Boeing Versus Airbus
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34. Richard M. Weintraub and Byron Ocohido, “Boeing May Get Less of Big Saudi Jet Order,” Seattle Times, January 28, 1994, p. 1.
35. John A. Tirpak, “The Distillation of the Defense Industry,” Air Force, July 1998.
36. Conversation with anonymous Boeing executive, May 2005.
37. Conversation with Larry Clarkson, May 3, 2005.
38. Conversation with Boyd Givan, April 19, 2005.
39. Conversation with Harry Stonecipher, March 25, 2006.
40. Conversation with Jerry King, March 16, 2004.
41. Conversation with Jerry Niklesburg, October 28, 2004.
42. Patricia Callahan, “So Why Does Harry Stonecipher Think He Can Turn Around Boeing?” Chicago Tribune, February 29, 2004, p. 6.
43. Boeing Company, Proxy Statement, Annual Meeting of Shareholders, April 29, 2002, p. 11.
44. Conversation with Richard Aboulafia, May 24, 2004.
45. Conversation with Larry Clarkson, May 3, 2005.
46. Conversation with Jerry King, March 16, 2004.
47. Conversation with anonymous Boeing engineer, April 16, 2004.
48. Karen West, “Boeing’s Arrogant Image Must Go,” Seattle Times, March 26, 1998, p. 1.
49. Conversation with Harry Stonecipher, March 25, 2006.
CHAPTER SEVEN. THE VERY LARGE AIRPLANE
1. Conversation with John Hayhurst, March 1993.
2. Conversation with Jean Pierson, June 13, 2004.
3. Conversation with Frank Schrontz, March 18, 2005.
4. Conversation with Jean Pierson, June 13, 2004.
5. Conversations with Larry Clarkson, March 1993 and September 2005.
6. Ibid.
7. Conversation with John Hayhurst, March 1993.
8. Conversation with Alan Boyd, May 1, 1993.
9. Conversation with anonymous Airbus executive, March 1993.
10. Conversation with Frank Schrontz, March 18, 2005.
11. Ibid.
12. Conversation with Larry Clarkson, May 3, 2005.
13. Conversation with Harry Stonecipher, March 4, 2004.
14. Richard Aboulafia, “Boeing 747,” Teal Group report, July 2005, p. 10.
15. Jeff Cole, “Boeing Lands over 30 Orders from Asian Carriers for New 747’s,” Wall Street Journal, August 29, 1996, p. B6.
16. Boeing announcement, March 29, 2001.
17. Conversation with Christopher Avery, June 1, 2005.
18. Conversation with Joseph Sutter, April 20, 2004.
19. Conversation with Larry Clarkson, May 3, 2005.
20. Conversation with Richard Branson, June 15, 2004.
21. Conversation with Gerard Blanc, June 10, 2004.
22. Boeing News Now (online), December 20, 2002.
23. Conversation with Gerard Blanc, June 10, 2004.
24. Ibid.
25. Conversation with Hanko von Lachner, June 10, 2004.
26. Sara Kehaulani Goo, “Airbus Hopes Plane Will Take Off, Beat Boeing,” Washington Post, December 19, 2004, pp. 1, 22.
27. Conversation with Jean Pierson, June 13, 2004.
28. Adam Brown, “Airbus’ View of the Future,” keynote speech delivered at International Air Transport Association Conference for the 21st Century, Frankfurt, Germany, May 26, 2004.
29. Conversation with Clancy Wilde, March 15, 2004.
30. Conversation with Christopher Avery, September 20, 2005.
31. Reuters, May 18, 2004.
32. Conversation with Michael di Giralamo, September 21, 2005.
33. Kevin Done, “Infrastructure Must Improve Rapidly,” Financial Times, July 19, 2004, p. A32.
34. Ibid.
35. Conversation with Michael di Giralamo, September 21, 2005.
36. Conversation with Frank Clark, March 11, 2004.
37. Conversation with John Martin, October 4, 2004.
38. Conversation with Alan Mulally, May 6, 2005.
CHAPTER EIGHT. A CHALLENGE FROM ASIA
1. E-mail exchange with Stan Sorscher, October 14, 2005.
2. Stanley Holmes, “Boeing’s High Speed Flight,” BusinessWeek Online, August 12, 2002, http://www.businessweek.com/magazine/content/02_32/b3795088.htm.
3. Ibid.
4. Dominic Gates, “Airbus Parent to Build Key Part of Rear Fuselage for Boeing 787,” Seattle Times, October 18, 2005, p. 3.
5. Conversation with anonymous Boeing vice president, August 4, 2004.
6. Dan Morgan, “Is It Sharing Know-How or Selling the Store?” Washington Post, May 4, 1983, p. A1.
7. Dominic Gates, “Separation Anxiety: The Wall Between Military and Commercial Technology,” Seattle Times, January 22, 2006.
8. Conversation with anonymous, April 23, 2004.
9. "The Downfall of a Great American Airplane Company—An Insider’s Perspective,” pp. 6–7.
10. Conversation with anonymous former vice president GE Aircraft Engines, August 18, 2004.
11. Conversation with anonymous U.S. government official, July 14, 2004.
12. Conversation with Pierre Chao, February 24, 2005.
13. Conversation with anonymous, April 2, 2004.
14. Conversation with anonymous former Boeing CEO, December 5, 2005.
15. Conversation with anonymous Japanese official, October 21, 2005.
16. Conversation with anonymous, October 20, 2005.
17. “Airbus Tells Suppliers: Outsource to Asia,” Aviation Week, November 21, 2005, p. 20.
18. Holmes, “Boeing’s High Speed Flight.”
19. L. J. Hart-Smith, “Outsourced Profits—the Cornerstone of Successful Subcontracting,” Boeing Third Annual Technical Excellence Symposium, February 14–15, 2001.
20. Conversation with anonymous Boeing engineer, May 21, 2004.
21. Conversation with Phil Condit, March 15, 1993.
22. Conversation with Richard Albrecht, March 17, 1993.
23. Kristi Heim, “Boeing Stumbles in Race for China,” Seattle Times, June 5, 2005, http://seattletimes.nwsource.com/html/boeingaerospace/2002307265_boeing china05.html.
24. Ibid.
25. Conversation with anonymous industry executive, October 17, 2004.
26. Charles Hutzler and Daniel Michaels, “Airbus Struggles to Get Chinese Order,” Wall Street Journal, December 3, 2004.
27. Conversation with anonymous industry executive, October 17, 2004.
28. Conversation with Christian Scherer, June 11, 2004.
29. Mariko Sanchanta, “Airbus Sets Out to Break Boeing Hold on Japan,” Financial Times, February 10, 2005, p. 15.
30. Adam Brown, “Airbus’ View of the Future,” keynote speech, International Air Transport Association Conference for the 21st Century, Frankfurt, Germany, May 26, 2004.
31. Dominic Gates, “Boeing High on India,” February 22, 2005.
32. Manjeet Kirpalani, Stanley Holmes, and Carol Matlack, “Dogfight over India,” BusinessWeek Online, May 2, 2005.
33. Richard Aboulafia, Teal Group Briefing Book Series, February 2005, p. 2.
34. “Details of Boeing’s Outsourcing Strategy,” Boeing strategy paper, July 15, 2005, p. 8.
35. “Jet Propelled,” Airline Business, November 21, 2005.
36. Ibid.
37. Gates, “Boeing High on India.”
38. John Lancaster, “India Is Fertile Soil for Airlines,” Washington Post, February 22, 2005, p. E1.
39. Byas Anand, “Airlines Trying Hard to Woo Customers,” Economic Times, September 12, 2005, http://economictimes.indiatimes.com/articleshow/1227696.cms.
40. Conversation with Paul Kiteley, June 9, 2004.
41. Ibid.
42. Peter Gregg, keynote address, Asia Pacific Aviation Summit, Sydney, Australia, August 9, 2005.
43. Kevin Done, “Dubai Spreads Its Wings into Aerospace,” Financial Times, February 20, 2006, p. 1.
44. Conversation with Senior Australian Official, February 27, 2004.
45. Kevin Done, “Qantas Order Sees Boeing Claw Back Share from Airbus,” Finan
cial Times, December 15, 2005, p. 21.
46. Conversation with Airbus official, January 10, 2006.
47. Mark Landler, “Airbus Edge in Sales in ’05 Comes with an Asterisk,” New York Times, January 18, 2005, p. C1.
CHAPTER NINE. MUDDLING THROUGH, MORE OR LESS
1. Conversation with Phil Condit, July 13, 2004.
2. Conversation with Harry Stonecipher, March 27, 2006.
3. Bill Virgin, “Oh, Won’t You Come Home, Boeing?” Seattle Post-Intelligencer, March 29, 2005, p. C1.
4. Stanley Holmes, “Boeing Attempts a U-Turn at High Speed,” BusinessWeek Online, April 16, 2001, http://www.businessweek.com/magazine/content/01_16/b3728103.htm.
5. Rachael Horwood, “Boeing Versus Airbus,” Economist, July 24, 2003.
6. Conversations with Steve Sleigh, April 2 and 11, 2004, and February 27, 2006.
7. Conversation with Phil Condit, December 5, 2005.
8. Conversation with Harry Stonecipher, March 2, 2006.
9. Conversations with Steve Sleigh, April 2 and 11, 2004, and February 27, 2006.
10. John Newhouse, The Sporty Game (New York: Alfred A. Knopf, 1982), p. 23.
11. Caroline Daniel and Demetri Sevastopulo, “Inside the Iron Triangle,” Financial Times, December 7, 2004, p. 21.
12. Conversation with Senator John McCain, Feburary 5, 2004.
13. Ibid.
14. Joseph L. Galloway, “Tanker Bid Was Tailored to Boeing,” Philadelphia Inquirer, March 28, 2004, p. 1.
15. R. Jeffrey Smith, “Roche Opposed Review of Alternatives to Plane Deal,” Washington Post, July 30, 2004, p. 6.
16. United States Senate, Committee on Commerce, Science and Technology, meeting transcript, p. 14.
17. Jeffrey H. Birnbaum, “Boeing Has a Powerful Ally with Hastert,” Washington Post, July 18, 2004, p. A10.
18. Conversation with Senator John McCain, February 5, 2004.
19. Daniel and Sevastopulo, “Inside the Iron Triangle,” p. 21.
20. Financial Times, November 23, 2004, p. 4.
21. Dominic Gates and Alicia Mundy, “Boeing’s Lawyer Warns of Company’s Legal Peril,” Seattle Times, January 31, 2006, p. A1.
22. Ibid.
23. James Wallace, “Hard-Nosed Stonecipher Retires at Boeing,” Seattle Post-Intelligencer, June 1, 2002, p. A1.
24. Conversation with anonymous executive, March 3, 2004.
25. Dominic Gates and David Bowermaster, “Blunt Boeing CEO Bullish on Company’s Prospects,” Seattle Times, August 2, 2004, p. A1.
26. J. Lynn Lunsford, “7E7 Facing Powerful Resistance,” Wall Street Journal, April 22, 2003, p. C1.
27. Ibid.
28. Conversation with Harry Stonecipher, March 25, 2006.
29. Conversation with John Pleuger, March 26, 2004.
30. Lunsford, “7E7 Facing Powerful Resistance,” p. C1.
31. Stanley Holmes, “Why Boeing’s Culture Breeds Turmoil,” BusinessWeek Online, March 21, 2005, http://www.businessweek.com/magazine/content/05_12/b3925039_mz011.htm.
32. Kevin Done, “Airbus Delivers Record Profit for EADS,” Financial Times, March 9, 2006, p. 15.
33. Robert Wall, Michael Mecham, and Andy Nativi, “Airbus Redesigns A350,” Aviation Week, May 23, 2005.
34. James Wallace, “Airbus to Use Composites,” Seattle Post-Intelligencer, January 10, 2006, p. C1.
35. Boeing Company, “Statements on CFRP vs. Aluminum Lithium,” August 18, 2005.
36. Dominic Gates, “Airplane Kingpins Tell Airbus: Overhaul A350,” Seattle Time, March 29, 2006.
37. “Airbus Should Redesign the A350, Singapore Airlines Says,” Bloomberg News Online, April 7, 2006.
38. Dinah Deckstein, “Fiery Letter from the Chief of Sales,” Der Spiegel, February 6, 2006.
39. Conversation with Jean Pierson, July 26, 2006.
40. James Wallace, Seattle Post-Intelligencer Aerospace blog, July 19, 2006.
ACKNOWLEDGMENTS
I am grateful to Bruce Blair, the president of the World Security Institute, as well as my friend and colleague, for letting me write this book on WSI’s premises. That helped a lot.
I must thank Victoria Garcia and Holly Mackey for finding documents that otherwise would have been adrift in cyberspace, and for helping in other ways, including organizing notes.
I am also grateful to Andrew Wylie and Jeff Posternak for the sound advice and support they provide in representing me.
Lastly, I want to thank Ash Green, my editor on this and three other books, for his friendship and support.
A NOTE ABOUT THE AUTHOR
John Newhouse covered foreign policy for The New Yorker throughout the 1980s and early 1990s, and has written numerous profiles of world figures. He served as assistant director of the U.S. Arms Control and Disarmament Agency, and was senior policy adviser for European affairs in the State Department during the latter half of the Clinton administration. He lives in Washington, D.C.
ALSO BY JOHN NEWHOUSE
Imperial America: The Bush Assault on the World Order
Europe Adrift
War and Peace in the Nuclear Age
The Sporty Game
Cold Dawn
U.S. Troops in Europe: Issues, Costs, and Choices
DeGaulle and the Anglo-Saxons
Collision in Brussels: The Common Market Crisis of June 30, 1965
THIS IS A BORZOI BOOK
PUBLISHED BY ALFRED A. KNOPF
Copyright © 2007 by John Newhouse
All rights reserved. Published in the United States by Alfred A. Knopf, a division of Random House, Inc., New York, and in Canada by Random House of Canada Limited, Toronto.
www.aaknopf.com
Knopf, Borzoi Books, and the colophon are registered trademarks of Random House, Inc.
Library of Congress Cataloging-in-Publication Data
Newhouse, John.
Boeing versus Airbus / John Newhouse.—1st ed.
p. cm.
Includes bibliographical references.
eISBN: 978-0-307-26726-9
1. Boeing Company. 2. Airbus Industrie. 3. Aircraft industry–United States. 4. Aircraft industry—France. 5. Competition, International. I. Title.
HD9711.U64B646 2007
338.7'629133340944—dc22 2006030611
v1.0
*1Washington hasn’t lodged objections to this subsidy, partly because of Rolls-Royce’s special importance to Britain and, more important, because of the special relationship between Washington and London; the war in Iraq, of course, has tightened that link.
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*2On March 26, 2006, Airbus successfully completed a passenger evacuation test, as required by the American FAA and the European Aviation and Safety Agency (EASA). The test, according to Airbus’s announcement, “was the most stringent ever performed and the first ever on a passenger aircraft with two decks. The aircraft was fitted with a very high density cabin layout featuring 853 seats which were all occupied. In addition there were two flight crew members and 18 cabin crews from Lufthansa on board to manage the evacuation in a representative way. The trial was performed in darkness and filmed with infrared cameras. The doors and slides that were operative were not known before the trial.”
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*3The penalty for crossing the line included a settlement with the Justice Department that required Boeing to pay $615 million to avoid criminal and civil charges. It was the largest penalty ever paid by a defense contractor.
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