merger turned
| them into an accountant-managed company whereas they were
| previously engineering-managed. The resulting 737MAX disaster
| is the main source of their problems today, not COVID.
| gamblor956 wrote:
| You're blaming the accountants for something the article
| clearly says is the result of management decisions...made
| by an engineer...
|
| (McDonnell's Stonecipher was an engineer that rose into
| management ranks and was the one that thought up the
| brilliant idea to just cut costs regardless of the
| consequences.)
| marcus_holmes wrote:
| more mindset than actual qualifications. The point is
| really about losing sight of what the company does and
| focusing purely on the money
| drivebycomment wrote:
| I think this is yet another manifestation of online
| discussions amplifying shallow and simplistic "analysis" that
| appeals to human biases and stereotypes. So I'd say it's not
| bizarre, but another sign of our times.
| rchaud wrote:
| > This is what happens when you let the accountants run the
| business.
|
| You're shooting the messenger when the core issue is that
| Boeing, like all publicly traded companies do not have medium
| to long-term views for their business. It is always quarter-to-
| quarter. That is what management is judged on, because their
| job and their compensation is tied to maximize shareholder
| returns.
| ChuckMcM wrote:
| In my experience at the executive level of a company this was
| never the case. There were always 1 year, 3 year, and 5 year
| plans in place.
|
| Long range plans get re-evaluated periodically because things
| change, both technology and markets but I have never
| experienced them being either ignored or thrown out in
| pursuit of the quarterly 'numbers.'
|
| That said, if your senior management doesn't understand all
| aspects of your product value, they will make poor choices
| both in the short term and for the long term.
| S_A_P wrote:
| This thread reminds me of one I saw on here this morning
| re: the netflix quikster debacle.
|
| I would imagine that it is easy to push a narrative that
| execs are greedy, short sighted and barely competent. I
| would imagine this _can_ be true, but more than likely its
| a bunch of factors that aren 't public that led to less
| than optimal decision making.
| BurningFrog wrote:
| If large companies didn't plan beyond the quarter, a _lot_
| more of them would be failing all the time.
|
| You can't even build a factory in a quarter.
|
| In reality larger companies usually prosper for many decades,
| because they _do_ plan long term.
| rchaud wrote:
| I think you're conflating job losses with not prospering.
|
| Boeing's stock is up on the news. Lost jobs = lower payroll
| = improved cash flow. That's the bottom line. Shareholders
| couldn't care less how you arrive there, just that you do.
| manquer wrote:
| While generally true, The medium term view is why they need
| to let go in the first place .
|
| I am guessing aircraft manufacturing is going to severely
| depressed in the medium term. Customers are delaying
| deliveries, canceling orders etc. Demand will likely not
| return to pre covid levels in even one year. Even if it does,
| airlines are not in any financial position to make
| significant purchases for few years. On top of it 737-MAX
| issues and resulting hold in manufacturing of that line has
| not left Boeing in a great shape.
| brobdingnagians wrote:
| This is one of the best arguments I can think of against
| having large corporations with "corporate person hood". It
| does enable large capital accumulation over time, but that
| capital accumulation eventually becomes so de-personalized in
| how it gets used that it becomes detrimental to society. A
| single private owner tends to care and have more purpose,
| more personal stake in real long-term growth, and can take
| the real risk of investment. Corporations, as we see more and
| more, get huge amounts of capital and then start gaming the
| system for short term executive bonuses.
| Retric wrote:
| Economies of scale are extremely valuable to the overall
| economy as mega corps tend to charge lower prices.
| Similarly, SpaceX as a high risk high cost investment is
| vastly more likely with group funding than a single private
| owner.
|
| Clearly there are some downsides, but managing them via
| laws and regulations is possible.
| ryanbrunner wrote:
| There's a cost associated with this as well though. Those
| lower costs don't come for free - they come from
| increased efficiency which translates to fewer workers
| and less money being redirected into local economies.
| sokoloff wrote:
| Is more workers to achieve the same total outcome a
| desirable state? It seems like what you're proposing
| doing there is literally wasting entire human work lives
| for zero productive output.
| chaostheory wrote:
| Quarterly pressure from Wall Street is not a good excuse.
| That just means that the CEO and other C-level execs are just
| ineffective leaders. People who are too far removed from the
| product, i.e. bean counters with little passion for the
| technology and industry, tend to make bad leaders for firms
| like Boeing.
| tryptophan wrote:
| >like all publicly traded companies do not have medium to
| long-term views for their business
|
| Why do people keep repeating this garbage over and over and
| over? It just isn't true.
|
| Amazon literally didn't make profits for 10 years. Many other
| tech companies haven't made a cent yet, but investors are
| looking 5-10 years into the future for those.
|
| Some businesses just make bad decisions, others make good
| decisions. Overall the free market/public corporation system
| is a resounding success. Just because boeing messed up
| doesn't say anything about the rest of the system.
| dan_quixote wrote:
| > Amazon literally didn't make profits for 10 years.
|
| Yeah, and they caught never-ending flak for it until AWS
| starting turning a profit and eventually dragged Amazon
| into the black. Amazon was/is the exception, not the rule.
| rchaud wrote:
| > Amazon literally didn't make profits for 10 years. Many
| other tech companies haven't made a cent yet, but investors
| are looking 5-10 years into the future for those.
|
| Amazon went public in 1997. Boeing went public in 1962.
|
| You get leeway as a young-ish public company, which will
| expire once you are an established player. How do you think
| markets are going to react if the bottom falls out of
| Amazon's business in 2055?
| myopenid wrote:
| Just maintain the underdog start-up public perception,
| like Google, and all will be forgiven in 2055.
| cwhiz wrote:
| >Overall the free market/public corporation system is a
| resounding success.
|
| We don't have a free market. The market is not allowed to
| implode. Mega corporations and banks are not allowed to
| fail. Boeing is not allowed to fail, and that fact, more
| than anything else, explains why they are such a poorly run
| company. Where you see a "resounding success" I see an
| absolute failure that is closer to a scam or a ponzi scheme
| than a legitimate system.
| Aunche wrote:
| Boeing isn't allowed to fail because they're a national
| security risk. The government doesn't want Boeing's most
| talented aerospace engineers to move to a foreign company
| like Airbus or Comac. The government will happily allow
| businesses like Macy's or Uber go under.
|
| Boeing didn't take the money anyways, so I don't know why
| people are so riled up about it.
| cgh wrote:
| Bear Stearns, Washington Mutual, WorldCom and many others
| are evidence to the contrary. I'm not sure if Boeing will
| be "allowed" to fail if it's on that path, but your
| statement that "Mega corporations and banks are not
| allowed to fail" is simply false.
| cwhiz wrote:
| Yeah every decade or so we let a company fail just to set
| an example to the rest. WaMu, in particular, is a pretty
| hilarious example. We, the public, bailed out JP Morgan
| and with those funds they purchased WaMu at pennies on
| the dollar.
|
| What a deal!
| xyzzyz wrote:
| _Boeing is not allowed to fail, and that fact, more than
| anything else, explains why they are such a poorly run
| company._
|
| So the mass layoffs are just a mirage, and not a failure
| at all, are they?
| Icathian wrote:
| Failure here is obviously defined as ceasing to exist.
| Deliberately missing the point of their argument does not
| strengthen yours.
| eanzenberg wrote:
| You're right, we don't have a free market. We don't have
| the freedom to leave our homes and shop at will. Stores
| don't have the freedom to be open. People don't have the
| freedom to provide services. So until our government
| overlords deem it ok, allowing businesses to fail at-will
| in the existing climate makes little sense.
| fred_is_fred wrote:
| Slight correction: "To an accountant, a drop in costs is MORE
| valuable to the business as a rise in revenue." This is because
| an increase in revenue of 1M does not increase profits by 1M,
| but a cost cut of 1M can.
| Vysero wrote:
| "I realise COVID. But that's the excuse, not the reason." I
| would tend to agree. From what I understand Boeing has spent
| some 70%+ of their free cash flow on buybacks for the past 10
| years; some 40+ billion dollars worth. They spent so much money
| trying to boost their own share prices (legal market
| manipulation?) it's no wonder they have no money.
| thehappypm wrote:
| Accountants? Really? Accountants just provide the reports and
| do the diligence. Executives are the ones making these calls.
| deepspace wrote:
| The problem is not with accountants per se but when
| accountants get promoted to executive positions. They will
| always run the business purely on a short term profit/cost
| basis, whereas operations and engineering managers who get
| promoted will know from experience that you need to spend
| money in the short term to make money in the long term.
| take_a_breath wrote:
| This is a pretty simplistic view of the world. The idea
| that accountants don't understand R&D is silly.
| gamblor956 wrote:
| It has been my experience as a consultant and in-house that
| engineering departments significantly overvalue the R&D
| they perform. R&D has value, but nowhere near what the
| engineers think it does, especially when all of the costs
| of bringing that R&D to market are taken into
| consideration.
|
| See, for example, Juicero, Bird, Boosted, Magic Leap,
| Theranos, etc.
| my_usernam3 wrote:
| Putting this dissenting opinion on HN will likely get you
| downvoted, but I for one appreciate it. There is a
| balancing act of profit vs development that us engineers
| to overlook.
|
| However, some of your examples aren't great IMO. Theranos
| should have been ONLY R&D, as it was never a product that
| was ready to bring to market. Same with Magic Leap.
|
| I think also due to Boeing's business of making tin cans
| move hundreds of miles of hour thousands of feet in the
| air, means the engineering department should be their
| primary focus as well, thus all the outrage at the
| company.
| autokad wrote:
| boeing is having really hard times. Even if it were not for a
| pandemic that directly effects them, the max issues were going
| to hurt. I dont know if they had to lay off those workers, but
| I am not surprised at all.
| marcus_holmes wrote:
| kinda the point. If they were still run by engineers they
| wouldn't be having those Max issues. They might be having
| other issues, of course, but making planes that can't take
| off without crashing wouldn't be one of them
| megablast wrote:
| Ok. So they don't have the orders. What should they do, keep
| paying those people for nothing?
| Avicebron wrote:
| Now maybe we can acknowledge the US shouldn't have axed
| development of a robust high speed train system.
| jrockway wrote:
| I think the fears that are keeping people off airplanes are
| also going to keep them off high speed trains.
|
| I am dreading New York City reopening because everyone is just
| going to drive to the city instead of taking public
| transportation. And it was already overrun with cars.
| toomuchtodo wrote:
| Raise tolls, promote remote work unless you absolutely need
| to be in the city. Use economic incentives to destroy demand
| for unnecessary vehicular travel.
| jrockway wrote:
| I am with you, but we don't have infrastructure for toll
| collection on most of the East River bridges, so there
| isn't an easy answer here. (A lot of the traffic on the
| East River bridges is trucks that are simply avoiding the
| more direct tolled truck routes. It's unfortunate that CO2
| emissions are cheaper than tolls, but here we are. I live
| in Brooklyn Heights which is walking distance to Manhattan
| modulo a big river in the middle, and I know my neighbors
| are just going to start driving to work when things reopen.
| It is going to be a mess.)
| robocat wrote:
| London managed it with congestion charges, and it is not
| an island with limited entry/exit points. No toll booths
| required: it is doable within a reasonable timeframe.
| [deleted]
| rayiner wrote:
| Why is that? Bailing out Boeing every now and then is almost
| certainly cheaper than bailing out a rail operator to the tune
| of tens of billions of dollars _every year_ , and still having
| them teeter on the verge of insolvency:
| https://skift.com/2018/03/05/frances-rail-system-is-falling-...
|
| > Underused stations on expensive tracks are one of the many
| reasons France's vaunted rail system is insolvent, subsisting
| on life support from the state. Rail operator SNCF runs an
| annual deficit of 3 billion euros despite receiving 14 billion
| euros of public subsidies annually--just under half the defense
| budget. Its debt, at 45 billion euros, equals the national debt
| of New Zealand.
| simias wrote:
| It's important to point out that it's low speed, aging
| infrastructure that's a big problem for French rail. Bullet
| trains make a lot of money and in general people complain
| because as a result the SNCF invests a lot more into the
| high-speed infrastructure than to maintain the old, slow,
| regional lines.
|
| The high-speed axes like Paris<->Marseille or the
| Paris<->Bordeaux are definitely not underused and the tickets
| are quite expensive, often more so than plane tickets but
| trains are generally a lot more comfortable and convenient
| (and about as fast or even faster door-to-door).
|
| More broadly the problem is whether you consider that the
| SNCF should be run uniquely for-profit (in which case they'd
| probably end up closing all the small regional lines and only
| run the bullet trains) or if it's a public service that can
| lose money if it provides an important service for the
| citizens (in which case it makes sense to maintain the local
| lines even if they lose a lot of money).
| pen2l wrote:
| Uh, please stop downvoting rayiner. He didn't say anything
| wrong or kooky, on the contrary he provided an interesting,
| substantiated counter-point not often heard around these
| parts. Do you people _want_ HN to become an even worse
| echochamber?
|
| Secondly, it makes it hard for me to read because it's light-
| colored text on light background. So knock it off.
| dangus wrote:
| I want high speed trains as much as the next person, but they
| don't work for the United States in the same way that flying
| does.
|
| High speed rail would work on the coasts and in specific
| intercity regions. There most definitely should be high speed
| rail between nearby large cities - Texas, the Midwest, and
| California could really use high speed rail systems.
|
| But the lack of these routes aren't necessarily a disaster at
| present, especially when Americans generally need a car at
| their destination anyway (thanks to irreversible city planning
| from the past).
|
| What high speed rail can never compete with are flights across
| the huge country.
|
| The world's largest high speed rail network in China doesn't
| have to deal with United States sized distances. All Chinese
| cities are relatively close to the eastern coast.
|
| And all Chinese cities are easy to traverse and live in without
| owning a car. The whole concept of the automobile-based single
| family home detached suburb doesn't exist there.
|
| Even with these advantages, a high speed train from Beijing to
| Shanghai (about 5 hours) barely competes with a flight on a low
| cost airline. It's slower and not even very much cheaper.
|
| Beijing to Shanghai is about 640 miles by plane. That distance
| wouldn't even get you from New York to Chicago. Now imagine
| trying to get from New York to Orlando (940 miles) or Denver
| (1600 miles).
|
| A high speed train simply can't go fast enough to compete on
| price nor time (remember: more time in transit means more
| salaries paid to crew).
| markus_zhang wrote:
| Train beats airplanes by other factors e.g. easy transition
| to subways so people spend much less time going to the train
| station than airports; also airplane especially the cheap
| ones tend to delay for X hours without notice while trains
| are usually on time. Also trains are much more comfortable.
| dangus wrote:
| I agree that those factors can beat airplane travel, but
| none of them really outweigh travel time in practice.
|
| For subway connections, there is no physical limitation
| preventing local transit from connecting to the airport.
| Cities of varying sizes have direct connections to local
| transit (e.g. Chicago, Fort Worth, Cleveland). The fact
| that New York City got this so very wrong is an outlier.
| And finally, subway connection is irrelevant to the bulk of
| American cities that are car dependent. Having a high speed
| train arriving in Columbus, Ohio won't fix the fact that
| you need to rent a car or Uber everywhere once you get
| there (to the point where, if you're within a ~6 hour
| drive, you're probably better off just driving your own car
| that you likely already own).
|
| Flight delay problems are overblown and dramatized, most
| flights are on time. Trains can most certainly be delayed
| as well (usually not as frequently, sure - depends heavily
| on the train system).
|
| Thing is, a flight to LA from New York could be delayed for
| hours and hours and it would still beat the train.
| Avicebron wrote:
| I will second this and also add that I think there are
| unlockable network effects that happen when economic
| activity can be more dense across the country vs. a few
| large metropolitan areas. Of course they could use some
| public transit as well.
| dangus wrote:
| I totally agree with you. The problem is, how do you undo
| a half century of city planning, especially when
| McMansions and subdivisions continue to sprawl to this
| day?
|
| Realistically, you can't - not quickly at least, and
| furthermore you've got a whole population of people that
| is used to this lifestyle.
|
| So I'm just evaluating (in my opinion) the prospects of
| high speed rail based on what we have right now. I think
| if it was a slam-dunk no brainer economic activity and
| tax revenue generator, it would have been done already.
| Avicebron wrote:
| I respect your opinion, I think that it's something that
| takes investment before economic activity is seen. Like
| many startups spending venture capital to build a network
| that doesn't turn a profit until it's scaled to a certain
| size, rail builds economies around it where it is. A lot
| of boom towns in the early 20th century were a result of
| a railway moving through the town. Hotels, restaurants,
| shops, etc were built by rail towns. It provides a
| physical conduit of currency and importantly freight
| moving around the country (but until I have sources up,
| this is my opinion).
| dangus wrote:
| I do see glimmers of that investment for sure! Transit
| oriented developments and downtown revitalization are
| very real trends.
| zitterbewegung wrote:
| Which would be unusable due to the same conditions?
| Avicebron wrote:
| temporarily, but under the guise of defense/critical
| infrastructure it's imaginable there would still be jobs
| available building the system.
| zitterbewegung wrote:
| I mean can't you argue the same about Boeing ? If they
| stopped existing the airlines would still need support from
| Boeing for servicing airplanes.
| hanniabu wrote:
| It's probably for the best. Would have costed 10x as much as
| trains in other countries at 1/4-1/3 the speed. You're paying
| for a lamborghini and getting a honda civic, and you won't get
| it for a decade.
| blaser-waffle wrote:
| Perhaps. I recall articles about how expensive NYC Subway
| projects are...
|
| OTOH how much more expensive is running international
| aiports, airplanes, and jet fuel?
|
| Plus flying _sucks_ , even at the business and first class.
| Amtrack wasn't amazing but I had way more seat space with a
| basic ticket and didn't have to get irradiated and searched
| just to get on a plane.
| Gibbon1 wrote:
| Couple of years ago when someone was arguing with my about
| high speed rail a Brit piped up with how much it'd cost to
| build third runway at Heathrow. Something like $12 to $15
| billion. Which is what convinced me the California High
| Speed rail a good idea. Build that and you don't need to
| expand about 8-12 airports.
| redisman wrote:
| Well we got some ideas for further stimulus for this and next
| year
| Someone1234 wrote:
| I find it all frustrating as heck.
|
| The hardest part about building a railway is the land-rights.
| You need a straight path from A->B, wide enough for at least
| two lines and fence. But once you have that then re-using that
| corridor as railway technology improves is very cheap
| proportionately (e.g. train densities, train speeds, etc).
|
| The problem is that no generation wants to take on the initial
| "buy in," even if it gets more and more expensive as time goes
| on (since there's more property/interested parties along the
| route).
| bgorman wrote:
| The problem is that politics are so corrupt/inefficient in
| the US that the projects go 4x over budget/time with no
| consequences for the politicians/bureaucrats/contractors who
| let things like this happen.
|
| Just look at the Honolulu Rapid Transit Projects and
| California High Speed Rail projects.
| Someone1234 wrote:
| The overruns in California (relative to European norms)
| have been attributed to: Higher property prices, mountain
| ranges, and legal challenges (from property owners,
| environmental groups, and so on).
|
| If you have specific information on "corruption" then you
| can update the Wikipedia article on the project here:
|
| https://en.wikipedia.org/wiki/California_High-
| Speed_Rail#Pro...
| flomo wrote:
| Even ignoring the "expected" inflation of costs. IMO the
| bottom line with California HSR is it would require far
| more tunneling than is feasible to construct. They
| studied it extensively, and LA-SF high speed rail just
| didn't make sense.
| adrianmonk wrote:
| Maybe so, maybe not, but what's the relevance? We're discussing
| something generally transportation-related, so let's discuss
| trains vs. planes too now?
|
| It seems like you're trying to make a connection here, but it's
| not clear what it would be.
| tschellenbach wrote:
| This is one of the hardest things as you scale the business. Make
| sure that the company's hiring effort isn't captured by politics,
| but stays aligned to the mission and rewards those who are
| competent. In a startup it's easy. You have direct market
| feedback. In a big company it's one of the most difficult
| problems to solve.
|
| Feel pretty sure that in those 12k people fired were some of the
| most competent people at Boeing, while some of those better at
| politics were retained.
| wongarsu wrote:
| > The company announced in April it would cut 10% of its
| worldwide workforce of 160,000 by the end of 2020
|
| With production halted for indefinite time for the 737 MAX, and
| no new orders for other planes due to covid that seems
| reasonable.
|
| Still, even if planes don't do well right now and they had a few
| setbacks in their space business (Starliner delayed, and Boeing's
| moon lander proposal losing to competitors), they are still one
| of the largest defense contractors. They will be just fine.
| pyromine wrote:
| It's not so much with regards to whether boeing will be fine,
| it's more about how the general state of the economy as a
| whole.
| rhizome wrote:
| Wars are a cost center. The US is eventually going to have to
| start redirecting tax revenue back to taxpayers, away from the
| military.
| rayiner wrote:
| U.S. governments spend almost $7 trillion annually. Federal
| defense spending is a bit over 10% of that. Does 90% not
| count as "redirecting tax revenue back to taxpayers?" At what
| point does it count?
| deathanatos wrote:
| Federal defense spending is a bit over 25% of the federal
| budget. Adding _all_ US government spending together to
| make the point you 're trying to make is highly misleading;
| any given tax payer likely only pays into one, maybe two
| state governments in any given year; cuts or spending in
| other state governments don't effect them. (I would
| entertain summing an _average_ of local, state, and
| federal, to compare to, but not _all_.)
| rayiner wrote:
| Defense spending is about 15% of the federal budget.
| Which makes sense, because defense one of the key areas
| entrusted to the federal government, as compared to state
| and local governments. Leaving out spending from the
| layers of government assigned primary responsibility for
| things like health and education is a deception intended
| to make defense spending look artificially large.
|
| As to your other point: my calculation results in an
| average. Total spending on defense divided by total
| spending gives you the average spending on defense as a
| percentage of average spending at local plus state plus
| federal levels.
| sachdevap wrote:
| Says who? If history is any proof, I highly doubt this will
| happen.
| Antecedent wrote:
| A draft would do wonders for the unskilled unemployment rate.
| wongarsu wrote:
| War produces jobs (both at the front line and in the entire
| defense sector), and producing jobs gets you reelected.
| munificent wrote:
| _> They will be just fine._
|
| Except for the thousands of people that are now unemployed.
| hellogoodbye wrote:
| Meanwhile SpaceX is launching a manned flight today
| rubicon33 wrote:
| Reminder for those with Oculus Rift / Oculus Quest:
|
| You can view the event in VR using Bigscreen! Today at 1:30 PST
|
| Pop on your Quest, search for "Bigscreen" (it's called
| Bigscreen (Beta)) ... Then show up at 1:30!
| danans wrote:
| How is this relevant at all? Boeing's cuts are being caused by
| a collapse of its commercial airplane business brought on by
| the pandemic. SpaceX doesn't compete in commercial aviation at
| all.
|
| If you're referring to SpaceX winning the launch contract over
| Boeing, that happened a while ago, and has no connection to the
| pandemic or this layoff.
|
| Congratulations to SpaceX for their accomplishment today, but
| it's neither here nor there for the topic of this article.
| wongarsu wrote:
| Boeing's Space branch hasn't been doing well in general.
| Starliner delays lost them a big PR opportunity, their Delta
| IV rocket is getting increasingly fewer launches due to
| Falcon 9 being a serious competitor, and their moon lander
| proposal lost to much less well established competitors.
|
| Their problems in commercial aviation are undoubtedly worse
| and the bigger reason for this layoff, but another major
| division struggling certainly didn't improve Boeing's
| situation.
| danans wrote:
| To me at least, the GP's comment read more like a shallow
| aggrandizement of SpaceX, whose successes and failures can
| stand on their own.
|
| To connect the current layoffs at Boeing to the competition
| in the commercial space launch industry really seems to be
| motivated reasoning that focuses on irrelevant minutiae
| while the whale in the room is the impact of the pandemic.
| wongarsu wrote:
| Which is relevant insofar as Boeing's Starliner was on track to
| be the first American vehicle to deliver astronauts to the ISS
| in nearly a decade, but after their pretty bad test flight
| SpaceX overtook them and are now getting that sweet PR instead.
| khuey wrote:
| It's been a bit of a horse race. SpaceX was kind of in the
| lead for a while but then their capsule's thruster blew up in
| a ground test which set them back several months. Then Boeing
| failed their test flight which let SpaceX get back in the
| lead.
| bronson wrote:
| Except Boeing's Starliner so far has cost Nasa almost 2X as
| much as SpaceX, and is aiming for prices at around 2/3 more
| per astronaut (55mil SpaceX vs 90mil Boeing).
|
| If it's a horse rase, the plough horse is neck-and-neck
| with the thoroughbred.
| imglorp wrote:
| Especially sour because ULA/Boeing is not expected to try again
| until October (unmanned) for their commercial crew ISS mission,
| first manned in 2021.
| smithza wrote:
| I know someone in data analytics as Boeing. As of Sunday he had a
| job. Obviously Boeing is in multiple sectors and don't have all
| of their eggs in the 737-Max basket, working in other areas of
| aerospace and rocketry (see ULA).
| hn_throwaway_99 wrote:
| Really feel for those employees in a time like this. I mean, if
| you're a web software engineer and you get laid of, there are
| literally many thousands of companies who would have a need for
| your skills. If you're an aerospace engineer, how many options
| are there really besides Boeing and a couple of other big guys?
|
| Curious what folks in the aerospace community think.
| aerospace_guy wrote:
| Fortunately, there are a lot of aerospace companies still
| hiring. Look at the aerospace hubs (Seattle, Houston,
| Huntsville, etc.), the defense and space side is still booming.
| downerending wrote:
| I knew an engine mechanic at TWA when it folded up. He switched
| to auto transmissions and heavy drinking. :-(
| jw887c wrote:
| Ex-aerospace engineer here, now software developer. This is one
| major reason why a lot of younger folks at Boeing leave (at
| least the ones with a more broader view of their industry).
|
| A lot of "engineers" at Boeing are actually project / program /
| product managers and can pivot to similar roles at tech firms.
| The stress engineers have it a lot tougher.
| raverbashing wrote:
| > The stress engineers have it a lot tougher.
|
| Well, there's always automotive, aerospace, manufacturing,
| etc.
|
| For mechanical engineers, market is not great, but not too
| bad I guess.
| seanmcdirmid wrote:
| Boeing busts aren't a new thing in the Seattle area. My dad was
| involved in one in 1969 or so...that bust is where "will the last
| person leaving Seattle please turn out the lights" came from.
| balls187 wrote:
| Exactly. I've been in the PNW since the mid-80's and Boeing
| issues are not unusual.
|
| They are one of the largest military contractors (who supplies
| the country that spends the most on military), and it the only
| National aircraft manufacturer.
|
| I feel for the people affected by this, but I don't doubt that
| Boeing will turn things around.
|
| https://www.latimes.com/archives/la-xpm-1998-dec-02-mn-49854...
| [deleted]
| bastardoperator wrote:
| Seeing Boeing engineering practices first hand gave me anxiety
| and concern for the safety of air travel and US defense. Boeing
| is basically 100's of siloed companies living under a broken
| umbrella. Everyone is reinventing the wheel. Sharing code is not
| possible. No inner sourcing. Tons of duplication everywhere. It's
| crazy the amount of waste. I watched nothing happen for 3 years
| other than catastrophic failure and honestly I'm glad to be gone
| and not working with them.
|
| Military projects have it the worst. Depending on the program and
| funding, they either have access to modern tooling or such little
| funding that it prevents them from using something made in the
| last century. This company probably has one of the most
| impressive development tool catalogs a company can have, but most
| developers can't even take advantage of it. They have everything
| and a lot of the teams I worked with just couldn't use the stuff
| so the licenses sit on shelves burning cash. They renewed
| software we migrated away from, just in case... for auditing
| purposes. WTF?
|
| They always had a crazy security protocol for why they cant do
| something too. I get it, defense is important. They tell me they
| want an air gapped system for X, cool here is the link to
| software X and MD5 from our authorized site/customer area.
| They're not allowed to download it, I still get it. Looks like
| I'm traveling to Colorado to hand over a USB stick. Without a
| second thought, I watched the SRE plug it right into his machine.
| Dude no. WTF? This would have been safer to download. Countless
| screen shares with people exposing private keys and passwords.
| The list just goes on and on and on. It's security theatre.
|
| This company is also in love with the H1-B program. I don't mind
| H1-B at all, but when companies exploit humans from other
| countries so they don't have to pay American wages, that's where
| I draw the line, it's bad for everyone except Boeing. They are
| specifically gouging people from India. Couple this with their
| time tracking policies which I wont cover, their business
| practices are fairly absurd and rather disgusting.
|
| Purchasing, holy balls. Every team purchases software
| differently. There is no consolidation or money saving practices.
| This has to do with funding, but someone could do this more
| intelligently. I tried having the conversation with them. Boeing,
| we want to give you back 250K in savings a year by not having 45
| pieces of paper, it's a burden for us too. They don't care.
| Nothing matters over there. You follow the policy or look for a
| new job/vendor. It made me really sad having to work with them. I
| was so excited too, and it quickly faded with all the stupid
| stuff they've imposed on themselves which has led to lives being
| lost and costing people jobs.
| kyuudou wrote:
| > I don't mind H1-B at all, but when companies exploit humans
| from other countries so they don't have to pay American wages,
| that's where I draw the line, it's bad for everyone except
| Boeing. They are specifically gouging people from India. Couple
| this with their time tracking policies which I wont cover,
| their business practices are fairly absurd and rather
| disgusting.
|
| Lot more to it than that, I'd say.
|
| https://www.brightworkresearch.com/enterprisesoftwarepolicy/...
| screye wrote:
| > This company is also in love with the H1-B program.
|
| What ? That rings completely counter to everything I know about
| the aerospace field.
|
| I spent my whole undergrad (Indian citizen) building planes and
| the big reason I left it was that no one in the airplane
| industry would hire engineers without security clearance. H1B
| engineers were legally impossible.
|
| One of my aunts (US citizen) was a top level exec in GE
| Aviation, and she straight laughed in my face at the
| possibility of non-permanent residents / citizens getting jobs
| at any company deeply involved in defense. I have interviewed
| (2019) with Pratt and Whitney, and they too made it clear they
| won't apply for H1bs but they would apply for EB1 Green
| Cards...until which point (first 2-3 years) I would have to
| work on the small subset of non-defense projects. My friends
| who went to US top 10 universities for their masters in
| Aerospace literally returned to India because no one would hire
| them and another of my friend who was a scientist at ISRO (and
| more prestigious Indian defense programs he can't even state on
| his resume) hasn't gotten any call backs for job applications
| at Aerospace companies in the US because of being Indian. He
| has now pivoted to Applied Math as his graduate education.
|
| As an Indian, I literally do not know a single person in the US
| with a job in the aeronautics industry. (Bar one that works at
| NASA-JPL in robotics and got his PR on hire, but he is
| literally one of the smartest and hardest working guy I know)
|
| Now I understand that you aren't lying. But I would actually
| love to know more about the type of roles these H1Bs fulfill
| and how they get past these very real security issues.
| eternauta3k wrote:
| > This company is also in love with the H1-B program. I don't
| mind H1-B at all, but when companies exploit humans from other
| countries so they don't have to pay American wages, that's
| where I draw the line, it's bad for everyone
|
| My perspective as a non-American: I'd gladly work for less than
| "American wages" (which is still more than I earn in my
| country) in exchange for a shot at a green card.
| __abc wrote:
| I'm too lazy to look this up, and probably a bit too cynical, but
| how much stimulus money did they receive?
| CubsFan1060 wrote:
| I believe $0: https://www.cnbc.com/2020/04/30/boeing-raises-
| monster-25-bil...
| __abc wrote:
| Ah, thanks. See, too cynical :)
| hhs wrote:
| This is the letter from the Boeing CEO:
| https://boeing.mediaroom.com/news-releases-statements?item=1...
| laiaondono wrote:
| hpiuhasdfjnad
| DC-3 wrote:
| This is just the start of the trouble for Boeing. They are
| technologically quite substantially in arrears to Airbus, and
| with none of their products able to pull in particularly hefty
| profits anymore they don't have the funds to make the necessary
| investment in R&D to close the gap. The double-punch combo of the
| 737 MAX scandal and the pandemic will have left them in serious
| strife.
| 101404 wrote:
| And they were not considered by NASA for the moon lander
| project.
|
| And they lost the race against SpaceX for crew transport to the
| ISS (with no ETA for certification for their crew transporter).
| hajola wrote:
| > They are technologically quite substantially in arrears to
| Airbus
|
| Could you expand on that?
| DC-3 wrote:
| Airbus has the A320 line, which is a quantum leap ahead of
| the 737, and the A220 line, which is another leap ahead of
| that. The latter, which for my money is the best commercial
| jet in the world right now, also benefits from not being
| subject to import duty in the US, which was previously the
| main reason besides patriotism for US airlines to buy Boeing
| narrowbodies. In addition, although Boeing's widebodies are
| not obsolete in the same way as the 737 is, the A350 is
| probably the best long-haul jet in the world right now. In
| the past, Boeing used to make massive profits on 747s because
| no-one else was selling super-high capacity planes, but the
| A380 squeezed their margins to the extent that they had to
| pursue the sticking-plaster MAX instead of a clean-sheet
| replacement.
| dgemm wrote:
| The 737 was not replaced because of development costs but
| because airlines that are heavily invested in 737s already
| just want more of them. Boeing is really squeezed in that
| situation.
| CydeWeys wrote:
| For starters, their highest selling plane, the 737 series, is
| a six decade old obsolete fly-by-mechanical-cable design that
| sits too low to the ground to fit large modern high
| efficiency jet engines.
|
| Airbus and Embraer both make substantially better planes in
| the same/similar segment.
| loosescrews wrote:
| Well, Boeing now owns Embraer. So they have that going for
| them.
|
| https://en.wikipedia.org/wiki/Embraer#Boeing-
| Embraer_joint_v...
| friedfish wrote:
| Read to the end, they cancelled the acquisition. I
| believe Embraer is suing over it.
| verhey wrote:
| That acquisition was cancelled in April. It's the last
| sentence in your link.
| PopeDotNinja wrote:
| The 737 Max is definitely a rehash if old tech with engines
| that are in an odd spot. However, the main problem with the
| Max is not stability issues without MCAS. It's that the
| took a perfectly reasonable airplane that could fly just
| fine with proper pilot training. But they decided to be
| cheap and make it handle like a regular 737 using the
| flawed MCAS system.
| Gwypaas wrote:
| No it could not just fly fine, it is to comply with
| regulations regarding stick forces when approaching
| stalls. Putting it on a new type certificate would have
| meant that all the old designs and solutions that today
| are grandfathered in by being used for decades safely
| would have to be updated to modern standards while also
| losing all advantages of the large amount of certified
| pilots.
|
| _MCAS is a longitudinal stability enhancement. It is not
| for stall prevention (although indirectly it helps) or to
| make the MAX handle like the NG (although it does); it
| was introduced to counteract the non-linear lift
| generated by the LEAP-1B engine nacelles at high AoA and
| give a steady increase in stick force as the stall is
| approached as required by regulation_
|
| http://www.b737.org.uk/mcas.htm
| josephh wrote:
| > For starters, their highest selling plane, the 737
| series, is a six decade old obsolete fly-by-mechanical-
| cable design that sits too low to the ground to fit large
| modern high efficiency jet engines.
|
| This is an absurd statement. Boeing is still using the same
| design not because they're behind technologically, but
| because their customers do not want the newer 737s to be
| different enough to warrant new type-rating for their 737
| pilots.
| MattGaiser wrote:
| What does Embraer make that competes with the 737? The 195
| has a max capacity well under the 737.
| CydeWeys wrote:
| The 195 has 112 seats vs the 737 MAX 7 with 138 seats.
| That's pretty similar. And the Embraer is cheaper and has
| a nicer/more spacious/more appealing cockpit and
| interior. This is the 737's age showing through here;
| despite the 737 being larger, it's more cramped inside
| than the 195.
|
| Granted, most 737 MAX orders were for larger variants,
| and also the 737 flies farther (the Embraer is very much
| more of a regional jet). But there's a lot of routes that
| could be done using either, and the Embraer wins many of
| those, even before you consider the fact that the 737 MAX
| flat-out can't fly them at all since it's grounded
| indefinitely.
|
| So overall they've got superior competition from Airbus
| throughout the entire segment, and superior competition
| from Embraer at the bottom of the segment as well. Boeing
| is in a rough spot. They should have built a clean sheet
| redesign of the 737 awhile ago to handle the same
| segment, but they did not, and now they're really
| suffering for it.
| bluGill wrote:
| Airlines like southwest need to be convinced to adopt the
| new plane. Their major claim to fame is cutting costs by
| only having one airplane that saves training costs and
| pilots can fly anything they have. (less spare parts for
| maintenance, but they have already lost that with the max
| and other variantes)
| CydeWeys wrote:
| Boeing deserves the overwhelming majority of the blame
| here, not one of their many, many customers. Southwest
| did not want a plane so unsafe that it cannot fly. If
| their wish list desires were not all reasonable, then
| it's Boeing's responsibility to let them know it.
| nickff wrote:
| Yes, Embraer's offerings are more comparable to
| Bombardier's C-series (now Airbus' 220 series).
| jacquesm wrote:
| I fly the 220 regularly on routes within Europe and it is
| rapidly becoming my favorite plane for short hops (< 2500
| km). It doesn't seem to be as easily perturbed as older
| planes, nice cabin, very quick turnarounds so rarely
| issues with delayed flights due to slow turnaround. This
| matters a lot because once you miss your departure slot
| on many airports in Europe it tends to get a lot worse
| right away, not just a few minutes.
| the_mitsuhiko wrote:
| I think the better way to describe this would be that Airbus
| has more of their plane models be on a modern base. All of
| Airbus models are fly by wire and almost all share the same
| type rating.
|
| Specifically the 737 and 757 are based on very old designs.
| nickff wrote:
| The 757 has been out of production for 16 years, it's just
| common because it's cost-effective to own and operate for a
| variety of services.
|
| With respect to type ratings, Airbus shares type ratings
| between the 330, 340, and 350, but the 340 is basically
| gone (few operators), and the 320 (their most numerous
| airframe) is a different type. Boeing has common type
| ratings for the 777 and 787, as well as for the 757 and
| 767.
| Aloha wrote:
| Boeing is looking at restarting 757 production as an
| interim product until a new aircraft can be brought
| online.
| ryguytilidie wrote:
| Do you have a source for this? I hear this every year and
| it never happens.
| Aloha wrote:
| https://www.reuters.com/article/aircraft-projects-
| idUSL5N2CF...
| the_mitsuhiko wrote:
| It's unclear if it happens but it has been mentioned more
| than once over the last two years.
| [deleted]
| hajola wrote:
| Is the new aircraft supposed to emerge from the
| Yellowstone project (Y1)?
| raverbashing wrote:
| I don't think the type rating matches between the 330 and
| 350, there's a 330Neo that might match (and yes it
| matches between the 330/340)
| selectodude wrote:
| They do. A330/A340/A350 are all on the same type rating.
| A319/320/321 are on the other Airbus type rating. Boeing
| has the 737, 747, 757/767 and 777/787 types. Boeing has
| more type ratings because there is less computerization,
| all airbus planes fly the same under normal law.
| Aloha wrote:
| I dont really agree with your assertion that Boeing is unable
| to fund future development - they have a big bucket of cash,
| they appear to have no trouble borrowing, and they have
| profitable military programs. They should be able to fund a new
| narrow body jet with ease. Heck, a modernized 757 would be
| fairly cheap to design/build and its effectively still a pretty
| modern airframe too.
| dcolkitt wrote:
| > they appear to have no trouble borrowing
|
| In the sense that they can still access liquidity from credit
| markets, yes. But they're paying a pretty hefty interest rate
| of 4.50% over the risk-free rate.[1]
|
| That kind of borrowing cost, when compounded, starts to
| become pretty crippling for any sort of long-term R&D or
| product development. Compared to a high-grade corporate, a
| project with a 10-year payback time is 50% more expensive at
| Boeing's current cost of borrowing.
|
| [1] https://www.marketwatch.com/story/boeing-
| lands-25-billion-de...
| ProAm wrote:
| Defense contractors never go out of business, the US
| government will save this company.
| blaser-waffle wrote:
| They'll save the company, but that doesn't mean 12k workers
| are coming back. And they're mostly concerned with the
| Defense/Military aspects -- are they going to fund the
| commercial side too?
|
| (counterpoint -- the USG threw money at auto-makers)
| Robotbeat wrote:
| Yeah, because Boeing is probably the biggest domestic
| exporter. Boeing commercial will be protected.
| Stranger43 wrote:
| But they are occasionally stripped of their civilian
| divisions and merged with other defence contractors.
| dannyw wrote:
| They have no trouble borrowing because the Fed essentially
| signalled they'll pull out all stops to help Boeing bonds.
| Havoc wrote:
| >a modernized 757 would be fairly cheap to design/build
|
| A bit like they modernized their 737?
| throwanem wrote:
| No, and that's the point. The 757 is already a more capable
| airframe, for a start, and there's a lot more leeway for
| the same kinds of modernizations applied to the 737 before
| getting in trouble. Obvious example, more room under the
| wings, so you can use newer, larger, more quiet and
| efficient engines without running out of space and having
| to resort to the kind of CG-shifting "put the engine in
| front of the wing" hack that necessitated MCAS and doomed
| the MAX.
| Havoc wrote:
| You're still talking about modernizing a 40 year old
| design....by a company that fucked up a modernisation
| spectacularly.
|
| >hack that necessitated MCAS and doomed the MAX.
|
| The issue is not that the airframe required it but that
| the corporate culture looked at this issue and concluded
| lets do it. Lets do it DESPITE the problems...that's the
| company you've got leading the modernization of the 757
| you propose.
|
| Boeing will pull through with flying colours though. US
| won't allow their only commercial plane maker to fail
| even if they need to build planes out of freshly printed
| Papier-mache dollars
| Aloha wrote:
| The airframe of the 737 was unsuitable for further
| improvements, the 757 is not the same deal.
| dboreham wrote:
| No. The 757 was a modernized 737 when it was designed. It
| has higher undercarriage.
| foolfoolz wrote:
| this is not true about boeing being behind airbus. boeing saw
| the point to point rise and decrease of hub and spoke years
| earlier and invested in the 787. while airbus has poured
| billions into the a380, now slated for permanent production
| shutdown, which may have never been profitable for the company
| benhurmarcel wrote:
| This is history. Airbus now has the A350 which competes well
| against the larger 787 and smaller 777X.
| AnthonyMouse wrote:
| > The double-punch combo of the 737 MAX scandal and the
| pandemic will have left them in serious strife.
|
| They're probably just redundant. The 737 MAX debacle meant they
| weren't going to sell those planes this year, but the
| coronavirus meant they weren't going to sell those planes this
| year. Same result from one as both.
| willhslade wrote:
| That's... not what canceled out means.
| bobthepanda wrote:
| The 737 MAX was one line of aircraft. COVID is killing demand
| for all the other ones (777s, 787s, etc.)
| AnthonyMouse wrote:
| That doesn't mean they're not redundant, only that the
| bigger problem is bigger.
|
| And Airbus has to deal with the same thing now, whereas
| before Boeing had a unique disadvantage.
| bobthepanda wrote:
| I don't think I've heard anyone use the word redundant to
| describe anything that was more complicated than an exact
| 1-1 replacement. The two-punch combo is a good analogy; I
| wouldn't call a punch that knocked someone out cold
| redundant if it came after a punch that simply gave them
| a nosebleed.
| manquer wrote:
| probably OP means to say given that you got the knockout
| punch the _first_ punch is redundant not the other way
| around. Since no aircraft is selling now, 737-MAX issues
| are no longer relevant is his premise
| redisman wrote:
| Won't Airbus be hit very hard by covid for the next 5 years
| too? Airlines are probably not too eager to order new planes
| for a long time
| hadrien01 wrote:
| If the market shrinks, they'll be hit just like Boeing, but
| there's also the current lockdown hit where Airbus has an
| advantage and can wait a bit more before announcing layoffs:
|
| _> For now, Airbus is relying on government-backed furlough
| schemes in France, Germany and Britain to reduce staff costs
| after earlier asking employees to take 10 days' leave._
| benhurmarcel wrote:
| Airbus is also currently using partial unemployment
| (furlough) in most of its sites.
| redisman wrote:
| Sure but that doesn't sound like a great medium->long-term
| plan. I guess Boeing will get a similar bailout.
| brummm wrote:
| I don't think the US has anything like furlough in
| Europe. Also, Boeing just fired their employees. Nothing
| to be done about that now.
| coliveira wrote:
| Boeing will not go out of business because the government will
| not let it happen. All the aerospace industry starting from
| Boeing and ending with SpaceX is built on the pockets of tax
| payers. But, of course, the profits are private.
| linuxftw wrote:
| Boeing will go out of business, it's inevitable at this
| point. They've outsourced too much of their core engineering
| competencies, core manufacturing operations, and are mostly a
| financial re-packager of other people's products. They can't
| innovate, they don't know how, they can only cut costs.
|
| The workers they're laying off, that's the remainder of your
| operational knowledge walking out the door. They didn't train
| a new crop of engineers to replace the aging ones.
|
| I think we'll see Lockheed or Northrup acquire whatever
| components the DoD needs, and the commercial aviation
| division will be acquired by another conglomerate.
| DC-3 wrote:
| Yeah, the saving grace for them is definitely their
| incestuous relationship with the US Government. But while
| that can save them from total collapse, it can't prop up
| their civil aviation activities on its own.
| zozin wrote:
| As if Boeing doesn't have an incestuous relationship with
| European governments.
| bobthepanda wrote:
| The world may not have a choice but to do so; midsize and
| large planes were already a duopoly, and both had
| backlogged orders in the thousands. Airbus can't absorb all
| these new orders, and there are no other options (not for
| lack of trying; Japan, Russia and China among others are
| all having difficulties with their state-backed aircraft
| development programs; the planes are late, overbudget, and
| generally poorer quality (e.g. shorter range, less
| efficient)). Not to mention the huge fleet of perfectly
| fine Boeing aircraft already operating that still need
| servicing and maintenance.
| JumpCrisscross wrote:
| > _They are technologically quite substantially in arrears to
| Airbus_
|
| I thought Boeing's composites tech is way ahead of Airbus's.
| the_mitsuhiko wrote:
| In which way?
| nickff wrote:
| My understanding is that Boeing has used composites for a
| wider variety of structures, and more complex structures
| than Airbus, though I am not the OP, or an expert in the
| field.
| CydeWeys wrote:
| Unfortunately they're just chasing marginal efficiency
| gains with these. It's much more important to make a
| plane that's safe enough to actually remain in the air.
| nickff wrote:
| The history of aviation is that of chasing marginal
| efficiency gains.
|
| Are you trying to make some nationalistic point, or just
| make yourself sound superior?
|
| Sometimes aircraft crash due to faults in design or user
| interface; examples include the DC-10 cargo doors, de
| Havilland Comet, and arguably Airbus' own A330 in the
| case of AF447. Two Boeing aircraft crashed for a series
| of reasons, yet Boeing still has a storied history of
| making very safe, effective aircraft.
| CydeWeys wrote:
| > The history of aviation is that of chasing marginal
| efficiency gains.
|
| Yes, while crucially, making your plane safe enough to
| fly.
|
| > Are you trying to make some nationalistic point
|
| From the HN rules: "Please respond to the strongest
| plausible interpretation of what someone says, not a
| weaker one that's easier to criticize. Assume good
| faith."
|
| I'll have you know, I'm Nth generation American, never
| lived anywhere else. My American identity, however, is
| emphatically not wrapped up in this one particular
| company. I can be honest when it's faltering and not
| doing well without feeling like I'm letting down my
| national identity. Can you?
|
| This storied history you're referring to is the old
| Boeing. The new Boeing (the one taken over in a reverse
| merger by McDonnell Douglas business people) isn't doing
| so great.
| Alupis wrote:
| > Unfortunately they're just chasing marginal efficiency
| gains with these
|
| Marginal gains is the name of the game for airliners. A
| 2% increase in fuel efficiency is something airlines
| drool over.
|
| > It's much more important to make a plane that's safe
| enough to actually remain in the air.
|
| Which Boeing unequivocally does. Ya, they stumbled with
| the 737-MAX, but all the other perfectly good 737
| variants are still the workhorse of most airlines.
| There's still more 737's flying around than Airbus A320
| variants (including the A321). That doesn't even account
| for all the 767, 777 and 787's flying around the world
| every day... nor all the 747's and DC10/MD-11's shuttling
| freight too.
| CydeWeys wrote:
| > Marginal gains is the name of the game for airliners. A
| 2% increase in fuel efficiency is something airlines
| drool over.
|
| It's not if the resultant airplane isn't safe to use. 2%
| improvement over nothing (because you can't even fly the
| damn thing) is nothing.
|
| Most of the success stories you're referring to are the
| old Boeing, from decades past. The 787 had lots of
| problems but they did eventually get it dialed in with
| fortunately no fatal crashes, just having lost many
| billions of dollars in overruns. But their most recent
| plane is an absolute disaster. They can't keep coasting
| on the successes of the past without making more
| successes in the future. These layoffs are prove of it.
| On their current trajectory, they are _failing_.
| dingaling wrote:
| Airbus was the first company to use a large composite
| load-bearing structure on an airliner, the A300 vertical
| tail back in 1984.
|
| Most of the A380 and A350 are composite, just put
| together differently to the 787.
|
| Airbus also now have access to the most advanced
| composite lay-up technology, used by Bombardier Belfast
| to build the A220 wings.
|
| The real pioneer was Beech, with the all-composite
| Starship; it took huge balls to release that on the
| commercial market, and sadly the gamble didn't pay off.
| They went back to building aluminium King Airs.
| KingOfCoders wrote:
| No, but it probably depends on your definition of "way
| ahead".
| Gibbon1 wrote:
| Course Boeing outsourced a lot of that technology to save
| money. Which didn't save money and now the tech is available
| to their competitors.
| noir_lord wrote:
| US Gov will bail them out (even if optically it doesn't look
| like a bail-out), boeing is a huge defence contractor.
| SpicyLemonZest wrote:
| Certainly, but Boeing stripped down to just its defense
| contracts would be a huge fall.
| rcpt wrote:
| Something like 70% of Boeing revenue is commercial jets
| danans wrote:
| The article is about the jobs disappearing, not Boeing
| disappearing.
|
| Any such bailout isn't going to be enough to bring back jobs
| in the commercial aircraft business, which is likely where
| most of these job cuts are coming from.
| munk-a wrote:
| The original comment was that Boeing is in trouble itself -
| and the parent comment was addressing that trouble and what
| the US response will be.
|
| I agree that those jobs are likely not coming back, but the
| company isn't going anywhere since the US just lost a lot
| of clout covering Boeing when the MAX incident happened -
| they're not going to give up on it now.
| [deleted]
| dougmwne wrote:
| Yes, but there's more than one way to save Boeing's defense
| business and recent scandals have left them with less
| political capital then they would have otherwise had. There's
| no guarantee post-bailout Boeing would be the same company as
| pre-bailout Boeing or even remain a single company.
| alharith wrote:
| Then they can focus on just being a defense contractor. But
| there's nothing that requires them to bail out the commercial
| airline business, and it wouldn't be the first time a major
| aerospace and defense company made this pivot. When Lockheed
| merged with Martin Marietta, they stopped making commercial
| airliners.
| dialamac wrote:
| Boeing is the only American commercial transport jet
| manufacturer based in the US. The US politically would
| never allow the loss of this - whether it be "Boeing" or
| some new named thing that's basically the same. For pro-
| global politicians it would be a major signal of failure of
| American industry, for "America first" isolationists it's
| an obvious problem.
| 7thaccount wrote:
| I think even from a national defense perspective it makes
| sense to retain a lot of the talent and manufacturing
| capability in some ways even if it's no longer WW2 and we
| can just launch a missile now. Maybe call it national
| strategy to have talent in a broad array of fields.
| rurban wrote:
| Which talent? There's only accounting talents from
| McDonald-Douglas left. The technical talent was replaced
| with cheap labor from overseas long time ago. And then
| there are thousands of bean counters to control overseas
| labor. You really need those domestic bean counters,
| that's their speciality.
| 2OEH8eoCRo0 wrote:
| I'm not so sure about that. Contracts are routinely picked up
| by others if one fails. Not only this but even if they fail
| they could partially fail and kill the commercial aircraft
| arm of the company but keep the juicy defense arm.
| greedo wrote:
| Commercial aircraft used to be the juicy part. In terms of
| actual military aircraft, Boeing now only has the P-8
| (success), C-17 (success), KC-46 (debacle), F-18 (success),
| and F-15 (success). The P-8 is a limited contract, the C-17
| is out of production, the KC-46 is just a joke, the F-18
| program is winding down, and the F-15 is hanging by a
| thread. Boeing also sells the AH-64, but it too is a old
| system that doesn't generate a lot of revenue.
|
| The Pentagon and Congress pushed for defense contractors to
| consolidate, in the hopes that the skills needed to produce
| military grade aircraft would be preserved. The US went
| from having Lockheed, Martin Marietta, Boeing, Hughes,
| Vought, Grumman, McDonnell Douglas, Raytheon, Northrop,
| General Dynamics.
|
| All of these contractors were merged under Pentagon
| guidance into Boeing, Lockheed Martin, and Raytheon. In the
| US, these three really have no competition since most
| military contracts prohibit foreign companies from entering
| bids.
| 2OEH8eoCRo0 wrote:
| Agree with most of that but isn't the F-15 alive and
| well? It's not a stealth aircraft but can be loaded with
| advanced electronics and 16 long range missiles and use
| F-35s or F-22s to lock targets for them I believe.
| xtian wrote:
| If they get bailed out, the US public should get an ownership
| stake.
| munk-a wrote:
| If by US public you mean the common citizenry then no, of
| course that won't happen. But you can be certain that any
| public servants helping to grease through the bail out will
| be given quite cushy positions when they retire. That's the
| pattern in the US, when something should go to citizens it
| is instead diverted to politicians while rhetoric about
| bootstraps[1] is voluminously discussed.
|
| 1. Both sides of the aisle have large amounts of corruption
| and are ineffective to the citizenry - but the GOP really
| loves driving home the benefits of bootstraps.
| ideals wrote:
| German government got a 20% stake in Lufthansa for their
| bailout. Seems fair American govt should also take a stake
| when bailing out these companies.
|
| https://www.businessinsider.com/lufthansa-government-fund-
| ap...
| morsch wrote:
| The German government intends to pay 6 billion EUR (+3
| billion in loans), they should own Lufthansa outright.
| It's insane.
| yread wrote:
| What? In the widebody market they are soundly winning. Airbus
| only has a warmed over a330neo to compete with 787
| ryguytilidie wrote:
| Completely disagree. You forgot the A350, which appears to be
| a better plane than the 777x. I also disagree that the A330
| neo is inferior to the 787. Its cheaper, more reliable and
| the fuel burn isn't much different. To say they're "soundly"
| winning in the widebody market isn't correct, and it also
| leaves out the fact that the A220/A3XX is outselling the 737
| like crazy.
| yread wrote:
| OP was talking about technology though: A330 neo is hardly
| technologically superior to 787. Even A350 doesn't have
| some of the innovations of 787 like not using bleed air
| gmac wrote:
| https://en.wikipedia.org/wiki/Airbus_A350_XWB?
| riffraff wrote:
| Wasn't the dreamliner a great success compared to Airbus's bet
| on the A380? (I.e. longer point-to-point routes won over giant
| planes with stops).
|
| Boeing messed up the 737-MAX but I don't remember Airbus as a
| huge source of innovation recently.
|
| But I'm no aviation buff, I'd be happy to learn more.
| useerup wrote:
| The A-320 was a runaway success which threatened to shut
| Boeing out of that segment. Boeing needed to do something,
| and fast. Hence the 737-MAX as a stop-gap until they could
| come up with a better competitor.
|
| Yes, the A-380 (different segment) did poorly. Boeing
| actually had a nice thing going for them with the 787.
| Hunisgung wrote:
| > Boeing actually had a nice thing going for them with the
| 787.
|
| Recently, maybe. But the 787 program had its fair share of
| major issues with the significant delays during development
| and then the battery fires that led to the fleet being
| grounded.
| SilasX wrote:
| Off topic, but: I had never heard that usage of "in arrears",
| and it sounded off because it doesn't even work metaphorically
| with the usage I do know, so I looked it up and ... "It's a
| secondary definition, sir, but it checks out."
|
| 2. (of a competitor in a sports race or match) having a lower
| score or weaker performance than other competitors.
|
| 'she finished ten meters in arrears'
|
| https://www.lexico.com/en/definition/arrears
| ddingus wrote:
| Word of the day is always fun. I see this one used in
| accounting frequently.
|
| This use here is spot on, but not common.
|
| I like uses like this one. Gives a bit of texture to the
| conversation.
| DC-3 wrote:
| I'm slightly surprised to see that this definition is
| considered obscure. Perhaps I've been disproportionately
| exposed to it through my slight obsession with motor-racing
| :-) Having said that, Boeing's situation is closer to the
| first definition of 'debt' than you might imagine, if you
| consider the idea of 'technical debt', a concept that (at
| least in a software context) most of the HN crowd will be
| familiar with. The 737 is in a recognisable state of
| technical debt - if it were a software product, its innards
| would be written in FORTRAN.
| CydeWeys wrote:
| Arrears is derived from an old French word that literally
| just means behind. I've seen it used in English with that
| meaning in ways that are more generic than specifically
| referring to payments.
| te_chris wrote:
| It's very common in English in accounting.
| rdiddly wrote:
| Yep, e.g. _la porte en arriere_ = the back door. Handy that
| the English word has "rear" right there in it. And in case
| this comment doesn't sound snickery/sexual enough yet,
| there's also _derriere_ (butt or rear end).
| irrational wrote:
| Hold on, does the "de" in derriere mean "the" as in "the
| rear"?
| electricviolet wrote:
| No, "de" is a preposition -- "of the rear"
| idoubtit wrote:
| Please excuse me as I'll be a tad fussy. You're welcome
| to pay me back in my own coin with my approximative
| English.
|
| The right expression is _la porte arriere_ (not "en
| arriere"), which usually means the _back door of a
| vehicle_. Some will more correctly say _la portiere
| arriere_. It will rarely endorse the other meaning of
| "back door". Out of context, absolutely no one would see
| anything sexual in this expression.
|
| On the other hand, _la porte de derriere_ will point to
| the door which is on the back side, for instance _the
| back door of a house_. In some contexts, it may convey
| some sexual innuendo.
| mykneehurts wrote:
| Interesting! I would say "la porte de derriere" and never
| heard "la porte en arriere". Can I ask where you're from?
| simias wrote:
| I'd personally say "la porte arriere" for the rear door
| of a car but "la porte de derriere" for the rear door of
| a house for instance. I think the distinction is that on
| a car both sets of doors are side-by-side whereas in a
| house they're in opposition to one-another. That's my
| France's French take at least.
| fbourque wrote:
| "la porte en arriere" or "la porte d'en arriere" sounds
| French-Canadian.
| idoubtit wrote:
| "in arrears" is derived from "en arriere" which is still
| used in modern French. Like most French words, it evolved
| from Latin: ad retro.
|
| In modern French, it's used both literally and
| figuratively. A common folk song goes "3 pas en arriere..."
| (3 steps backward). Similarly, "arrieres" could mean
| "people with retrograde mindsets", or "arrears", i.e. rent
| or taxes that should have already been paid. I suppose the
| English language merged "arrieres" and "arriere" into a
| single word.
| SilasX wrote:
| I made another comment and just updated it, that delves a
| lot deeper into this topic than it really deserves, but
| here you go:
|
| https://news.ycombinator.com/item?id=23326438
| susodapop wrote:
| FWIW I grew up in Alabama in the 90's and this expression was
| not uncommon. Often used to express late child-support
| payments.
| SilasX wrote:
| Right, but that's the usage I was familiar with: having
| some debt that you are behind on paying. The parent was
| using it to mean "performing worse than a competitor",
| which is distinct.
| onlyrealcuzzo wrote:
| I guess I use words pretty liberally, but I don't see
| much of a distinction -- especially when you look at the
| etymology: https://en.wiktionary.org/wiki/arrear
|
| It comes from "to the rear". So, in a competition
| (against Airbus), it means you're behind the person in
| first. On a payment schedule, it means you're behind the
| schedule.
| SilasX wrote:
| Right but it seemed like it didn't work metaphorically
| because a pretty important part of the definition --
| something present every time I saw the term used -- is
| that you're in debt to someone else, usually with the
| connotation of them being able to take the collateralized
| asset. Yet there was no sense in which that relationship
| would apply to Boeing and Airbus.
|
| Every other time someone was behind, they were just
| "behind" -- never saw that prompt the use of a legalistic
| French term the way that "being in arrears" did.
|
| Edit: O...kay, getting some pushback on this. Let me try
| to explain with another analogy.
|
| Let's say I saw a comment that read, "He got involved in
| human trafficking because he has a mortgage."
|
| I had only ever seen "mortgage" used to referred to a
| secured loan for a home.
|
| So I'd interpret the statement to mean, "he has a big
| debt he wants to pay and needs money and that motivated
| him to do slimy things for it."
|
| But let's further say I had specific knowledge that that
| guy had paid off his home loan years ago. Then I'd be
| confused and say so, "uh, what? He doesn't even have a
| mortgage."
|
| Then a bunch of people respond to say, "oh, duh,
| 'mortgage' comes from the French 'death pledge'[1] --
| here they were talking about how he had pledged his life
| to serve the cartels on pain of death." "Oh, yeah, man, I
| use 'mortgage' all the time to refer to a blood oath."
|
| That ... would definitely be news to me. Sure -- I wasn't
| aware of people who had used it the other way. But do you
| see why I would never have abstracted "mortgage" to refer
| to death pledges in general, even with great abstraction
| skills?
|
| Note: "Mortgage", to my knowledge, is not used in English
| in this other way -- I'm just conveying the sense of
| surprise there to learn that, had it actually been true.
|
| [1] https://www.lexico.com/en/definition/mortgage
| jpab wrote:
| For what little it's worth, I had the same reaction as
| SilasX here; I've just never encountered this usage
| before, only the "in debt"/"late payment" usage.
| manquer wrote:
| I have seen it used very commonly for failing or not
| completing courses due, in higher education, in some
| parts of the world
| ryguytilidie wrote:
| That's funny. I was aware of the secondary usage, but not the
| primary.
| option wrote:
| this is a good time for Boeing to invest into R&D so that when
| aviation does recover (a while from now) Boeing would be ready
| with a novel high quality offering.
| Antecedent wrote:
| Happy I studied engineering in university at times like this.
| [deleted]
| wiremine wrote:
| > Edit: I realise [sic] COVID. But that's the excuse, not the
| reason.
|
| Not sure how it's not the reason? (Or, at least a major reason?)
|
| I think there's two things going on:
|
| 1. The long-term vision at Boing: the investment in R&D, etc.
|
| 2. The short-term cashflow issues.
|
| No amount of vision is going to save you from the cashflow crunch
| that a 96% drop in air travel is going to cause. [1]
|
| [1] https://www.cnn.com/2020/04/09/politics/airline-
| passengers-d...
|
| To put this a different way: How could Boing have positioned
| itself to handle a dramatic drop in orders?
| [deleted]
| [deleted]
| lfrmgnd wrote:
| If markets continue to behave as they have, this job cut is a
| signal that BA is going to soar in the next few days.
| Frost1x wrote:
| I suspect you're, unfortunately, going to be correct.
|
| https://www.nasdaq.com/market-activity/stocks/ba
|
| It's interesting how the common narrative uses metrics like low
| unemployment rates during certain touted "economic highs" and
| claim correlates, yet the popular narrative casts aside the
| correlation during times like this and jump into ambiguities
| and positive outlook for justification during certain "economic
| downturns."
|
| It really, IMHO, helps illustrate just how disconnected many of
| these metrics are from economic prosperity for the vast
| majority of Americans.
| coliveira wrote:
| Boeing will survive on the backs of the government, but GE is
| going to have to do a lot more to survive this. Every time people
| mentioned that GE is going belly up they said: no, GE is still
| the leader in aviation engines. Also, GE has billions of dollars
| in loans that need to be repaid, and they were counting on
| selling some of their business to make the payments. Some people
| thought that they were in great shape for "recovery".
| amarant wrote:
| It's funny these news are published the day spaceX launches their
| first crewed mission
| hinkley wrote:
| Boeing kinda does this though. The fact that Boeing benefits
| accumulate based on time employed and not duration of employment
| is a nod to this.
|
| They have a reputation for building a 'company within the
| company' for new plane models, which basically means there's a
| lot of vertical integration that goes on, and you will know a
| great deal about one airplane but maybe not much about any of the
| others. At the height of each cycle they have far more people
| than they can sustain. They seem like a huge company but they're
| market cap isn't that high. Yes, they have a bigger market cap
| than Detroit, but it's also been over 10 years since Apple had
| enough money its war chest to buy Boeing _for cash_.
|
| So when a plane hits pre-production they start to get an itchy
| trigger finger. They get rid of the idiots and the non-essential
| people, and the non-essential people can hop onto the next thing
| in a couple of years.
|
| There's a graph in this article that illustrates:
|
| https://www.seattletimes.com/business/boeing-aerospace/in-go...
|
| They hired like mad for the 787, then did a round of R & D
| layoffs a while after the first flight. If I'm not mistaken the
| rampup of staff after that was to build all of the -8 planes
| which were basically redesigning their other planes with 787
| tech.
|
| So it seems the new triple-7 flew in January, so yep, time to
| trim again. Meanwhile all of those people on the 737-Max are
| probably furloughed, or retraining on another assembly line, and
| there would not be an infinite supply of those even without
| Covid.
|
| It might be more noteworthy to look at how many people _haven 't_
| been laid off in a lockdown situation. A long time ago, the
| powers that be in Washington state looked at traffic patterns
| around Puget Sound and realized that Boeing commuters were a
| large percentage of this traffic. Boeing has offices all over
| King County, but the project you work on might be at an office
| across town, and you might pass several offices on your way to
| work.
|
| So they made a tax deal with Boeing to divert traffic rather than
| building more roads. My understanding is that as part of that
| Boeing allowed people to work from other branch offices, and
| while working from home wasn't encouraged, some bosses would let
| you get away with 1 day a week telecommuting. And I'm not sure
| when 4x10 and 9x9 schedules (four day workweek, 10 hours a day,
| or 9 day fortnight, 9 hours a day) came in, but those helped too.
|
| Conference call software de rigeur, and whole disk encryption
| since before it was cool. There are a lot of quite old building
| blocks in place for at least some departments to keep working
| without being in the same room.
| KptMarchewa wrote:
| >Boeing benefits accumulate based on time employed and not
| duration of employment
|
| What does that mean? What's the difference between "time
| employed" and "duration of employment"?
| hinkley wrote:
| Leaving Boeing stops the benefits clock instead of resetting
| it.
|
| A lot of old companies had benefit carrots designed to keep
| you from leaving, so those benefits come on work
| anniversaries, rather than cumulative years of service. If
| you leave at 4 years to start your own company and then get
| bought or come back, tough luck, you start over.
|
| If you worked at Boeing off and on for your whole career
| you'd still be in the pension program, even if you kept
| leaving every 4 years to do something else.
| MKais wrote:
| The same day SpaceX launches two astronauts to the ISS. How
| ironic.
| [deleted]
| m0zg wrote:
| Yeah, unless that vaccine everyone is working on _really, really_
| works I don't see demand for airplanes (or other forms of public
| transportation, for that matter) coming back to anywhere near the
| level it was before C19. FWIW, whatever travel I do this year
| will be by car.
|
| And chances of that vaccine working _reliably_ are pretty slim:
| we do not have vaccines for any other coronaviruses, and they
| mutate. Our vaccines against the flu (which is not a coronavirus,
| but which also mutates) leave a lot to be desired.
| cs702 wrote:
| No matter how you look at it, Boeing's business appears to be in
| terrible shape. The Atlantic has a decent article on how the
| company lost its way: "a company once driven by engineers became
| driven by finance."[a]
|
| However, from "the stock market's perspective," everything at
| Boeing is _honky dory_ -- the stock is _up_ +2% today.
|
| --
|
| [a] https://www.theatlantic.com/ideas/archive/2019/11/how-
| boeing...
| gamblor956 wrote:
| Note that this article squarely lays the blame on finance
| executives...that were once engineers...
| skny wrote:
| Stock being up 2% today is myopic and meaningless. Look at the
| performance over the last year. FWIW, Wall St isn't a bunch of
| morons trying to financially engineer an airplane to take off.
|
| https://imgur.com/a/lv0yYq9
| eric_khun wrote:
| Bad news for the economy. Market is going to new highs today
| Iwan-Zotow wrote:
| great news for people flying around
| sharkweek wrote:
| pRiCed iN.
|
| I joke, but also, I throw my hands into the air and say, "damn,
| I honestly have no idea how this all works, best just stick to
| target date mutual funds."
| markus_zhang wrote:
| the worse the economy is the more Fed will intervene and the
| higher the market will?be. same thing happened back in
| previous QEs.
| bcrosby95 wrote:
| Free money has to be put somewhere.
| rrmm wrote:
| I will continue to refrain from looking at anything the Fed
| might be doing. I already have enough on my plate to worry
| about.
| baq wrote:
| less jobs == less cost
| MattGaiser wrote:
| Boeing is in the worst-performing segment of the economy for
| the foreseeable future.
| munificent wrote:
| _> Market is going to new highs today_
|
| The top 1% in American own more than 50% of the securities.
| Using the stock market as any sort of proxy for aggregate
| quality of life for all Americans is like saying "Everyone must
| be doing great, caviar sales are through the roof!"
| SV_BubbleTime wrote:
| There is zero rationality in the market right now. Making
| good money on short term options but man this doesn't seem
| "right".
|
| Just looked at the stock and options for Boeing. Going to sit
| this one out. I would normally be ordering a put/short with
| this news, but the way things are going wouldn't be surprised
| to see their stock rise.
|
| Nothing makes sense.
| marvy wrote:
| You probably stopped checking that thread by now, but I
| finally replied to your comment from the day before
| yesterday:
|
| https://news.ycombinator.com/item?id=23306317
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