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  1. #1
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    Smart Move Boeing - How not to treat your neighbor

    I have watched this unfold with annoyance at the arrogance of an aviation giant and the protectionism that is currently in style in the US. The following is from an aviation magazine. One of the few things I think the Liberals have gotten right...

    Boeing Sticks Its Foot In It
    RUSS NILES
    Consolidation of the commercial airliner business has been happening since the first passenger-carrying biplanes rattled across the landscape. In the middle of the last century, there were dozens of viable manufacturers innovating and doing their best to cater to a rapidly evolving industry.
    But being the best has never been a guarantee of business success and Douglas Aircraft was a classic example. The DC-3 was hands down the most successful design of its time but Douglas was unable to leverage that into a dominating position in the jet era. The DC-8 was a rushed response to the Boeing 707 and while it had its fans as a ďpilotís airplaneĒ it never seriously challenged the 707.
    On the other hand, the DC-9 was a tremendously successful design that didnít end commercial service in the U.S. until 2014 when Delta finally retired the steam-gauge workhorses after 50 years of service.
    So itís more than a little ironic that Deltaís choice for replacing the DC-9, whose derivatives ended up being built by Boeing until the middle of the last decade, is the Bombardier CSeries. It ordered 75 with an option for 50 more and nobody is denying it got a smoking deal on what current operators of the type say is a really good airplane.
    That choice turned into one of the biggest shifts in dynamics in the aerospace industry in decades. It also sets the stage for a major battle of giants.
    Boeing started the spat by trying to keep Bombardierís little jets out of the U.S. Itís quickly turned into full-scale warfare with arch-enemy Airbus and the battleground will be the U.S. It also really annoyed Canada, which may not sound like a big deal but it has a role to play in all this.
    Boeing convinced the Department of Commerce to slap an unprecedented 292 percent tariff on the CSeries that Delta ordered in a transparent appeal to economic nationalism.
    Bombardier responded by turning the CSeries program over to Airbus with the idea of building Deltaís planes at Airbusís Mobile, Alabama, facilities. They would be late, but Delta would eventually get them.
    Then, in a decision that surprised every aviation pundit, the U.S. International Trade Commission unanimously rejected the Department of Commerce tariffs, saying since Boeing doesnít make 100- to 150-seat airliners (since it stopped making the DC-9-derived 717), Boeing couldnít be harmed by the CSeries sale to Delta.
    The whole thing changed.
    Delta can now get its aircraft on time and Bombardier has wisely committed to continuing the arrangement with Airbus because that will blunt any further challenges on U.S. deals that Boeing might mount. Cash will be flowing and the CSeries will be in service in the U.S. sooner rather than later. Airbus can be ready to crank out CSeries in Mobile as Delta's U.S. competitors, comforted by the big safety net the association with Airbus offers in the future support of the type, watch the efficient new jets start playing in their sandbox.
    Boeing hasnít commented on the trade commission decision and says itís waiting for the full reasoning before it decides on a response. It might appeal but the decision was unanimous and the odds of success don't look good. At best it would be a delaying tactic but Airbus and Bombardier seem to have that covered.
    In the meantime, Boeing is talking to Embraer about taking over its airliner business in a Hail Mary rearguard action. While Embraer has a solid track record in the small airliner business, any deal with the Brazilian company will not include any defense work because the government of Brazil, which holds a veto vote on the Embraer board of directors, is not about to give up those capabilities to a foreign power.
    There are no such constraints on the Bombardier/Airbus deal and that may be a factor in Canadaís long-overdue purchase of $20 billion worth of fighters.
    Until the CSeries fracas, Boeing was considered the odds-on favorite to win that contract with the last production run of its Super Hornet but the trade dispute has all but ruled that out according to Prime Minister Justin Trudeau.
    So, in its attempt to swat a fly, Boeing has inadvertently stuck its hand down the throat of a lion. Time will tell how many fingers it loses.
    I wonder what Donald Douglas would think.



  2. #2
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    Caper11's Avatar
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    Smart Move Boeing - How not to treat your neighbor

    Its not the first time that Boeing bullied a company into a corner. Look at AV Roe and the Bomarc Missile .


    I wonder what Canada would be like now if Avro was still around, and the conservatives didnít cancel the project.

    Boeing even admitting that it shouldnít of let airbus get as big as they did.
    Last edited by Caper11; February 5th, 2018 at 12:56 PM.
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  3. #3
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    Re: Smart Move Boeing - How not to treat your neighbor

    the US is doing a lot of "protectionism" lately. Even my agri loads of wheat, barley and peas are being subjected to random sampling more than ever before. Each time they do that they take samples from the truck at the border and send them to Maryland for testing. Pain in the a$$ as the truck product cannot be used and takes up to 4 weeks for results.

  4. #4
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    Re: Smart Move Boeing - How not to treat your neighbor

    Quote Originally Posted by eclipse1966 View Post
    the US is doing a lot of "protectionism" lately. Even my agri loads of wheat, barley and peas are being subjected to random sampling more than ever before. Each time they do that they take samples from the truck at the border and send them to Maryland for testing. Pain in the a$$ as the truck product cannot be used and takes up to 4 weeks for results.
    All of this is a byproduct of Trump's America first style of protectionism. In the Boeing case, the C series did not compete with anything they were selling or were planning to sell.

    Softwood lumber is another perennial favourite complaint as they claim Canadian wood is subsidized as the majority comes from crown lands. They keep trying this out but lose in WTO courts.

    Sure would be nice to have good neighbours again. This applies to Provincial neighbours as well.

  5. #5
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    Re: Smart Move Boeing - How not to treat your neighbor

    I can't help but think we'd have far less trade issues if Zoolander wasn't our PM.
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  6. #6
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    Re: Smart Move Boeing - How not to treat your neighbor

    Life would be so much better if we woke up one morning to discover we were the latest 13 states added to the USA.

  7. #7
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    Re: Smart Move Boeing - How not to treat your neighbor

    being in the International Trade biz 30 years by far the worst time we had for issues was Brian Malroney years especially when NAFTA was being negotiated and the Crow Foot subsidy was being pressed for elimination. That was a $hit show.

    Quote Originally Posted by Beels View Post
    I can't help but think we'd have far less trade issues if Zoolander wasn't our PM.

  8. #8
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    Re: Smart Move Boeing - How not to treat your neighbor

    Quote Originally Posted by Cdnfireman View Post
    Life would be so much better if we woke up one morning to discover we were the latest 13 states added to the USA.
    Maybe 12, they wouldn't want Quebec either.



  9. #9
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    Re: Smart Move Boeing - How not to treat your neighbor

    Quote Originally Posted by Cdnfireman View Post
    Life would be so much better if we woke up one morning to discover we were the latest 13 states added to the USA.
    Really? Wow. I will take our brand of f*cked up over theirs any day of the week. Feel free to go down there and find out what it is like. I do a lot of business in the US and it certainly isn't any better - and is often worse - than what we have. It is fine if you are rich but the average guy struggles

  10. #10
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    Re: Smart Move Boeing - How not to treat your neighbor

    Quote Originally Posted by 52weekbreak View Post
    Really? Wow. I will take our brand of f*cked up over theirs any day of the week. Feel free to go down there and find out what it is like. I do a lot of business in the US and it certainly isn't any better - and is often worse - than what we have. It is fine if you are rich but the average guy struggles
    the system in the states works well for the people who put in the effort to get an education, work hard and have initiative. Not so much for the people who don’t have the drive to succeed or better themselves. The social safety net that Canadians think is their right is rare in the states.

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