$5bn and counting. Plus the $3bn to develop the Max and you're not talking a whole bunch more money to develop a new jet from scratch - as I said further up in this thread.


This may also kick the NMA further down the road as they won't have the funding available to start a new project for a year or two. Not that I would want to if I were Boeing, I'd want to get my house in order before doing that.

To quote myself....

Perhaps Boeing is being comprehensive, but my guess is that we will see further charges. But even if this is the final number, they will have ended up spending $7-8B (minimum) on the MAX, while a clean sheet would have cost $12-15B, and less had Boeing done it when first proposed 15 years ago, rather than as the Board elected to do - try to Milk the 737 and reduce investment.

I actually think the problem is bigger than this. Boeing can't commit to the 797 program until they get the MAX issues resolved, and as they wait some of the anticipated customers are moving on (ordering more 787s, as AA did, or ordering A321neo/LRs). But - because Boeing cut its engineering capacity dramatically when it off-shored the 787 work, and is highly committed to the 777-8/9 project, if they do the 797, there will be no possible way for them to even think about a new narrow body aircraft for at least the next 6-7 years, and certainly not get one in the air for probably 10+ years.

As a practical matter, Boeing will have to either go with the 797, and hope Airbus does not eat their lunch over the next 10 years with the A320/321neo, A321neoLR, and the A220, or give up on the 797 (and try to sell de-tuned/discounted 787s as with AA) and commit the resources to a new narrowbody.

Well it appears that the costs are much higher than suggested by the earlier reports. Boeing on its call - which in full disclosure I did not listen to - is reported to have said the compensation to airlines would cost at least $5.6B, and production delays would cost at least $2.7B. Not counting the extra engineering costs, or compensating the victims, this is $8.1B.

Given these numbers, Boeing will have spent more on the junk MAX than they would have just developing a clean sheet new narrow market airline. This disaster just keeps growing in scale. Clearly one of the worst business decisions ever. When you are a MFG company, and you don't invest in your future, you end up getting killed in the market.

See https://www.theguardian.com/business...-max-grounding

The decision now to extend the 30 year old design is looking more and more like a FUBAR decision where program managers, VPs and many others probably could have, should have stood up and spoken and asked hard questions.

The cash cow could be dead, the whole financial picture for the company can be questioned.

I think every airline board is challenging their CEO's and companies growth plan with the Max and what the implication of waiting for an airplane that might now be delayed more than a year, never gain customer confidence versus getting in the last in line for the Airbus versus trying to get inline earlier on the Airbus line.

Boeing says it might have to shut down 737 Max production
https://www.cnn.com/2019/07/24/busin...oss/index.html

When will we see the first customer convert their MAX order to a NG (with appropriate behind the scenes financial maneuvering to factor the losses from the delay/grounding of MAX 737s into a mega discount)?

If you can develop a completely new aircraft for less than $8 billion, I would suggest you stop whatever you're doing and start an airplane manufacturing company.

This argument makes no sense.

Why do you automatically believe that a clean-sheet aircraft would have been less problematic? You're just assuming that these problems only occurred because the 737 MAX was a reconfigured 737NG. There's no reason to think that problems couldn't have occurred with a clean-sheet replacement either.

If they'd developed a clean-sheet aircraft, and it had two fatal crashes, you would have been saying it was the worst business decision ever, and they should have stuck with the tried-and-true 737 design instead of starting from scratch.

Plus, Boeing was never going to abandon the 737. They were going to invest that money in the 737 no matter what.

Are you suggesting that their reluctance to think forward justifies their strategy?

I think Boeing are thinking about the future a great deal. They have in the past and they will in the future.

The 737 is here to stay for the foreseeable future. There is nothing wrong with the model. Boeing have definitely screwed up certain aspects of the MAX, which can and will be fixed.

777x will be delayed.
 

Somewhere in the article, a mention on the 777x.

In addition to the 737 Max issues, the company also warned Wednesday that it may not be able to deliver its newest aircraft, the 777X, by the end of next year, as it had hoped. Previously disclosed problems with the jet's General Electric engine means that target for the first delivery is at "significant risk."

https://cimg4.ibsrv.net/gimg/www.fly...e546e70aed.jpg

During my first trip to India in the late 90s, a large percentage --perhaps the majority, even-- of cars on the road were Hindustan Ambassadors, which didn't change a whole lot since they were first launched 40 years prior. I haven't been to Cuba yet, but I hear things are similar there.

It saddens me to think that the leading aerospace company in my own country has similar attitudes towards innovation. Yeah, let's Frankenstein our 40 year old design because we only have a single competitor, and our customers don't care.

First flight of the 737 was April, 1967.
First flight of the 320 was February, 1987.