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GarryGR

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  • Airbus Vs. Boeing: Who Has The Airplane Of The Future? [View article]
    I made the below comment to an analysis, with lots of nice charts, that Confero (http://bit.ly/1m1ozrh) did. Confero replied "You're right that it's worth looking into the order books. I'll do that when I have some time to spare (it was already on the short list). It might pop up some surprises". I, for one, am looking forward to that analysis. It's been something I've been pointing out for a long time but the "Business Press" keeps ignoring the discrepancy between what the orders imply and what reality shows(the financial numbers), much to Airbus's delight, I'm sure. ;-)


    One of my reply's to Confero:
    The order numbers have favored Airbus for some time now, many years, actually. Airbus has made it a priority to beat Boeing, which they accomplished, sometimes, with some very creative "math". But, the huge order backlog "advantage" Airbus has over Boeing didn't just happen; it's been happening for over a decade now. So, if the order numbers are a good indicator for future success, how come the future that is now, hasn't proven that? For example, Airbus claimed more orders than Boeing 9 out of the 10 years leading up to 2012,and as the charts show, Airbus had a huge advantage in "claimed" order backlog, by then. But then in 2012, Boeing delivered more planes than Airbus did and is expected to do so again this year (now confirmed). This is why the revenue chart has such a huge disconnect with the order backlog chart; the bulk of the revenue occurs at delivery time.

    My impression is that, in order to beat Boeing's numbers, Airbus has taken orders with delivery dates much further out than Boeing’s orders. The further out the delivery date for an order is, the less meaningful, that order is. If that were not the case, it seems to me we should be reading that Airbus is late with deliveries. But it's the other way around; Boeing is missing delivery dates.

    I think that unless we can get more details on those order numbers, namely, how many of those orders are to be delivered this year, next year, etc., that the order numbers are not that meaningful. After all, they are not independent numbers, Airbus gets to decide what their numbers are and in general, they've been deciding that their numbers are going to be bigger than Boeing's! ;-) Why else does Airbus always wait for Boeing to announce their numbers before they announce theirs, sometimes with a rather significant delay?! ;-)

    Airbus is doing just fine and, I'm sure, will continue to do well. But, I've now read that Airbus has an advantage over Boeing in their lineup (aircraft), having previously read the opposite and I find the arguments for Boeing having the advantage more convincing. Because . . .

    It's commonly reported that the A350, being newer than the B787, has newer technology. But it's actually the reverse of that. Airbus made a disastrous first attempt at responding to the 787 and was publically ridiculed, by one of the largest aircraft customers, for that offering's design. In the end, they settled on a compromise, not matching the 787 but keeping the delivery gap smaller than it would have been, if they had tried to match all the innovation in the 787 (or course, they and Boeing had no idea how long it would take Boeing to get the 787 program under control). Customers were not real happy with that but had to go with it; it's not like Boeing could suddenly double their production rates (or Airbus, for that matter). Some (Airbus partisans) were surprised when Boeing took in more orders for the 787 than Airbus did for the new "fly by" A350, at the Dubai Air Show. Doesn't make sense if you believe that the A350 is better than the 787, especially considering that the wait for the 787 is quite long (although that's also true for the A350). And, the 787 program appears to be smoothed out now, with production rate at 10/month and those rates will further increase. I haven’t read much about the A350 program. Last I heard, Airbus hopes to be producing 4/month by the end of 2014. Obviously, it’ll be a while before Airbus can deliver very many A350s, compared to the 787 deliveries, which means Boeing will probably have earlier delivery dates for the 787 than Airbus has for the A350.

    Also, the Boeing 777X will again be a superior offering, assuming all goes well? Airbus is considering a larger A350 as a competitor, but there are limits to how much you can "stretch" a plane and retain the operating SPECs you need. These are some of the arguments I've read for Boeing having the better line up.
    Jan 14 04:05 PM | 1 Like Like |Link to Comment
  • Boeing And Airbus: The Battle For Leadership In The Aerospace Industry [View article]
    The US/Boeing did sue EADS over the 5 EU nation subsidies (WTO) to EADS. Of course, EADS counter-sued. The WTO took a decade to rule, with the general consensus being that the EADS "fine/damages" was much larger than Boeing's ($20B vs. $2B). But, the WTO has no mechanism of enforcement; Both EADS and Boeing declared victory! ;-) Last I heard, the "debate" as to what the WTO rulings mean and what EADS & Boeing need to do to comply, is still ongoing. EADS decided that they didn't need to do much at all and Boeing declared that most of what EADS had complained about had already been addressed (a change in US law).
    Jan 11 01:16 AM | Likes Like |Link to Comment
  • Boeing And Airbus: The Battle For Leadership In The Aerospace Industry [View article]
    Thanks for your reply. I would be very interested in seeing the order backlogs broken out by what they imply for scheduled deliveries, for each year going forward. As I said, I think then you'd have some data that would project potential future revenue, much more accurately. And, also if that were tabulated on a normal and regular basis, any fudging of the order numbers would become obvious! ;-) Not saying anyone would ever do such a thing . . . .
    Jan 8 08:49 PM | Likes Like |Link to Comment
  • Boeing And Airbus: The Battle For Leadership In The Aerospace Industry [View article]
    The order numbers have favored Airbus for some time now, many years, actually. Airbus has made it a priority to beat Boeing, which they accomplished, sometimes, with some very creative "math". But, the huge order backlog "advantage" Airbus has over Boeing didn't just happen; it's been happening for over a decade now. So, if the order numbers are a good indicator for future success, how come the future that is now, hasn't proven that? For example, Airbus claimed more orders than Boeing 9 out of the 10 years leading up to 2012,and as the charts show, Airbus had a huge advantage in "claimed" order backlog, by then. But then in 2012, Boeing delivered more planes than Airbus did and is expected to do so again this year. This is why the revenue chart has such a huge disconnect with the order backlog chart; the bulk of the revenue occurs at delivery time.

    My impression is that, in order to beat Boeing's numbers, Airbus has taken orders with delivery dates much further out than Boeing’s orders. The further out the delivery date for an order is, the less meaningful, that order is. If that were not the case, it seems to me we should be reading that Airbus is late with deliveries. But it's the other way around; Boeing is missing delivery dates.

    I think that unless we can get more details on those order numbers, namely, how many of those orders are to be delivered this year, next year, etc., that the order numbers are not that meaningful. After all, they are not independent numbers, Airbus gets to decide what their numbers are and in general, they've been deciding that their numbers are going to be bigger than Boeing's! ;-) Why else does Airbus always wait for Boeing to announce their numbers before they announce theirs, sometimes with a rather significant delay?! ;-)

    Airbus is doing just fine and, I'm sure, will continue to do well. But, I've now read that Airbus has an advantage over Boeing in their lineup (aircraft), having previously read the opposite and I find the arguments for Boeing having the advantage more convincing. Because . . .

    It's commonly reported that the A350, being newer than the B787, has newer technology. But it's actually the reverse of that. Airbus made a disastrous first attempt at responding to the 787 and was publically ridiculed, by one of the largest aircraft customers, for that offering's design. In the end, they settled on a compromise, not matching the 787 but keeping the delivery gap smaller than it would have been, if they had tried to match all the innovation in the 787 (or course, they and Boeing had no idea how long it would take Boeing to get the 787 program under control). Customers were not real happy with that but had to go with it; it's not like Boeing could suddenly double their production rates (or Airbus, for that matter). Some (Airbus partisans) were surprised when Boeing took in more orders for the 787 than Airbus did for the new "fly by" A350, at the Dubai Air Show. Doesn't make sense if you believe that the A350 is better than the 787, especially considering that the wait for the 787 is quite long (although that's also true for the A350). And, the 787 program appears to be smoothed out now, with production rate at 10/month and those rates will further increase. I haven’t read much about the A350 program. Last I heard, Airbus hopes to be producing 4/month by the end of 2014. Obviously, it’ll be a while before Airbus can deliver very many A350s, compared to the 787 deliveries, which means Boeing will probably have earlier delivery dates for the 787 than Airbus has for the A350.

    Also, the Boeing 777X will again be a superior offering, assuming all goes well? Airbus is considering a larger A350 as a competitor, but there are limits to how much you can "stretch" a plane and retain the operating SPECs you need. These are some of the arguments I've read for Boeing having the better line up.
    Jan 8 04:41 PM | 2 Likes Like |Link to Comment
  • Boeing workers approve contract securing new 777X for Seattle [View news story]
    I agree that workers have benefited greatly by the efforts of unions. However, unions no longer have the clout they used to have and they don't seem to be able to come up with a strategy to get back to, an at least, level playing field. Business, especially the global goliaths, have many tactics at their disposal, to do battle with unions. The biggest advantage, the ability to move work anywhere on the globe (out sourcing). But, global corporations compete with other global corporations. So, you have the downward pressure on the cost of labor. This can not be addressed by "local" union strikes etc. Those tactics just incentivize Business to find a way out, such as moving to locations where unions are weak.

    It seems obvious to me that until unions figure out how to do "global politics" successfully, they are DOOMED-DOOMED-DOOMED, like the commercial says! Hopefully, governments, as well as Business, will address the imbalance before we devolve into utter chaos!
    Jan 6 09:07 PM | Likes Like |Link to Comment
  • Boeing logs record number of deliveries in 2013 [View news story]
    I'm sure Airbus is doing some very sophisticated creative math, so they can come up with bigger numbers! ;-)
    Jan 6 07:21 PM | Likes Like |Link to Comment
  • Boeing workers approve contract securing new 777X for Seattle [View news story]
    From some of what I've read, it appears that some of the older union members thought their pensions would be axed, if the contract was approved. An article today (1/3) quoted an employee who's retiring soon as saying that he got the impression, from the local IAM, that his pension would be gone, if the contract was approved! Man, how could they be so uninformed? And, if the local IAM was intentionally promoting that impression, that's disgusting.

    Thank God, cooler heads prevailed. You'd think with recent union fiascos, such as the UAW and GM & Chrysler, people could recognize reality, but, alas, apparently many never will. Reminds me of a Winston Churchill quote: “The best argument against democracy is a five-minute conversation with the average voter".
    Jan 4 04:34 AM | 11 Likes Like |Link to Comment
  • Boeing: 50% Dividend Hike Good, Buybacks Destroy 30% Of Shareholder Value [View article]
    Boeing gives stock grants and stock options to executives and employees. So, doesn't Boeing have to buy back shares to avoid diluting the share base? Anyone know how many shares that amounts to?
    Jan 1 03:47 PM | 1 Like Like |Link to Comment
  • Boeing approves $10B in buybacks, hikes dividend [View news story]
    Anyone know how many shares Boeing awards every year or somewhere that that total is reported? Some buy backs are required just to "fund" those grants, etc.
    Dec 16 05:33 PM | Likes Like |Link to Comment
  • Boeing-union talks over 777X labor deal collapse [View news story]
    I'm guessing Boeing may well be taking the long view, which is that they have to address the IAM propensity for strikes. There's only one way to do that; move as much work as possible and as quickly as possible, to Right to Work states. The IAM keeps displaying their eagerness to go on strike, by their attitude. And, apparently, the IAM is unable to recognize that the costs to Boeing of their strikes, makes the costs of moving that much more probable.

    As to the pension issue; there are very few workers anymore who have a pension. Like it or not, they are a thing of the past. Pensions provided by companies were always dependent on a company's willingness and ability to pay them. Insisting on having the IAM pension is of little value to workers who do not have a job.
    Dec 13 04:55 AM | 8 Likes Like |Link to Comment
  • Air Canada to buy Boeing single-aisle jets in $6.5B deal [View news story]
    Obviously, this is an unmitigated disaster for Airbus, just as every time a Boeing customers switches to Airbus, it's a disaster for Boeing! ;-)
    Dec 11 07:26 PM | Likes Like |Link to Comment
  • FAA to issue airworthiness directive for GEnx-powered Boeing jets [View news story]
    I find that the fix is a "software" fix, rather intriguing. Anybody know how "software" will fix the problem?
    Nov 26 02:50 PM | Likes Like |Link to Comment
  • 777X Strengthens Boeing's Leadership Position In Large Commercial Airplanes [View article]
    Trefis, you say, "we anticipate global commercial airplane deliveries to rise to 1,480, from 1,410 last year. . . . Of these, Boeing expects to constitute 635-646 deliveries, up from 601 last year". If that's just Boeing and Airbus deliveries, that would leave 834 to 845 for Airbus deliveries, which doesn't sound right? In the last info I've seen, speculation was that Boeing would out-deliver Airbus again in 2013?

    You must be including regional aircraft deliveries, right, or ?? Question is, what are Airbus deliveries expected to be this year?
    Nov 21 06:08 PM | Likes Like |Link to Comment
  • Boeing Battles Union Over 777X - Who's Bluffing? [View article]
    David, you say, "Many believe that Boeing's threat to move manufacturing of the 777X out of state is just a bluff. I don't think so". Not long before the IAM voted, I started reading that Boeing was probably bluffing. But, I think it will be hard for Boeing to come back to the table with an offer of any kind now because of the "bluff" factor. Boeing would essentially be rewarding the IAM no voters, who would, of course, just continue to believe that a no vote will just get them more. I don't know how Boeing can do the 777X here now.

    I too am sad to see "Seattle" lose Boeing work. Unions, the local IAM in particular, seem to have this idea that they are indispensable to Boeing. What's indispensable to Boeing is making a profit, going forward. Unions need to start helping companies to become more competitive by understanding the reality facing the company they work for. Instead of doing that, when the IAM went on strike the last time, they were bragging about how much the strike was costing Boeing for each day they were on strike.

    Workers, especially blue collar workers, need really smart unions representing them. The old "we'll strike and kill the company if we don't get what we want" doesn't work anymore, with the modern global companies like Boeing, because, particularly in the US, corporations have the upper hand. When unions ignore that fact, they are hurting the workers they represent.
    Nov 17 04:32 AM | 1 Like Like |Link to Comment
  • Boeing machinists begin casting historic vote on labor deal [View news story]
    The IAM already lost one bet, the bet that Boeing would not move 787 work out of WA. Airbus, Toyota, Nissan, Hyundai, et al picked Right to Works states, AKA non-union states, for their manufacturing sites. Contrary to what some have said about those state's workers, I've not heard of quality problems with the cars being built there. Matter of fact, they are considered to be high quality vehicles.

    Today's reality is not favorable to unions. As long as companies can pit states against each other, competing for jobs, especially in this economy, unions have a big problem. Ignoring the reality does not help union workers. Unions need to work to address the reasons they're in decline. Working to weaken the company does not help the company's workers.

    It's not as if Boeing is a terrible company to work for; you can do a lot worse. Boeing has no problem finding workers.
    Nov 13 06:50 PM | 5 Likes Like |Link to Comment
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