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The Chinese COMAC C919 airplane, which seeks to challenge the market dominance of the Boeing 737 and Airbus A320, has made its maiden flight.
The new narrow-body twin-engine passenger jet took to the skies of Shanghai on Friday. The maiden flight had been delayed at least twice since 2014 due to production issues, according to Reuters.The state-owned producer of the plane, Commercial Aircraft Corporation of China (COMAC), says there is a $2 trillion market for the new plane, which was first revealed last November.
I have been warning about the increasing likelihood of a serious global trade war for quite some time.
That warning is now my baseline scenario. Unless there is an immediate deescalation of rhetoric and a return to rational thinking, a very destructive global trade war is baked in the cake.
I seek ways that a global trade war does not start, but I come up short.
Earlier this morning, Boeing’s shares dropped after United Continental Airlines said it would delay orders for 61 Boeing 737 jetliners, worth roughly $5 billion, and instead order the newer 737 MAX models for delivery in later years. Boeing, of course, downplayed the impact of the decision saying it would not affect its plan to increase production rates of 737s, and stressed that it continues to have orders for more 737s than it can produce.
Given that, it does seem to be curious timing that Boeing has just announced an operational restructuring that will result two site closures in El Paso, Texas and Newington, Virginia. While we’re sure there are “efficiency gains” to be generated from the consolidation of sites, cutting 4.5 million square feet of facility space in just 4 years seems like there may be a bit more behind the cuts.
A mock-up of a wide-body passenger aircraft jointly being developed by Moscow and Beijing has been presented at Airshow China. The new plane is expected to challenge the Airbus-Boeing duopoly.
Manufacturers Russia’s United Aircraft Corporation and Commercial Aircraft Corporation of China (COMAC) have announced the start of the search for suppliers. They didn’t provide any details on financing or technical specification.
From 2002 through early last year, the Pentagon conducted 11 flight tests of the nation’s homeland missile defense system. The interceptors failed to destroy their targets in six of the 11 tests — a record that has prompted independent experts to conclude the system cannot be relied on to foil a nuclear strike by North Korea or Iran. Yet, as The LA Times reports, over that same time span, Boeing, the Pentagon’s prime contractor, collected nearly $2 billion in performance bonuses for a job well done…
Furthermore, The Pentagon paid Boeing more than $21 billion total for managing the system during that period.
An LA Times investigation by David Willman also found that the criteria for the yearly bonuses were changed at some point to de-emphasize the importance of test results that demonstrate the system’s ability to intercept and destroy incoming warheads.
As part of the US economic slowdown, many have observed the sharp drop in demand for heavy trucking, coupled with the steep dropoff in train and intermodal traffic. Now, a third major red flag has emerged in the sky, where the slowdown in sales and new orders for airplanes is now so acute that US plane giatn, Boeing, announced on Monday it would refrain from increasing jetliner prices for the coming year, the first time it has held prices steady since 2009.
Now that Yellen has taken us back to square one where the worse the news, the better for assets, the latest announcement by Boeing, which overnight announced it will eliminate about 4,000 jobs in its commercial airplanes division by the middle of this year and another roughly 550 jobs in a division that conducts flight and lab tests, should help push the iconic ExIm bank-supported company’s shares to new 2016 highs.
According to Reuters, the planemaker will reduce 1,600 positions in the commercial airplanes division through voluntary layoffs, while the rest of the cuts are expected to be completed by leaving open positions unfilled, spokesman Doug Alder said.
Ten days ago, Delta CEO Richard Anderson sent shockwaves through the aviation industry when he announced he had just purchased a used Boeing 777 for the paltry price of $7.7 million. Here is the punchline: Boeing’s list price for a new 777-200ER is $277.3 million, meaning Delta is buying a used 777 at a price 97.2% lower than the value of a new 777.
The Republic of China Army Aviation (RoCAA; Taiwan) has extreme difficulties keeping its 29 new AH-64E Apache Guardian attack helicopters airborne. Part of the problem is a discovered material failure due to faulty production by Boeing.
H/t reader squodgy:
“Somebody thinks there’s a future….or is this for the elite?”
– Peak Crony Capitalism: First Citi Writes US Financial Laws, Now Boeing Tells Ex-Im Bank What To Do (ZeroHedge, March 13, 2015):
Today’s most under the radar news, just as Citigroup was to Congress, and the swaps push out language, so Boeing, that primary recipients of the generosity of America’s Export-Import (Ex-Im) Bank, has been caught red-handed drafting the rules of none other than the Ex-Im bank itself! According to the WSJ: “when the Export-Import Bank sought to respond to critics with tighter rules for aircraft sales, it reached out to a company with a vested interest in the outcome: Boeing Co., the biggest beneficiary of the bank’s assistance.” Or nothing more than a criminal conflict of interest, which, once again, is at the expense of America’s infinite bailout piggybank: it’s taxpayers.
– Army’s New Laser Cannon Blasts Drones Out of the Sky, Even in Fog (Wired, Sep 5, 2014):
Boeing is building a laser cannon for the U.S. Army, and the new weapon has now proved it will be as capable at sea as on land. The High Energy Laser Mobile Demonstrator (HEL MD)—basically a high-energy laser mounted on top of a big truck—was successfully used to blast some UAV drones and 60mm mortars out of the Florida sky earlier this year, Boeing announced Thursday.
– Boeing 787 Dreamliner planes in production found with ‘hairline cracks’ on wings says US firm (Independent, March 8, 2014):
Plane manufacturers Boeing said on Friday that “hairline cracks” had been discovered in the wings of about 40 787 Dreamliners that are currently in production.
The cracks are the latest trouble for the Dreamliner, a high-tech jet largely made of carbon-fiber composite that has been beset with so-called “teething issues” since entering service in 2011, three years behind schedule.
YouTube Added: Feb 25, 2014
Abby Martin remarks on a recent report by GoodJobsFirst.org which exposes the absurd amount of taxpayer money used to provide some of the wealthiest companies in the US with corporate welfare.
– “This Is Really A Symbol Of What’s Going On In This Whole Country. We’re Losing Middle-Class Jobs” (ZeroHedge, Nov 21,2013):
We wish we could say we didn’t warn Boeing’s machinists about the key trend taking place in the US economy under the Obama “recovery” but unfortunately we did. Three years ago, to be specific, when we wrote: “Charting America’s Transformation To A Part-Time Worker Society” and followed it up with “A “Quality Assessment” Of US Jobs Reveals The Ugliest Picture Yet” in which we explained that while the propaganda machine was fixated on numeric, quantitative, job additions every month, what has subversively going on, was the constant deterioration in the quality of jobs – and specifically the declining wages – available to those Americans who had not rotated outside of the labor force permanently (currently at a record 91.5 million). We say “alas” because it once again took several years before our cautions to be felt by the broader population, in this case the Boeing machinist union struggling to extract a wage increase from its employer: Boeing, whose stock keeps hitting new record highs with every passing day.
– Empty F-16 jet tested by Boeing and US Air Force (BBC News, Sep 24, 2013):
Boeing has revealed that it has retrofitted retired fighter jets to turn them into drones.
It said that one of the Lockheed Martin F-16 made a first flight with an empty cockpit last week.
Two US Air Force pilots controlled the plane from the ground as it flew from a Florida base to the Gulf of Mexico.