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A R C H I V E S

     “The biggest problem with communication is the illusion that occurs.”
     It doesn’t happen often. You look up in front of you and there against a bland background at one of those minimal speaker stands is the boss of one of the biggest, most powerful companies in the world.

Allan Mullaly

     As he speaks in a distinctively American way about what is going on right now, you get an emotional rush that’s part sad, leaning toward melancholy.
     By the time he is finished three quarters of an hour later, the feeling notches up a bit to hopeful.
     Allan Mulally, President and CEO of the Boeing Commercial Airplane Company and 33-year veteran of the company held a room full of reporters in the palm of his hand on December 20th, telling all within the sound of his voice, and a worldwide Internet hookup what lay ahead for the big airplane maker and the rest of commercial aviation as well.
     Gone was the hubris and élan of just a few short years ago. Boeing, by any measure is a company in as much trouble as it has ever faced.
     Boeing, it turns out, is in some ways, just like the rest of us.
     Mr. Mulally spoke in frank and even, uncomplicated terms about a company which has faced up to whether it will continue, and has decided that living is better.
     “Not many companies could cut production in half and survive,” he said.
     “Boeing will produce 24 aircraft a month into the foreseeable future.”
     Unspoken, but evident at the press briefing was one truth:
     Everything the company is up to these days points to one reality:
     When business comes back, Boeing will be a continued major world force.
     For Americans, it seems a long way from the time when eight out of ten of the world’s aircraft were made here.
     A week after Mr. Mulally spoke, would come a Christmas order to Boeing from China Airlines for ten B747-400s (six are freighters).
     Although it is fair to say he had the order in his back pocket as he spoke, he said nothing about it.
     For one thing, orders for B747s have been few and far between. The CAL bump did little to fatten investor’s wallets either as the aircraft had already been counted as sold albeit as “unspecified sales” in earlier 2002 Boeing financial reporting.
     In fact, the China Airlines order needed big time, high-level juice in the form of arm-twisting from President Bush to reverse an all-Airbus order that would have eliminated Boeing from future CAL plans altogether.
     Originally the order was to be for 20 Airbus aircraft and none to Boeing. But in the end, each manufacturer sold ten aircraft.
     CAL, for its part, had executive “sources” telling everybody it got the Boeings at cut-rates , way off the sticker price, with old aircraft buy backs and other incentives.
     There is a growing feeling amongst some in Taiwan, that it is now OK to link the future of the island nation with the mainland.
     As America’s airplane manufacturer to the world, Boeing, among other things is experiencing “Who needs America?” from places like Taiwan. Once Boeing could think of places like that as close as it gets to a license to print its own money.
     Allan Mulally knows that 2002 has been a bummer for his business and everyone else’s.
     Worldwide, airlines lost ten billion in losses in 2001, another seven billion in 2002. The industry is caught between terror and recession with 2000 airplanes on the ground and no mission in sight for them right now or soon.
     The downturn will continue for at least another year and longer, Boeing tells the reporters.
     “Less than 285 aircraft will be delivered in 2003 with about the same number slated for 2004,” Mr. Mulally declares.
     The Sonic Cruiser is a dead duck. While not ready to say ‘never’ about the Sonic, Boeing has another idea.
     The company will field a new line of ‘middle market’ airplanes using everything it has learned lately, including listening to its customers.
     Including economies and other technologies from its wonderful B777s and Sonic Cruiser studies, the new line of passenger liners will carry less people, further and faster just like the bigger intercontinental jets.
     The “middle market” family of aircraft from Boeing will be sized between the B737 and B767 aircraft.
     “Technological synergies, noise and fuel efficiencies will meet the desire of operators to fly point to point in aircraft that can grow an airline into a B-777 sized aircraft carrying less passengers, at faster speeds with less fuel burn.
     “We will launch in 2004. We think that the market for these aircraft could be as large as three thousand airplanes.”
     Mr. Mulally was reluctant to say that the new middle market aircraft spells the end of the line of B757 and B767 but the indication is that eventually that is exactly what will happen.
     “Both aircraft are market leaders for single and twin aisle aircraft. We expect to continue deliveries in these aircraft especially to customers who already fly them.”
     Boeing sees no end to its wildly successful B737 series with a B737-900 slated up next.
     “The B737 is an amazing airplane operating 100 to 250 seat configurations once the 900 series debuts.”
     As to what number will the new middle market aircraft carry (B787 was mentioned), Mr. Mulally admitted the decision to go forward with the project had just been taken and that the final number has not yet been determined.
     He also deftly sidestepped a new number combination, saying that unlike the last time when Boeing thought up a number “B777” and he was not in on that decision, that this time the number was at least partially his call:
     “Seven has been lucky for us, so has eight,” he said.
     What a frank and down to earth presentation. Most people admit to needing or at least accepting a “little bit of luck” in their life’s effort.
     Now down from the mighty mountains of the Northwest, here is the boss at Boeing admitting he doesn’t like the traffic jams in the Puget Sound area and that his company would rather halve its commercial business than lose it all and with a little bit of luck his new future order for middle market aircraft will be the right choice for the legendary manufacturer.
     It’s a long way back to reality from earlier this year at The Paris Air Show, when Airbus showed up with a life-sized cross section of its huge A380 aircraft and Boeing countered with a plastic model of its send-up Sonic Cruiser.
     The message for the Year 2003 from the Boys at Boeing seems to be “don’t count us out” quite yet.
     To be sure, now that Boeing has a robust military business to fall back on as the result of the McDonnell Douglas and other takeovers , it is not unfair to wonder if temptation lives somewhere amongst its executives to back up on the commercial aircraft business.
     But now by design Boeing is the last big airplane builder in America left standing in what was once a field that included the likes of Douglas, Lockheed, Convair, and before that Consolidated, Martin, Ford and a dozen others who fielded commercial aircraft.
     The message seems to be that Boeing will better manage its business, talk to its customers to chart a future, that will expand the company’s manufacturing activities internationally.
     If this recent presentation, straight from the shoulder of its CEO is any indication, a new Boeing is already in business.
     Recent announcement that finally the great B727, the airplane that saved LaGuardia Airport and a dozen other “in town” facilities around the nation and world four decades ago, and a production run of better than 2,000 aircraft, would be retired from all U.S. carriers after next year, reminds us that greatness has and continues to be part of every day in the history of Boeing.