“Too Low Terrain” – the seismic shift facing Boeing Commercial Aircraft (part 1 of 3)

In 1997 two acclaimed airliner manufacturers Boeing and McDonnell Douglas joined forces in what promised to be a “win, win” for the stockholders and customers.

There is no question that Boeing provides exceptional products across its aerospace portfolio.

So, what’s gone “wrong” with its commercial aircraft business, and more importantly, what can it do about it?

It’s well reported that, following the 1997 merger, a new mindset and culture began to grow within the Commercial Airplanes division – short-term stockholder value (and it is reported, executive remuneration) became key points of focus.

From the position of being able to charge a premium for its commercial aircraft products, critical quality problems (a key issue in a safety-critical industry) emerged.

Delays in the 787 “Dreamliner” production preceded electrical wiring issues, and the well reported battery fire that grounded one airline’s aircraft for months.

There were also supplier issues with 787 engines having to be removed for inspection and overhaul due to fan blade degradation.

The stock-price languished during the period from 2006 to 2013 until it started to break out towards a four-fold increase in value by 2018.

Then came the Lion Air (2018) and Ethiopian Airlines (2019) 737-8 Max accidents……

Continued in part 2 of 3

Barry Eustance CMgr MCMI
Kotter Change Leader Certified
Principal Consultant – The Sixsess Consultancy
Empowering Clients to Seize Opportunity from Change
 
(Barry flew globally as a pilot and captain of airline passenger jets for a 25 years during his 48 year flying career).
 
https://sixsess.org