LONDON — When the CEOs of Boeing’s three divisions — Commercial Airplanes, Defense and Services — appeared before the press Sunday ahead of the Farnborough Air Show, they stuck to a strict script limited to a single overarching message: They are all focused exclusively on improving safety and quality.
They sidestepped questions about potential strategic decisions, including whether to return headquarters to Seattle or assure Washington employees that they will build Boeing’s next all-new jet.
Hours later, at another central London hotel, Airbus management held its press conference and answered questions about the European aerospace champion’s current difficulties with aircraft delivery delays and losses in its space business.
Airbus CEO Guillaume Faury acknowledged the issues and responded to each one. He also highlighted several positive developments, including the certification Friday by the European aviation regulator of the new A321XLR extra-long-haul model for passenger transport.
Faury’s joy at the achievement turned into a dig at Boeing. When the XLR was launched in 2019, Boeing was still considering a completely new plane for the large, long-range single-aisle market, known as the New Small Airplane or mid-range aircraft.
But Boeing abandoned that project. “Some have been talking about the mid-market for decades,” Faury said. “Airbus did it.”
Boeing in transition
Stephanie Pope, the four-month-old head of New Commercial Airplanes, said she is focused 24/7 on Boeing’s turnaround: “developing and executing our safety and quality plan (and) stabilizing our factories.”
“It’s a radical change,” she said. “We’ve slowed down our plants significantly to implement this change.”
“And I’m very clear with my team: This is not about safety and quality versus schedule,” she added. “We have to ensure safety, we have to ensure quality, we have to meet our commitments in a predictable schedule. (…) These are not competing priorities.”
And despite all the bad news this year and concerns about Boeing’s trajectory, she insisted that its planes are performing well and that with orders sold out this decade, “we are a stable company.”
Pope declined to answer whether she was interested in the top job, replacing Dave Calhoun, who is retiring as Boeing CEO later this year.
And she wouldn’t be attracted out on the two options that have been the subject of much discussion in the aviation world: sending a message of real culture change to Boeing employees by moving the headquarters to Seattle, and telling employees in the Puget Sound region that they will be able to build Boeing’s next new plane.
These are questions that industry experts and major Boeing customers are asking.
In an interview a few days before the Farnborough Airshow starts MondayJohn Plueger, CEO of Air Lease Corporation, a major aircraft leasing company and an influential customer of Boeing and Airbus, said the return of Boeing’s headquarters to Seattle would be “a welcome move” not only for employees in Puget Sound but for the entire aviation world, as a gesture that Boeing is serious about returning to its roots and former glory.
“I can hardly think of anyone in the industry, in the airline industry or in the leasing community, those of us who buy new commercial aircraft, who wouldn’t applaud this,” Plueger said.
Plueger added that for Boeing to regain its position in the industry, the next CEO must “focus on the engineering side of the business, to be able to lead a new single-aisle airplane.”
With the single-aisle market skewed 40 percent toward Boeing’s 737 MAX and 60 percent toward Airbus’ A320 family of aircraft, Plueger said Boeing should first launch a new plane in that segment.
Boeing “has an opportunity to come up with something that would help restore a 50/50 balance in the marketplace,” Plueger added.
Also interviewed just before the airshow, Adam Pilarski, a veteran aviation analyst at consulting firm Avitas, said moving the headquarters from Arlington, Virginia, to Seattle would mean only a few hundred employees relocated, but would be symbolically significant.
“It shows that we want to keep our tradition. This is where we come from,” Pilarski said.
But in London, the pope was reticent, focusing his response on what is already happening in Seattle and declining to address possible future actions.
“Our Boeing Commercial Airplanes division is headquartered in Seattle and has always been, as are most of our leaders, including the company’s chief engineering officer, who reside in Seattle,” she said. “The Pacific Northwest has a long tradition of excellence and innovation in aviation, and that will continue.”
The news conference served to underscore how Boeing’s public messaging is hamstrung as it awaits the transition to a new CEO, the timing of which is unknown beyond this year.
Interviewed in London on Saturday, U.S. Rep. Rick Larsen, a Democrat from Everett and ranking member of the House Transportation Committee’s aviation subcommittee, said the extended transition period to replace Calhoun is “excruciating for the region.”
“I don’t like that the region is in this position where we’re sort of waiting for Godot,” he said.
In Samuel Beckett’s play, Godot never arrives, Larsen said, while a new Boeing CEO is set to be named this year. But in the meantime, he added, “the uncertainty is destabilizing for employees. It’s destabilizing for the Everett community.”
And Larsen — who said he came for a brief official visit before the air show to assess “how the industry is evolving globally and what that means for American aviation” — made clear that the question of who will build the next all-new plane is a huge looming issue for both Boeing employees and the Pacific Northwest economy.
Boeing’s assembly line workers “are the ones who are bearing the brunt of the crisis the company is going through. … They are bearing the brunt of decisions made 20 years ago,” Larsen said. “Boeing needs to show that it is committed to valuing these workers.”
“I want it in the Northwest,” he said.
In London, Boeing has not given any details on the matter. For now, its only objective is to stabilize production and reorganize training and the aircraft assembly process to avoid new quality problems.
It will take time to stabilize production sufficiently and get it started safely.
Boeing will report its second-quarter results next week. Given the low rate of aircraft deliveries, the result will inevitably be another large loss and a multi-billion dollar cash outflow.
At the press briefing in London, Boeing’s defense chief Ted Colbert said the financial results will also include significant write-downs for further losses on large fixed-price military and government contracts, including the Air Force One program that provides two new, heavily modified 747-8 jumbo jets for the U.S. president.
Airbus on Boeing’s dizzying fall
Airbus executives were more optimistic and confident about their position.
Asked about the threat posed by the Chinese aviation industry, which launched the COMAC C919 single-aisle aircraft, Airbus Commercial CEO Christian Scherer said he saw COMAC as a serious competitor with an integrated domestic market.
He stressed, however, that the C919 was just a copy of a Western aircraft, nothing new. On the other hand, he pointed out that when Airbus started 50 years ago as a fledgling competitor, it “brought something new to the market”: the first twin-engine wide-body aircraft, the A300, a standard that eventually replaced all four-engine aircraft.
“The C919 is really an A320neo,” Scherer said. “It doesn’t add any value to the market.
And far from rejoicing in Boeing’s fallen position, Scherer said Airbus was taking it as a lesson.
“It’s not good news for our industry as a whole when one player loses control,” he said. What happened at Boeing “is, at best, a salutary reminder that we must not lose sight of the bigger picture.”
“We are focused on what we need to do at Airbus,” he said. “Our trajectory is clear, our goals are clear, our standards are clear and we want to meet them.”
After the Boeing press conference, held in a windowless ballroom in the basement of a grand old London hotel, Pope left immediately without taking questions.
The Airbus event took place in a sunny bar on the top floor of a more modern hotel.
After the event was over, the entire Airbus management team remained on site, moving onto a large balcony and mingling with groups of journalists, freely and easily answering questions while waiters made their rounds offering glasses of champagne and rich canapés.
These were rival management teams facing very different realities.