Book Review : Air Wars – The Global Combat between Airbus and Boeing

“Air Wars – The Global Combat between Airbus and Boeing” is a 238 page paperback book (7″ x 10″), also available as a Kindle eBook.  The print version lists for $24.95 and the Kindle version for $9.99.  Both are of course on Amazon, and the prices may change from time to time (currently the print version is $22.68).

This book’s title promises a broad look at the competition (or, as the author says, “global combat”) between Airbus and Boeing.  It evolved from an original concept that was to be a biography (or perhaps autobiography) of John Leahy – Airbus’ head salesman and his 33 years heading their sales efforts between 1985 and 2018.

This was certainly an extraordinary and very interesting 33 years.  It saw Airbus (founded in 1970, and with its first plane, the A300, entering commercial service in late 1974) go from an insignificant player to, by several measures, market leader.  Leahy’s time with Airbus started at about the same time that Lockheed stopped selling passenger planes (1983), continued through the demise of McDonnell Douglas (1997), the collapse of the Soviet aircraft industry, the rise of the nascent Chinese aircraft industry, the end of Concorde in 2003 (with still nothing to replace it), and so much more.

In other words, author Scott Hamilton has a lot to write about – almost too much, as he says himself in his acknowledgements.  Is it possible to reduce the complexity and vastness of the subject into something that is simultaneously readable but also reasonably thorough?  That’s a very delicate balancing act, and by the end of the book, Hamilton was obviously correct in saying the topic was almost overly broad.

There are elements of the book that could be looked at in more depth and would be worthy of their own sizeable books.  The obvious example that everyone would think of is the 737 MAX problems, crashes, grounding, resolution, and final outcome (to say nothing of a similar book on the 787 program – the astounding delays, problems, cost-overruns, and then the battery fires, grounding, and resolution).  Another book subject, less obvious to people who aren’t close watchers of the industry, is Boeing’s incredible dithering and inability to come up with a replacement for its former 757/767 planes (a gross over-simplification of the complex challenge Boeing keeps shying away from solving, but I don’t want to make this review into a book, also!).

Hamilton uses these two major factors (the 737 MAX and 757/767 replacement) as structural underpinning for the entire book.  Is it ironic that a book originally planned as revolving around Airbus and its long-serving head of sales ended up doing a deeper dive into Boeing issues?

I knew I was going to enjoy the book because I started learning new things right from first opening the book and reading the first sentence.  Who knew that Boeing’s founder was first a logger?  Not me.  Mind you, to describe William E Boeing as a logger is a bit like describing another famous son of Seattle, Jeff Bezos, as a bookseller.

Hamilton’s in-depth knowledge shines through, in minor points such as Mr Boeing’s background, and in more major points where he shares so much of the “behind the scenes” glimpses and commentary that he is almost uniquely qualified to give.  He has been covering the aviation and aerospace industry full-time since 1985 as both a journalist and analyst with a broadly read and respected newsletter (some content is free and the rest is paywalled), and as a general industry thought-leader.

Unlike some who cover the aviation field, Hamilton has always been independent and unswayed by corporate fluff and PR, and has never hesitated to disagree with what the major aerospace companies would prefer to see accepted unquestioningly.  His independence and intelligence has gained him the respect of the “great and the good” of the industry, as evidenced by the large number of sources who helped him with insight, off-the-record background, and on-the-record specifics, making the book detailed, accurate, and accountable.

After a whirlwind introduction to the industry, flashing from 1916 to the late 1990s in half a dozen pages, we’re suddenly dropped into the middle of it all, 2010 and one of the biggest issues confronting both Airbus and Boeing, with the stakes higher than any previous issues – what to do with their respective “bread and butter” mainstay product lines – the A320 (ceo) and 737 (NG).  This is a point Hamilton keeps returning to throughout the book – almost frustratingly so.  It would be nice to see the entirety of this issue holistically picked apart (if that’s not an oxymoron) in one place, but the topic benefits from the context and background that he adds in other interleaved chapters.

Hamilton is spot on in his assessment of the quandary the two manufacturers were stuck with in 2010.  Should they upgrade their current model series, or should they develop entirely new series of planes?  I wrote a four part series on this back in December 2010, and have discussed the subject in many other articles, both before and since.

The decision for each company was massively colored by trying to guess at what the other company would do.  Being the first to announce their plans offered some potential “first mover” benefits, but also meant the other company had a chance to then wrong-foot the first company’s announcement with a plane that one-upped the earlier announced plane.  There were other issues too, beyond the immediacy of the 737 vs A320 challenge – it truly was a game of corporate chess with many different pieces on the board.  For example, one of the many considerations for Airbus was how to slow down Boeing’s development of a replacement to the 757/767 models, too.  As Hamilton correctly says, the first company to announce their plans was making a multi-billion dollar gamble.

Airbus was first to announce its upgraded (mainly by re-engining) A320 series, the A320neo, on 1 December, 2010.  For an astonishing seven long months subsequent to that announcement, Boeing prevaricated about how to respond – should it re-engine the 737 – a quick and low-cost approach, or should it spend more money and take longer to develop an entirely new family of planes?

But what Hamilton doesn’t – can’t – tell us is what was Boeing doing for every one of the 272 days between the Airbus announcement of the A320neo and the American Airlines A320neo order that forced Boeing to make a decision and formally announce the 737 MAX on 30 August, 2011?  During that extraordinary period of inactivity, Boeing was losing market share and plane orders on almost a weekly basis, but seemed locked in an agony of indecision and inability to decide.  Amazingly, and underscoring how Boeing’s problem was – at its heart – simply an inability to decide, when American finally gave an ultimatum to Boeing, the company was able to respond, with the 737 MAX concept, within 48 hours.

Perhaps the reason Hamilton doesn’t give us a day by day chronicle of Boeing’s indecision is how boring it would be; a series of “nothing happened today” entries for day after day after day, while at the same time, Airbus was happily ringing up some 1,300 orders for its A320neo planes.  What ever happened to the once brave Boeing, willing to “bet the company” on bold new ventures such as the 707 and 747?  A topic for another book, I guess.

Hamilton certainly makes good on his promise to cover a great deal, but does so in a series of passes through the industry and timelines, and leaves some parts disconnected or overlooked, and I often found myself wishing he’d written the longer book he was avoiding.  The coverage also jumps and shifts focus.  For example, chapter 14, about Boeing’s problems with its unions (some would say that is better phrased as “the unions’ problems with Boeing”) stops at an inconclusive point and chapter 15 introduces us to Bombardier and their C Series development, only to end prior to the plane’s release, and switching in chapter 16 to the Airbus project to develop the A320neo, something that had been regularly touched on already (but never fully developed).

However, within this seemingly unconnected series of jumps lies a fascinating revelation – Hamilton suggests the driving force for the re-engining of the A320 series into the A320neo was not in anticipation of Boeing’s next move with its 737 series, but rather in response to the pressure from Bombardier’s C Series (especially the CS300).  I did not know that.

Another out of sequence thing was how the start of chapter 22 refers to “Airbus continued to have the the overhang of the bribery investigation and the disruptions within”.  There was another mention of this bribery investigation in chapter 24 and 25.  But the bribery investigation isn’t explained until later in chapter 25 (and doesn’t appear in the index, in case you wanted to try and find out what was being referred to).

People appear and disappear in the book.  For example, near the end, on page 235 a quote is attributed to Gary Scott.  Who is he?  The cast of characters section doesn’t have him included, but fortunately the index does (although it omits including the page 235 mention).  He was introduced way back on page 119, and referred to again in passing on page 155; readers could be excused for forgetting who he is by page 235.

I’d also like to have seen acronyms spelled out in full more often.  Some even appeared for the first time without explanation.  It can be hard, for someone who lives a subject, all day every day, to remember that not everyone else has the same depth of knowledge and familiarity with the industry’s jargon, and while it might seem to slow down the narrative to be including people’s titles/positions and the meanings of acronyms, many readers will greatly appreciate this.

The sequential problems are probably inevitable because of the way Hamilton writes by topic rather than by year, but could be easily handled by adding footnoted cross-references.  The out-of-sequence jumping makes it harder for a casual reader to go through a section or chapter and feel, at the conclusion of the section/chapter, they have been given all that Hamilton has to share on the particular topic.  There’s a good chance there will be new material appearing in other parts of the book, too.  This is not a book with a series of self-contained chapters that you can read individually.  It greatly benefits from being read steadily right through from start to finish.

Does this mean the book is only for industry insiders?  Can “ordinary people” – people interested in understanding an industry that impacts on their all-too-frequent travels – also understand and enjoy it, too?  There are some cases where Hamilton assumes more information than non-insiders might have at their fingertips, but these are infrequent and don’t detract from the narrative.  It might have been an idea to add, as well as the “Cast of Characters” (people, not planes) and time-line of airplane introductions, also a glossary of terms, abbreviations, and a quick reference to airplane types and their key attributes.

This airplane release timeline is incomplete.  For example, with the 747, it gives dates for the entry-into-service of the -100, -400, and -8I.  It is silent on all the other models, including the obvious -200, -SP, and -300, and also less well known variants such as the Combi, the -400ER, and many other successively more minor variants.  It could be argued the other variants were not as pivotal as these three, but why not add at least some of them to make the table more definitive.

It also only tells us when an airplane entered service, but what was the significance of the plane, and how was it better than its successors?  When did it cease production?  What competitive gap was opened or closed as plane models were launched and subsequently retired?  The book does have an index, which is helpful, and also 112 footnotes.

I did find one surprising error.  Hamilton describes ETOPS as allowing planes to be as far as 240 minutes from the nearest airport.  That limit, first allowed in 2009 with the A330, and a key part of the demise (failure) of the A340, has long since been increased.  In 2011, the 777 received an engine-dependent rating for 330 minutes, and in 2014, the 787 received the same rating.  The same year saw the A350 being granted a 370 minute rating right from its first flight.  I believe the 370 minute rating (6 hours and 10 minutes) remains the longest ETOPS rating currently in existence, and is unlikely to grow much further, because essentially the entire planet can be flown without getting more than 370 minutes away from a suitable airport to land at in an emergency.

What the book doesn’t have at all are any photographs, nor any charts, graphs, or other visuals.  For those of us increasingly treated to lavish servings of “eye candy” in the content we consume, this is disappointing.

With the overarching concept of the book being the competitive struggle between Boeing and Airbus, it might have been very helpful to have some tables or charts showing how their respective market shares rose and fell, or showing the varying market shares the two companies had.  For that matter, the concept and measurement of “market share” is never fully explained, which is disappointing, because in itself it is an interesting and surprisingly subjective topic.

Simplistically, market share might refer to annual sales or annual deliveries, but even that is complicated – is it fair to just count planes without distinguishing between small and big planes, expensive and inexpensive planes?  So should market share be modified by plane type/size?  Or measured by dollars rather than planes?  Or perhaps by the total seats on all the planes sold?  Another approach is to count the sizes of already delivered and currently operational planes, although this of course is a very slow-moving measure.  Still another approach is to look at the sizes of the unfilled orders held by both companies, maybe measured by planes or by dollars, but this is a very tricky measure, due to when an order is viewed as “real” and how to treat weaker “letters of intent” or “memorandums of understanding”, and how to adjust for orders that clearly will never proceed due to the state of the airline customer.

For a book about business warfare and combat, it is very silent on who won what, and by how much.  This is regrettable because the winners and losers are not always apparent, neither at the time, nor even in the future, because of the complicated series of overlapping “battles” being waged simultaneously, and because anything either company does usually comes at the cost of some other thing the company can not concurrently do, because of finite funding and also only so-many staff in engineering and R&D type roles.

Here’s a simple chart I created to show both annual sales and annual deliveries for the two companies, using the data on this page of my site.  The numbers are not 100% guaranteed, because the earlier years of data I was able to obtain is less accurate and sometimes incomplete, but 2000 forward is probably exact.  As you can see, I have delivery data going back to the start of Airbus deliveries in 1974, but sales data doesn’t reach all that way back.

Because there are often end of year anomalies that make one year unusually high and the next unusually low, I used a running two year average to more fairly show the numbers.

It is not altogether clear from any of the lines on that chart who is clearly winning and who is clearly losing.  But, in part, that is almost by design.  It is not in the interests of either the two players nor the airlines to see one of the (usually) only two suppliers too weakened.

Hamilton touches on this when he refers to Leahy setting a 50% market share goal, and not wanting to grow much over 60% or shrink much below 40%; what would be interesting is how this has colored the thinking of both manufacturers.  Are there examples of them deliberately moderating their product development so as not to knock out the other company?  Similarly, are there examples of airlines choosing to give orders to both suppliers primarily to keep both suppliers healthy?  What happened to Boeing’s desire to create sole-supplier contracts with airlines – Hamilton gives us some of the history of this, but what is the present day status?  Does Airbus have any sole-supplier contracts too?

Other unanswered questions also exist.  For example, why didn’t China buy more than five A380s?  Why/how did Airbus allow the A380 to launch with already out-of-date engine technology, thereby handicapping its cost per seat mile and cost per flight numbers (and never get the engines updated)?  Could the A380 have been more commercially successful with better engines (I believe definitely yes, but conventional wisdom seems to overlook this issue)?  What was the outcome of the Boeing/Embraer arbitration over Boeing walking away from the deal to buy Embraer?

Obviously, at the end of the book, I still wanted more, and that’s in part just me being demanding and fascinated by the entirety of what is a huge subject.  I need to learn to see my glass as half full, with all the fascinating detail that Hamilton provided, rather than bemoan the omission of still more.

I also wanted more about Leahy – how, specifically, was he so great?  What exactly were his unique contributions to Airbus and the industry that someone else wouldn’t have offered up in his place?  Nearing the end, on page 226, Hamilton says in partial summing up

The next 35 years will offer similar challenges, but it’s unlikely there will be another Leahy for Airbus or another Conner for Boeing—whom Leahy called his toughest competitor—that will have the same level of influence.

But he doesn’t explain why he says that.  It seems that even the largest companies tend to be shaped and dominated by a few outstanding individuals.  Hamilton returns to this concept on page 235.  He tells us

As Leahy prepared to retire, whoever would replace him couldn’t possibly fill his shoes. His personality, his drive and his legend simply could not be matched.

Color me unpersuaded on that point.  I don’t want an empty hagiography.  I want a searching analysis.  There’s no clear recitation of events where Leahy was primarily the moving force and responsible for major outcomes.  His impact, variously on Airbus, Boeing, and the aviation market in general, is never made clear.

Hamilton tells us that Leahy was responsible for growing Airbus’ market share from a low number (unstated, but elsewhere in the book is a claim, attributed to Leahy, that Airbus had an 18% share in 1995, with a target to grow to 50% by 2000) to 50% or more.  But how much of this was purely because of Leahy, and not something anyone else would have also done?  What did Leahy uniquely do that others couldn’t have readily done in his place?  How many of the Leahy/Airbus successes were actually due to Boeing blunders?  Can any “full service” company that designs, builds, sells and maintains planes really single out one individual from the 130,000 employees as the primary person responsible for the largest part of the company’s success?  And, if they can, why can’t they continue to do so, in the future?

Overall, the Leahy side of the book was lighter than expected.  There were few personal details.  What were (are) his hobbies?  What sort of food does he eat?  How about his home life?  There wasn’t even all that much business detail – I had hoped to better understand who the real decision-makers are at Airbus.  Did marketing (ie Leahy) get to dictate the types of planes it wanted, or did production get to dictate the types of planes it would make?  How was (is) this classic tension balanced?  When was Leahy stymied, how and why, in having his preferences accepted?  Did he make any spectacular blunders?  What pivotal moments in Airbus’ evolution and growth were directly attributable only to Leahy?  Was he a workaholic?

Or even details such as how much was he paid?  Did he get a commission on sales?  Was he earning mega-millions from his successes?  How did his rate of pay compare to more senior staff in the company?  To people in similar positions at Boeing?

It would be nice to have an appreciation of Leahy’s contributions (and an admission of his mistakes), offered up with the benefit now of 3 1/2 years of hindsight.  A definitive biography (or autobiography) of Leahy still awaits us.  A topic for perhaps another book – Leahy, the man vs the legend.

There was one other topic I’d have liked more on, as well.  The book is framed as reporting on a two way struggle between Boeing and Airbus, and fairly delivers on that promise, adding, as bonus, extensive coverage of Bombardier and its eventual (partial) acquisition by Airbus, plus Embraer and its eventual non-acquisition by Boeing.

It might have been interesting to include some coverage of the other “bit players” in this drama – what happened in Russia to collapse their aerospace industry so totally and will it revive, the surprising apparent and extended failure of the Japanese and Mitsubishi in particular to enter the market, and – most of all – what is currently happening and expected to happen in China?  To dismissively refer to both the ARJ21 and C919 as totally uncompetitive ignores the reality that, competitive or not, they are being ordered by the Chinese (200 of the small ARJ21 that is probably too small to directly compete with Airbus/Boeing, and somewhere between 169 and 971 of the C919 which is a direct A320/737 competitor), and those orders of course represent planes not sold by Airbus or Boeing.  With China growing its international footprint, it seems inevitable it will encourage its client nations to start buying Chinese airplanes, too.

Please excuse the quibbles I make above.  Perhaps I’ve fallen victim to the temptation to attempt, as a reviewer, to show that one is at least as clever and knowledgeable as the writer.  That would surely be an exercise in futility – Scott Hamilton has an encyclopedic and first hand knowledge of the aerospace industry that I could never equal.  My comments are requests for more, rather than criticisms of what is included.  It’s all good, in terms of content.

In other words, happily, there is plenty for Scott Hamilton to add into a second book.  I hope he does indeed continue to share his wisdom with us all, and commend his first book to you now.

ps :  If you liked this book, you might also enjoy an earlier book, “Boeing vs Airbus”, published in 2007.  I review it here.

 

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