Western Railroad Discussion > Railroads and Competition

The head of the Federal Trade Commission weighed in on Boeing Company's corporate and operational shortcomings yesterday.  I think two of her observations are very relevant to railroads

• =17pxBoeing lost its innovative edge and quality fell amid reduced competition;
• =17pxManagement started to view the work force as a cost;
• =17pxBoeing became too big to fail, making it vulnerable to foreign governments seeking to influence U.S. policymaking

=17pxIt is interesting that she called out seeing the work force as a cost.  Rather than a skilled, expensively trained, highly experienced partner in producing quality aircraft.  Precisely the same issue that many railroads have today.  Find some way, any way, to get rid of experienced older workers and replace them with lower paid new workers. Better, outsource the whole process somewhere with low costs. Don't bother trying to create a new and better aircraft, just glue some new heavier engines on an old airframe and let the pilots and mechanics figure it out.

I suspect Joe Hinrichs at CSX (with a Ford manufacturing background) understands the issue.  I'm not sure that the other Class 1 leaders share that perspective.

?????

Bob

Posted from Android

Boeing is a manufacturer. Railroads are a service. I don't see the connection here.

One of the major difficulties with Boeing is the dedication to the primacy of the stockholder.  It began in the late 90s when a character named Shrontz (sp?) was brought in not with the intent to improve or innovate, but to get the stock price to a higher level.  When money seems to matter more than engineering, trouble looms and that's exactly what we're seeing today.  By the way, Schrontz got the stock price up, pocketed a huge...HUGE...bonus which he announced at a press conference.  About the same time, the IAM had exchanged contract openers with the company and Schrontz called another press conference at which he was quoted as saying, "These people are going to hav3 to pay fr their medical coverage!"  With that, the IAM walked out and the ensuing strike nearly destroyed the company.   Primacy of "investors" will be the ruin of a once-fine engineering operation that is now wallowing in stupid.

The connection is in PSR, financial results...primacy of the investor, is the guidepost, not service to customers.  Same thing at Boeing but in a different industry.

*Let me add one more edit.  The two MAX accidents, one in Indonesia and the other in Africa were only periferily a Boeing misstep.  In Indonesia, the crew failed completely to recognize a small issue and allowed it to cascade into a tragedy.  This is something at which airplanes are very practiced.   It was a similar situation in Africa and I have maintained from the very beginning that inept crews were largely to blame fr both of those accidents.

By the way...nearly 15 years of flying all the 737s from the -100 to the -700NG, and I do not agree that here was any "tacking on" at all.  Just like the Ford Mustang that originally had a 200 cubic inc six to the current 500 horsepower monster...innovation, improvement and capability.  Same with the 737...even the MAX.



Edited 3 time(s). Last edit at 06/18/24 16:05 by a737flyer.

Lackawanna484 Wrote:
-------------------------------------------------------
> The head of the Federal Trade Commission weighed
> in on Boeing Company's corporate and operational
> shortcomings yesterday. 

Day late and dollars short.

> I think two of her
> observations are very relevant to railroads

You listed three, but who is counting.

• =17pxBoeing lost its innovative edge and
  > quality fell amid reduced competition;

Standard global commercial status: Less competition equals less choice and less drive to innovate. US Railroads fit very nice and snug in that description.

• =17pxManagement started to view the work force
  > as a cost;

Today's standard investor driven policy. Decisions are based upon boosting profit. Producing a quality product or providing a quality service no longer matter. US Railroads are deep into that mentality.

• =17pxBoeing became too big to fail, making it
  > vulnerable to foreign governments seeking to
  > influence U.S. policymaking

See detailed posts about the Boeing 737 MAX debacle that started mid 2010 with direct influence by the federal government. US Railroads fit nicely in that description since they own the underlying infrastructure, whereas across the globe the countries with great railroads, both passenger and freight, have the infrastructure government owned and/or controlled.

DutchDragon Wrote:
-------------------------------------------------------
> Boeing is a manufacturer. Railroads are a service.
> I don't see the connection here.

Both are dedicated to increasing profit. Quality of service or product provided/produced is no longer important.

a737flyer Wrote:
-------------------------------------------------------
> One of the major difficulties with Boeing is the
> dedication to the primacy of the stockholder.  It
> began in the late 90s when a character named
> Shrontz (sp?) was brought in not with the intent
> to improve or innovate, but to get the stock price
> to a higher level.  When money seems to matter
> more than engineering, trouble looms and that's
> exactly what we're seeing today.  By the way,
> Schrontz got the stock price up, pocketed a
> huge...HUGE...bonus which he announced at a press
> conference.  About the same time, the IAM had
> exchanged contract openers with the company and
> Schrontz called another press conference at which
> he was quoted as saying, "These people are going
> to hav3 to pay fr their medical coverage!"  With
> that, the IAM walked out and the ensuing strike
> nearly destroyed the company.   Primacy of
> "investors" will be the ruin of a once-fine
> engineering operation that is now wallowing in
> stupid.
>
> The connection is in PSR, financial
> results...primacy of the investor, is the
> guidepost, not service to customers.  Same thing
> at Boeing but in a different industry.
>
> By the way...nearly 15 years of flying all the
> 737s from the -100 to the -700NG, and I do not
> agree that here was any "tacking on" at all.
>  Just like the Ford Mustang that originally had a
> 200 cubic inc six to the current 500 horsepower
> monster...innovation, improvement and capability.
>  Same with the 737...even the MAX.

Glad to see your post take care of everything and about the 73 series you are so right. Watched the progression of the 72,73,-80 four engine serise and even saw the simualted 74 cockpit racing up and down BFI powered by a GMC truck from the nose dock where I worked.

Lackawanna484 Wrote:
-------------------------------------------------------
>

• Boeing lost its innovative edge and quality fell amid reduced competition;
• Management started to view the work force as a cost;
• Boeing became too big to fail, making it vulnerable to foreign governments seeking to influence U.S. policymaking.

I suppose merger/loss of competition like McDonnell Douglas and Lockheed might be a factor, but competition has always existed, called Airbus. Boeing did just fine until recent years, and Boeing 737 MAX crashes (mentioned by longliveSP above) being the first overt signs of the problem.

I think the second point is the BIGGEST factor. How about that "software can fix everything" mentality that was a shortcut to avoid the new certification process for the Boeing 737MAX? That idiocy continues today with the Artificial Intelligence hype, and the thankful collapse of the self-driving "industry." That's what happens when sociopaths run organizations and distrust/oppress fellow human beings, like the workforce.

Wall Street's money-only mentality attracts and promotes these sociopaths to climb the corporate ladder. So all "innovations" are financial, and real technical/engineering innovations are limited to what makes money, so they become mediocre. So it should be obvious that Boeing's current problems, rushing production to meet unrealistic deadlines to satisfy quarterly reports lead to quality control issues.

Mentioning the railroads to make this an "on topic" discussion is understandable, but in the current climate where those who want to fix the problems are silenced (censorship, mysterious accidents to whistleblowers, etc), FTC is just doing lip service. This is a popcorn moment, where only thing we the peons can do are to protect ourselves.

cchan006 Wrote:
-------------------------------------------------------
> Lackawanna484 Wrote:
> --------------------------------------------------
> -----
> >
>
>

• Boeing lost its innovative edge and quality
  > fell amid reduced competition;
  >
• Management started to view the work force as a
  > cost;
  >
• Boeing became too big to fail, making
  > it vulnerable to foreign governments seeking
  > to influence U.S. policymaking.
  >
  > I suppose merger/loss of competition like
  > McDonnell Douglas and Lockheed might be a factor,
  > but competition has always existed, called Airbus.
  > Boeing did just fine until recent years, and
  > Boeing 737 MAX crashes (mentioned by longliveSP
  > above) being the first overt signs of the
  > problem.
  >
  > I think the second point is the BIGGEST factor.
  > How about that "software can fix everything"
  > mentality that was a shortcut to avoid the new
  > certification process for the Boeing 737MAX? That
  > idiocy continues today with the Artificial
  > Intelligence hype, and the thankful collapse of
  > the self-driving "industry." That's what happens
  > when sociopaths run organizations and
  > distrust/oppress fellow human beings, like the
  > workforce.
  >
  > Wall Street's money-only mentality attracts and
  > promotes these sociopaths to climb the corporate
  > ladder. So all "innovations" are financial, and
  > real technical/engineering innovations are limited
  > to what makes money, so they become mediocre. So
  > it should be obvious that Boeing's current
  > problems, rushing production to meet unrealistic
  > deadlines to satisfy quarterly reports lead to
  > quality control issues.
  >
  > Mentioning the railroads to make this an "on
  > topic" discussion is understandable, but in the
  > current climate where those who want to fix the
  > problems are silenced (censorship, mysterious
  > accidents to whistleblowers, etc), FTC is just
  > doing lip service. This is a popcorn moment, where
  > only thing we the peons can do are to protect
  > ourselves.
•  
• And here we go with the boogy man deal really?  You are right its a popcorn comment at the best software has solved many problems with aircraft and made it safer fighters have used it for many years nothing new about that. Put your tin hat on please.

Worker skill vs compensation vs Corporate balance including Shareholder expectations is very relevent to both industries and much of the Business World in the USA. There was a story somewhere about the older skilled Boeing workers aging out which is part of the idea of out sourcing the Airplane body or sub-assemblies to other manufacturers.

Not so much a tin hat issue but simply number of workers in an area, which does get into Cost of living in Western Washington State vs Kansas or almost any other State. Plemty of States agressively attract big projects like the Aerospace industry, which has a unique set of skills. Airframe and Power Plant Qualifications are a serious skill but the market is often undermined to reduce Labor costs, that tin hat conspiracy once again.

Thanks to all contributors for an excellent discussion (mostly).
In my opinion many of the failings of RRs and apparently of Boeing are due to investment capitalism taken to extremes.

           So to understand anything of this, Who or What is ' =17px ' ??? What does this person or machine do ?

dcfbalcoS1 Wrote:
-------------------------------------------------------
>            So to understand anything of
> this, Who or What is ' =17px ' ??? What does this
> person or machine do ?

Probably the most coherent part of the post. !!!!!!

Possibly 17 pixel indent for the bullet indent picked up in the copy and paste but that is a wild guess.
But someone told me there is a bunch of old guys here.  When I read about railroad problems I guess they forgot about th 70's. 

Bob

What is ' =17px ' ???

Yep, copied and paste from some other format. That's the font size of the text being pasted, the user doesn't see that info until after the post is made on TO. Done it many times.

It could be copied from 3rd party source, like a news story, or from a FB et al source. or original text from the user's Notepad, or Apple version. For some reason folks are afraid to edit their posts, perhaps suggesting they changed their mind. However, the edit has it's own timestamp and a edit comment could be made.

TCnR Wrote:
-------------------------------------------------------
> What is ' =17px ' ???
>
> Yep, copied and paste from some other format.
> That's the font size of the text being pasted, the
> user doesn't see that info until after the post is
> made on TO. Done it many times.

Yet, there is a wonderful feature that so many people ignore, the preview feature.

And woefully inadequate regulation of the financial industry, Boeing and the railroads.

BAB Wrote:
-------------------------------------------------------
> And here we go with the boogy man deal
> really?  You are right its a popcorn comment at
> the best software has solved many problems with
> aircraft and made it safer fighters have used it
> for many years nothing new about that.

Just because software was used properly in the past doesn't mean the same is happening now.

> Put your tin hat on please.

Put on your dunce cap, please.
 

When I was a travel agent, Airbus had a few accidents and some regular clients started saying, "If it ain't Boeing, I ain't going!"  Some might be changing it to, "If it's Boeing, I ain't going!"

mapboy

railstiesballast Wrote:
-------------------------------------------------------
> Thanks to all contributors for an excellent
> discussion (mostly).
> In my opinion many of the failings of RRs and
> apparently of Boeing are due to investment
> capitalism taken to extremes.

In my view it's more the lack of competition that allows companies to get this way.   The USG allowed Boeing to scoop up McDonnell Douglas and leave it as the only large manufacturer in America, only to compete with the subsidized Airbus.   They allowed the RRs to consolidate similarly.  With vigorous competition you have to create the best, safest and price competitive widget to stay in business.   Investors can still make a lot of money betting on the winner.  

mapboy Wrote:
-------------------------------------------------------
> When I was a travel agent, Airbus had a few
> accidents and some regular clients started saying,
> "If it ain't Boeing, I ain't going!"  Some might
> be changing it to, "If it's Boeing, I ain't
> going!"
>
> mapboy

Those crashes was the reason Airbus got tagged with "Scarebus".