Success Is All In The Timing
Korean Air orders ten Boeing 787s
with an option on ten more. In just days, Northwest Airlines is
expected to order more than a billion dollars' worth of the next
generation aircraft. Boeing appears to be regaining ground lost to
Airbus in one of the world's most remarkable financial flip-flops
ever -- and it looks like it's all in the timing.
"Objectively, they've got the high ground right now," Airbus
sales chief John Leahy told the Chicago Tribune. "I wanted Korean
and Northwest.... I guess we screwed up."
Leahy's comments to the paper came as he learned Boeing
Commercial Aircraft sales honcho Alan Mulally had landed a lunch
meeting with Yang Ho Cho, CEO of Korean Air.
Getting that crucial lunch date with the CEO or a presentation
before the board of directors is just one battle in the $50 billion
war between Boeing and Airbus to sell commercial aircraft to the
world. Right now, Boeing has a firm target: stop the 787's chief
rival, the Airbus A350. The Korean Air and NWA deals might be
enough.
"They seem to be doing everything they can to stop the A350 from
being an industrial launch," Leahy told the Trib. "My job is to
make sure that doesn't happen."
The Chicago paper reports Mulally may actually have Leahy to
thank for his sales force's success. Over the past ten years,
Airbus' market share has increased 18-percent to top Boeing. As a
result, Boeing's sales staff has become more responsive to its
customers and the company itself is much quicker to decide on how
best to win the business.
Boeing Chairman Lewis Platt admits his company has been sluggish
and bureaucratic to respond to its customers. "We weren't
aggressive, we weren't visiting customers. We kind of just blew
them off."
So Boeing has a mission and a methodology. It also has deep
pockets. The key to the Northwest deal may be upfront financing on
Boeing's part.
"We'll be on top in terms of orders earned in 2005," Boeing's
new commercial sales chief Scott Carson promised the Tribune.
That's the kind of talk that makes Airbus' Leahy sit up and look
around. "When they say stuff like that, and they start to getting
very aggressive on pricing, all of a sudden you get to a situation
where these guys could really turn it around this year.
"Mulally has the ability to change things," Leahy continued. "He
gets an hour and a half, maybe two hours with the chairman of
Korean Air, and he can reach across the table and have a handshake
with the guy. That's damn near impossible for me to recover
from."
But if there is a reversal of fortune in the airliner wars,
Leahy's confident it won't last forever. This business, he said,
simply favors the underdog.