[HN Gopher] Will the China cycle come for Airbus and Boeing?
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Will the China cycle come for Airbus and Boeing?
Author : JumpCrisscross
Score : 37 points
Date : 2024-10-27 19:02 UTC (3 hours ago)
(HTM) web link (www.construction-physics.com)
(TXT) w3m dump (www.construction-physics.com)
| chasil wrote:
| COMAC's first sale in the Americas was small. It remains to be
| seen if the footprint will increase.
|
| "...a potential order of up to four C919 planes... Only nine
| C919s are currently in service since they started commercial
| operation in May 2023, all with Chinese airlines."
|
| https://www.reuters.com/business/aerospace-defense/brazilian...
| blackeyeblitzar wrote:
| It's too early to judge. Yes the C919s have had some
| embarrassments (like cabins filled with fog) but I bet they'll
| work out the growing pains quickly and learn. New models often
| have issues - remember the 787 having issues with composites,
| batteries, etc?
|
| Also, Brazil has agreed to provide consultation and technology
| sharing between Embraer and Comac. And Embraer _is_ highly
| competent, with aircraft used in the western world widely, so
| they'll help with a lot of the real world issues. This is
| happening now because of BRICS momentum and Lula (friendly with
| Xi due to some common ideology). But I think whatever China
| gains from this new partnership will remain even once it ends.
| Eventually they'll make the engines and avionics natively too,
| it's only a matter of time.
|
| Meanwhile Boeing has almost no innovation due to a mix of
| financially focused management, union labor culture, and a
| brain drain over the last 25 years. They're not going to
| increase their lead anytime soon, which means the gap can only
| reduce.
| chasil wrote:
| Well, what doesn't make any sense to me is why COMAC let
| Bombardier sell Airbus the A220.
|
| That jet has lots of sales, and half ownership with
| production rights would be fantastic for COMAC.
| VK538FY wrote:
| Wait a second. Did Bombardier have other offers for the C
| Series? It's a great plane but the circumstances of the
| sale are unknown to me. It happened so fast.
| blackeyeblitzar wrote:
| As far as I know, they had no other choice. Boeing was
| rumored to be working with them for a while on an
| acquisition, but then abandoned them and left them in a
| very vulnerable position. Smaller companies without lots
| of working capital cannot absorb a big strategic change
| like that. They had probably already had discussions with
| Airbus that made closing it out much quicker than any
| alternative.
| cherryteastain wrote:
| Canadian government would never allow a Chinese SOE to take
| over something like the Bombardier C series
| matheusmoreira wrote:
| It always impresses me how they've been doing it for decades now
| and it still works. Their strategy is known, people have been
| writing articles and books about it for a long time now. Yet the
| corporations keep handing their IP over to them on a silver
| platter. Greed knows no limits.
| jefftk wrote:
| It's a trade: IP for more sales in China. At this point these
| companies surely know how it works and are doing it because
| they think it's the more profitable choice
| albertopv wrote:
| More sales now, none in the future, though.
| justinclift wrote:
| Yeah. Seems like the kind of thing that would be solely
| pushed by executives/decision-makers expecting to get their
| bonuses and move on before the problems show up.
| HPsquared wrote:
| It's not necessarily greed (profit motive) itself, but that the
| decision makers have a short-term value function. They tend to
| have a "strip it and run" mentality rather than "multi-
| generational family firm" strategy.
| advisedwang wrote:
| It's the usual driver - competition. If a company refuses to
| accept the IP loss of selling to China surely, it thinks, one
| of it's competitors will. That competitor will grow rapidly and
| can then destroy you in the medium term. So better to be the
| company that goes to China and survives the medium term
| existential risk, even if it creates a long term existential
| risk.
|
| This actually points to some reasons why this might not apply
| to aviation:
|
| 1. ITAR restrictions on some of the tech necessary. You don't
| need to worry about your competition going to china if the
| government is making it hard for both of you to go.
|
| 2. Oligopoly. There are few aviation companies, so the "surely
| one of my competitors" and competition generally is weaker than
| in other sectors.
| Havoc wrote:
| Definitely. Reckon it'll take a fair while though.
| Animats wrote:
| It's worse than that. Nobody other than Airbus seems to be able
| to make a good new medium-large jetliner. The C919 isn't very
| good. The Boeing 737 Max isn't very good, and it's a rework of a
| 1960s design. Boeing's New Midsize Airplane (the "797") was
| cancelled two years ago.
|
| Embraer considered building one to extend their line of regional
| jets, but didn't. Bombardier never got that far. Mitsubishi got
| as far as building some 90-seat protype aircraft, then gave up in
| 2003.
| Neonlicht wrote:
| Airliners want cheap and efficient planes that don't require
| retraining their staff.
|
| The name Airbus is disturbingly apt.
| written-beyond wrote:
| Let's start a company called Airtrain.
| thoughtstheseus wrote:
| Yes. Airplanes are complex, high value products with military
| applications. The skill set to successfully develop and field a
| fleet of planes is an obvious upskilling of labor which will
| bleed over to other fields. China cares about economic
| development so they will build planes over and over again until
| they master it. Aviation firms are one of the few industries
| which closely protected their trade secrets making knowledge
| transfers tough.
| justinclift wrote:
| Wonder if there would be transfer to/from their space industry
| as well?
|
| I'd kind of expect there would be.
| cadamsau wrote:
| I hope so. Commoditization should be part of every product's
| lifecycle. If the incumbent can't meet demand then that unmet
| demand becomes a juicy target. And if it _won't_ meet demand (or
| its prices are too high or it raises its prices to match demand
| to supply) then that price umbrella also creates a juicy target.
|
| In other words, barring legal implications this is the natural
| order of things.
|
| Simply inventing something should not confer the right to charge
| as much as one wants for it for eternity, nor the right to
| produce as much or as little as one wants.
|
| And you also have to have some sympathy for the problems Chinese
| leadership face - what are they to do, if mind boggling amounts
| of things must be produced just to keep up with China's own
| indistrialization? Wait around for companies to fulfill orders
| for foreigners and soak up the leftover capacity?
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