More interesting news about Boeing as of late. The Seattle Times reported yesterday on the upcoming boon for many Boeing workers from the company's recent success.
Meanwhile, RealCleaPolitics guru and Seattle-native Tom Bevan added some commentary on the company's good news cycle as well. Bevan's coverage includes an excellent summary from the American Thinker on the challenges facing Boeing competitor Airbus in both revamping its product line and retooling its less competitive business practices.
All this occurs in the midst of recent news highlighting Airbus' continued struggles. While the production costs of the delayed A380 keep rising, Airbus is having to offer gratuitous financial terms to waiting A380 customers interested in other Airbus products. Why?
Well, the customers needed the planes on time, and are now turning to Boeing to fill the void.
Emirates is seeking compensation to make up for the revenue lost through the delays."We won't be modest in our demands," Flanagan said. "When we get our first A380, we should have had 18; (it's) a huge hit on the airline and on its revenue producing capability."
In Emirates Airlines' case, that means ordering 66 Boeing 777's, largely to fill-in for 45 delayed A380's.
This all remains good news for Boeing, and for many local workers receiving incentive pay as described in the first Times article above.
This month many Boeing workers will reap the benefit of their productivity.Worldwide, 113,000 people will be eligible for the incentive plan that pays out based on undisclosed internal financial targets set at the beginning of the year.
Meeting those targets merits 10 days' extra pay. Exceeding them can bring up to 20 extra days.
The beneficiaries will include engineers and technical staff -- but not Machinists union members, who negotiated a different incentive package with the company.
Last year, the payout was even better -- 14 days, averaging just over $4,000 for about 45,000 current and former employees in the Puget Sound region. Boeing spokesman Peter Conte said about the same number will receive this year's performance award.
This turn of affairs alternates between odd and humorous. Readers may recall negotiations from the last Machinists strike in 2005. Boeing's last offer before the strike included generous healthcare benefits, wage increases, significant opportunities for incentive pay, and a robust lump sum that could increase 50% further if a worker deposited it into Boeing's 401(k) program. The union, however, was insistent on protecting retiree health benefits and obnoxiously low-cost employee healthcare. Boeing was understandably trying to reduce those same legacy costs that are crippling (or have crippled) many a company in the domestic auto, airline, and steel industries. The union seemed to think it was still the 1950's.
In response, Boeing struck a deal with the Machnists that dropped the lump sum match opportunity, the wage increases, and the incentive pay. Instead, the Machinists got their healthcare demands, but no wage increases that compound over time. They also lost the substantial incentive pay other employees have been enjoying the last two years. Pennywise and pound-foolish for the Machinists if ever there was such a deal.
It is little wonder Boeing's new business model for the 787 - and likely for the eventual replacement to the successful 737 line as well - is heavy on outside partners and Boeing engineers, but less reliant on Machinists. Makes one look forward with interest to the next round of negotiations for the contracts that expire in 2008.
Posted by Eric Earling at February 02, 2007 07:18 AM | Email ThisIn about a year they are going to start saying (with full support of the MSM) about how well the economy has been doing over the past year while they were in leadership. They will start hinting that, as things are going so well, that raising taxes on the "rich" will accelerate the declining deficit, which will turn into a "get the rich" slogan for the 2008 campaign. After all, everyone is doing so well, they can easily afford more...
Posted by: Right said Fred on February 2, 2007 07:38 AMFrom a news report:
"In a recent ABC News/Washington Post poll, only 41 percent of Americans approved of President Bush's handling of the economy.
"Americans may not give the President high marks on his handling of the economy. But, most like where they stand. 59 percent say their own finances are excellent or good."
Stupid -- and consumed with hatred. The DNC and the MSM have done their work well.
Posted by: Rey Smith on February 2, 2007 08:36 AMLet's stop pretending and renationalise Airbus
Financial Times ^ | February 2, 2007 | Paul Betts
Let's stop pretending and renationalise Airbus
By Paul Betts
Published: February 2 2007 02:00 | Last updated: February 2 2007 02:00
Boeing - as the results it reported this week show - is reaping the rewards of the radical restructuring it undertook six years ago when it was in trouble. The US aerospace group closed several plants, outsourced as much work as possible, intensified the involvement of risk-sharing partners in its main programmes, and cut 30,000 jobs.
It is now the turn of its European rival Airbus to be in a mess.
The European manufacturer and its parent EADS are struggling to put together a strategy to cut Airbus back to size and revive its fortunes. Louis Gallois, the Airbus boss as well as the French co-chief executive of EADS, is due to announce his plans later this month, and all signs suggest he will emulate the Boeing model.
The unions in France and Germany are up in arms. They fear job cuts (up to 8,000 in Germany and 3,000 in France) and factory closures. They are lobbying their governments to step in, not only to block the job cuts and closures but - in the case of France - to increase state ownership in the group. Although they do not say so, the unions would like to see Airbus renationalised.
They have a point. It is hard to see how you can transpose the American cut-and-thrust restructuring model in continental Europe with its complex politico-industrial-socioeconomic systems, especially in an election year in France.
And the core German and French private sector shareholdings in EADS are withering away, with Daimler-Chrysler and Lagardère both keen to focus on their respective automotive and media businesses and to sell down their EADS stakes.
The unions and Airbus employees are justified in questioning the approach of the group's core shareholders. The more so given the fact that EADS has brought on more problems than benefits to Airbus.
EADS was a way of privatising Airbus, or at least turning the European manufacturer into a more normal company. But EADS also ended up undermining Airbus by imposing on the group a new breed of managers that broke the old work ethic and enthusiasm.
Rather than maintaining the focus on its dominant civil aircraft activities, EADS complicated matters by seeking to expand its penetration of the defence industry to follow, once again, the Boeing example.
The so-called Power 8 Airbus rationalisation programme, to be unveiled on February 20, aims to save €5bn ($6.5bn) by 2010 and cut costs a further €2bn annually after that. But rather than provoking a confrontation with labour - not just in France and Germany, but in Spain and the UK - Airbus, EADS and their governments need to redefine what Airbus is about. No one seems to have a clear idea.
Given the difficulties of restructuring in Europe, the alternative is to adopt an aggressive commercial strategy to claw back market share from Boeing with the existing Airbus product line andcure the A380 jumbo. Once the A380is fixed, the rest should start falling into place.
In the meantime, an alternative short-term solution would be to rationalise the bloated super-management structure of EADS, with its expensive and enduring Franco-German duplications, rather than cut back on blue-collar workers. Some cynics, however, would say that sacking certain EADS managers would end up costing even more.
In the longer term, and in the absence of committed private sector shareholders, governments will have to decide how strategic they consider the civil aircraft sector and the maintenance of a strong industrial and technological base in Europe. If these things are important to them, they will have to step in and renationalise Airbus until really committed private sector investors are prepared to come in for the long haul.
Of course, this would revive the eternal aircraft subsidies trade war with the US. But then, even under the guise of EADS, the European plane maker was never really privatised.
While unemployment is at an all time low, poverty has risen. And all those great new jobs have not helped the healthcare coverage. So thanks for the job, ummm, I think?
http://www.csmonitor.com/2005/0831/p02s01-usec.html
http://www.npc.umich.edu/poverty/
Poverty statistics are a joke. It's easy to say poverty went up when you leave out substantial forms of income.
As for healthcare, do you think the cost of healthcare will go down if the government takes over? All you'll get is a shifting of payment to $8/gallon gas and lots of other high taxes like they have in Europe.
Do you want your life to depend on the efficiency and competence of the same organization that can't keep millions of people from walking across our southern border, or count votes in a reasonably accurate and honest way, etc. etc.?