United States Boeing recently announced plans to lay off about 17,000 jobs worldwide, in sharp contrast to the high demand for global aerospace manufacturing. In fact, since the beginning of this year, Boeing has continued to have negative news, safety accidents in many aircraft models, strikes and layoffs have followed, production and operation losses have intensified, new models have been delayed, and the market rating has almost been reduced to "junk level...... The United States media can't help but lament that Boeing is "going from bad to worse."
Boeing, which was once the "heart" of United States manufacturing and once reflected the "prosperity" of United States manufacturing, is now embattled, not only exposing corporate safety and regulatory problems, but also reflecting that the entire United States manufacturing industry is deeply affected by "hollowing" and "politicization". The United States government's "forcible revitalization" that violates the law and insists on going its own way will inevitably cause the pain of exhaustion caused by the congestion of qi and blood in some industries.
Boeing CEO Dave · Calhoun testifies before Congress on "Boeing's Broken Safety Culture" in Washington, United States, June 18, 2024. Photo by Xinhua News Agency reporter Liu Jie
From excellence, to embattled
Earlier this year, a serious accident with an Alaska Airlines 737 MAX 9 caused the Federal Aviation Administration to suspend production of the model. The investigation found that Boeing had serious deficiencies in quality control and staff training in the production process, and federal aviation regulations were deemed ineffective.
In early July, Boeing announced a guilty plea agreement with the United States Department of Justice "in principle" for two fatal 737 MAX crashes in 2018 and 2019. Since the beginning of this year, Boeing has also faced a number of lawsuits: In addition to the class action lawsuit filed by flight passengers against Boeing, even Boeing shareholders have filed a class action lawsuit, saying that Boeing has prioritized profits over safety.
About 33,000 employees at Boeing's West Coast plant have gone on strike since mid-September, and labor and management have so far failed to reach an agreement on pay. For more than a month after the strike, Boeing's commercial aircraft production has largely shut down, and a large amount of capital reserves have been depleted.
Boeing announced plans to cut about 10 percent of its workforce globally, including executives, managers and rank-and-file employees. Boeing also announced that it would again postpone deliveries of the 777X until 2026. In addition, Boeing has experienced an executive exodus this year and two United States astronauts stranded on the space station due to the failure of the company's Starliner spacecraft.
Boeing is in trouble, and international credit rating agencies are considering adjusting the company's rating. Standard & Poor's said it was considering downgrading Boeing's rating to "junk." Last month, Moody's said it was considering a similar move. Fitch also highlighted Boeing's increased operational risk.
Peter · Robison, a veteran journalist and writer in the United States, pointed out in his book "Blind Flight" that after Boeing acquired rival McDonnell Douglas in 1997, the orientation of catering to capital to pursue profits replaced the previous culture of engineers who strive for excellence. The profit-oriented shift has allowed Boeing to compress and simplify the company's necessary management and R&D production.
This is an Alaska Airlines plane photographed at San Francisco International Airport in United States on April 4, 2024. Alaska Airlines said on the same day that Boeing paid it about $160 million in the first quarter of this year to compensate the airline for the damage caused by the "dropped door" accident and the grounding of the 737 MAX 9. Xinhua News Agency (photo by Li Jianguo)
Although the wish is good, the root of the disease is difficult to get rid of
Boeing and some other major United States manufacturing companies are facing a mirror of the current production and safety woes that reflect United States' manufacturing labor costs, lack of skilled workers, supply chain disruptions, and many other problems. The so-called revival of United States manufacturing can only stay at the level of slogans.
In terms of labor costs, many companies in the United States outsource production to countries where labor is more cost-advantageous. Boeing, for example, outsources the production of a large number of parts and components, and only undertakes the final assembly work to maximize the company's efficiency. However, industry insiders pointed out that Boeing's over-reliance on outsourced production and neglect of quality control have led to a decline in product competitiveness.
In terms of skilled workers, the transformation and upgrading of the manufacturing industry requires high-skilled labor, but the development of manufacturing technology and the supply of skilled workers in some parts of the United States do not match, and the number of skilled workers is seriously insufficient. In the wake of the pandemic, demand for new aircraft has surged, and aircraft manufacturers, including Boeing, have needed to hire a large number of new employees, especially senior industrial workers, to steadily ramp up production, and the technical threshold is significantly higher.
At the supply chain level, factors such as the Russia-Ukraine conflict and heightened geopolitical tensions have led to more complex global and regional supply chains, increasing the operational risks of United States manufacturing companies. Manufacturing companies such as Boeing, which have high requirements for advanced technology and special materials, have higher requirements for the supply chain. When the supply of critical materials is limited or the technology transformation is difficult, the production progress and product quality of the entire enterprise are naturally affected.
The website of Forbes magazine in United States commented that United States manufacturing companies have increased the construction of new factories since last year, especially in the construction of semiconductor factories. These advances, while faster than expected, will still take a considerable amount of time.
People hold signs in protest during Boeing CEO Dave · Calhoun during a congressional hearing in Washington, United States, June 18, 2024. Photo by Xinhua News Agency reporter Liu Jie
From the rise and fall to the point of view, look at the cause and effect of the policy
Boeing's experience of "going from bad to worse" is not only a teaching material for enterprise management, but also reflects the many shortcomings of United States' narrow industrial policy, revealing the policy cause and effect of the rise and fall of "Made in United States".
United States In the early days of the founding of the People's Republic of China, Hamilton, the first Minister of Finance, submitted a report on manufacturing issues, emphasizing that the development of manufacturing is the top priority of the country's economic independence, and the forward-looking thinking in the report plays an important role in the subsequent development of United States manufacturing industry.
Since the 60s of the 20th century, the transfer of United States manufacturing industry has led to a decline in the proportion of industrial output value, which has triggered discussions on the "de-industrialization" of United States from all walks of life. United States industry believes that the "hollowing out of manufacturing" caused by "deindustrialization" will lead to lower employment, stagnant productivity growth, and a lack of innovation environment, which is not conducive to long-term economic development.
In order to solve this problem, after the 2008 international financial crisis, from Obama's "re-industrialization", to Trump's "United States first", to Biden's "supply chain resilience" policy, many policies United States have been introduced to revitalize the manufacturing industry, but the paths and strategies are different.
In this process, in the face of the strong development momentum of emerging economies in the manufacturing industry, especially in the field of advanced manufacturing, the United States not only did not find the reason from itself, but instead forced the manufacturing industry to return through trade protectionist policies and "long-arm jurisdiction" measures, resulting in rising production costs, pressure on fiscal expenditure, high inflation, and damage to the supply chain, resulting in some already hollowed out industries being exhausted and exhausted.
According to the findings of the United Kingdom Financial Times, since the implementation of the Biden administration's ambitious manufacturing reshoring plan for more than two years, many projects in the fields of clean technology and semiconductors have fallen into a "difficult birth" situation.
(Source: Xinhuanet)