Boeing’s Wisk Investment Is Worrying For Three Reasons

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Here's why Boeing's Wisk investment is worrying:

Second, consider the market Boeing is pursuing instead. Actually, it’s not a market — It is a series of shiny objects in pursuit of a theoretical possibility. Literally hundreds of new AAM companies have been created, and all can be euphemistically termed “pre-revenue.” That is, there is no revenue. There is just a roughly $1 billion market for small turbine and piston civil helicopters that may, or may not, be disrupted by the possible arrival of AAM vehicles.that the AAM market is a mirage.

So, AAM may be a future possibility at best, and a dangerous diversion of resources at worst. But what’s Boeing’s rationale for this gamble? Does anyone at Boeing really think that its core business – jetliners flying hundreds of passengers thousands of miles – is going to be disrupted by small, slow, two- to four-seat vertical machines built for 20-minute flights?

This continues a dismal pattern of Boeing trying to leverage other people’s engineering. This pattern began with the near-catastrophic 787 outsourced development model. It continued with the disastrous loss of the U.S. Air Force strategic bomber contract, lost in part because Boeing submitted a bid using someone else’s design. Several other key defense contracts have leveraged other company’s design work, including the T-7 trainer and MH-139 helicopter.

It has been 18 years since the company launched an all-new clean-sheet jetliner, a record duration in the history of Boeing’s new product development. Given that, and the decline in engineering spending and headcount, it becomes just a matter of time before Boeing passes the point of no return, when it no longer has the people and capabilities necessary to design a new jetliner. This Wisk investment effectively hastens that terrible moment.

 

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