[stg22]

The role of McDonnell-Douglas is exaggerated. Boeing had achieved pretty close to a monopoly in the mid-1970s, but things had changed by the mid-1990s.

1. Domestic airlines protected by regulation had been effective monopolies and Boeing's engineer-led culture thrived in an environment where airlines didn't care about costs. But that environment died with airline deregulation in 1978 and an engineer-led culture made it more difficult to compete in a cost sensitive environment.

2. Airbus' rise put Boeing on the defensive for the first time in many decades. By 1996, Boeing's market share was less than twice Airbus' and falling rapidly enough that people could foresee the day when Airbus would overtake them. Although Airbus had good aircraft, their key advantage was they could sell them for lower prices than Boeing could.

3. Shareholders had become increasingly activist, quick to overthrow management when they weren't getting enough dividends and share price increases, and willing to install new management who would give them what they wanted.

Outsourcing, cost-cutting, and a move to an accountancy-led culture were the obvious responses to these challenges and Boeing's then CEO, Phil Condit, had already started the ball rolling on them before buying McDonnell-Douglas.

[naasking]

> an engineer-led culture made it more difficult to compete in a cost sensitive environment.

I know this is a common sentiment, but I don't quite get it. Engineering is often about optimizing multivariate functions, and cost is just another variable to optimize. If you frame it properly to engineers, they can solve cost problems too.

[epistasis]

Agreed. Maybe I have become too much of a PHB, but I find that engineers (or scientists in my case) really love having cost as one of the visible metrics to optimize for, and will generally do a fantastic job at evaluating it amongst quality concerns. At least much better than management can do.

[idiotsecant]

Given the choice between cost optimized and safe, fast, cool, etc very few engineers are going to go for cost savings. If there's no bean counters in charge and no market cnstraints its obvious that the product is going to be really good and really expensive.

[throw0101d]

> If you frame it properly to engineers, they can solve cost problems too.

In eng school there was a saying: An engineer is someone who can build something for $4 that any fool can build for $7.

[ks1723]

This is too simple. For large endeavors (building a plane) it is impossible to formulate all contributions to all quality criteria/cost and constraints into a technical engineering optimization problem. Let alone when re-structuring and optimizing the company organization and processes to build those planes at the same time.

[KennyBlanken]

What's wild is that all this happened even with the NSA conducting industrial espionage on Airbus on behalf of Boeing and M-D.

[MikePlacid]

Industrial espionage does not necessarily improves engineering culture.

When I visited NITsEVT, a big-big-big organization dedicated to adapting of the stolen IBM 360/370 software to Russian language and Russian computer variants - I was amazed at how low the software culture was there. It looked like the only way to implement something was to look at how some American (but not necessarily bright) person has implemented some similar thing.

The whole “adaptation” project led to overall degradation of software culture as compared to 60s, when a lot of Russian system software was an original one. Or so a lot of people were saying.

[obmelvin]

Is there any evidence that's what happened? As far as I can tell, the NSA was doing it's routine thing of spying on foreign governments and and discovered that Airbus was trying to bribe a gov official.

Maybe you agree with Henry L. Stimson that "Gentlemen do not read each other's mail", but I haven't seen anything indicating that the NSA was spying on behalf of Boeing, or even directly targeting Airbus. Maybe I missed something, would be happy to learn if you have any sources to share :)

[ARandomerDude]

Is the NSA discovering bribery really “industrial espionage”? I don’t like the NSA but that characterization is a bit of a stretch.

[RcouF1uZ4gsC]

French intelligence has been doing full scale industrial espionage on US companies for quite some time.

https://www.hanford.gov/files.cfm/frenchesp.pdf

[jjeaff]

I don't think secret tech or cloak and dagger business moves are what makes an aircraft company win. it's a far more complex amalgamation of government intervention, regulations, institutional knowledge, and company culture. Things you could never steal with spies.

[Solvency]

Source? Or... book even?

[EndorphinRush]

This isn’t Reddit. Do better.

The article referencing this and Airbus is rather sensationalized and cuts off half the quote. This was said in reference to Airbus bribing foreign officials to buy from them. The full quote reads:

"When we have caught you at it, we haven’t said a word to the U.S. companies in the competition. Instead we go to the government you’re bribing and tell its officials that we don’t take kindly to such corruption. They often respond by giving the most meritorious bid (sometimes American, sometimes not) all or part of the contract. This upsets you, and sometimes creates recriminations between your bribers and your bribees, and this occasionally becomes a public scandal…"[5]

[5] R. James Woolsey, "Why We Spy on our Allies," Wall Street Journal, March 17, 2000.

The source unfortunately is locked behind a paywall so admittedly I don’t have the full context either.

[AniseAbyss]

What's happening to Boeing isn't really remarkable lots of dinosaur conglomerates rise and fall.

I'm just a casual follower but it seems their glory days are from the 60s and 70s and they've been coasting along since then.

[quink]

> glory days

1971: Will the Last Person Leaving SEATTLE — Turn Out the Lights

I’d argue the 757, 767 and 737 Classic (i.e. -300 to -500), all of which much more 80s than 70s were much more glorious.

And the 90s brought us the 737NG and 777 which continue to carry more than everything else today and for that matter anything else ever, other than maybe the A320ceo.