always argumentative, came back, “Yeah, but Boeing gets a lot of military contracts. That’s a form of subsidy, too, though they would deny it. I hate to see a foreign airliner on American routes, but maybe it will be good for competition.”
“Like you said, though, it’s going to be good for competition, but it’s going to be our competition, ActOn. I’ll bet O’Malley is on this like a herd of turtles, picking up contracts, making deals on both sides of the Atlantic. We’ll do pretty well with Pan American. They’ve ordered five hundred million dollars’ worth of Lockheed L-1011s, and we stand to clean up fitting out their interiors. That’s something even you have to give Rodriquez credit for, Tom, getting us into the business of doing the interiors of aircraft, not just their external equipment.”
Tom scowled. “I never said he wasn’t smart. But he sure wasn’t smart about telling us not to hire Mae. That crossed the line as far as I was concerned.”
Harry scoffed to himself. Rodriquez had crossed Tom’s line so many times in the past that the business with Mae was a trifle. Harry had honored his word: Vance Shannon, Incorporated, had not hired her, but Nancy had put her in charge of one of the residual businesses that was left over from the shopping mall debacle, and she was doing well. It was essentially a real estate office, but specializing in arranging mortgages and investigating titles. Mae had learned the business in six months, and was now operating on her own and was salvaging many of the properties that Nancy had given up on.
“Getting back to the L-1011s—you know the market is not big enough for it and the DC-10, too. McDonnell Douglas is already in trouble on the commercial side, and I don’t think the DC-9 can save them forever. The two companies should have merged and just produced one airplane or the other.”
Tom crumpled up the sheet of paper he had been writing on and tossed it in the wastepaper basket, saying, “Two points! They were way too proud for that. I think Douglas might have done it once, but Lockheed, never. But say they had pulled it off, they had merged, which one would you have wanted to see them build?”
Harry didn’t hesitate a second. “The L-1011. They call it the TriStar, you know, and it’s a much more modern aircraft than the DC-10. Douglas was in a hurry to catch up, and used way too muchDC-8 technology in the DC-10. Lockheed had been out of the commercial business so long that they could start with a clean sheet of paper. But they may be in trouble yet; the Rolls-Royce engine they chose is not coming along as it should.”
He paused for a gulp of water and went on. “You know, Tom, I feel badly about the whole deal. Some years ago I did an analysis for Boeing that showed clearly that the total market for a smaller wide-body airliner was about fifteen hundred aircraft. I wish now that I had made a stronger pitch on the subject to both Lockheed and Douglas management.”
“Harry, they wouldn’t have listened. They have a lot of smart guys in their marketing department, and there’s been a lot of competition between Lockheed and Douglas ever since the Connie was bucking the DC-6.”
“Yeah, but the big problem is that the breakeven point for either company was about 750 aircraft. So if they divide the market equally—which is probably what will happen—both are doomed to lose a bundle on the project. If one captures most of the market, it might make a little, but the other firm will be ruined. And Boeing is doing a much better job than anyone thought selling 747s, some to the very market that the L-1011 and DC-10 are aiming for. I still think if I could have gotten to their top management, I could have convinced them.”
“Spilt milk, Harry, forget about it. We’ve got a long way to go to get our own company on its feet, so stop worrying about those guys. We’ve never done as well on the commercial side as we have on the military side,
“Like you said, though, it’s going to be good for competition, but it’s going to be our competition, ActOn. I’ll bet O’Malley is on this like a herd of turtles, picking up contracts, making deals on both sides of the Atlantic. We’ll do pretty well with Pan American. They’ve ordered five hundred million dollars’ worth of Lockheed L-1011s, and we stand to clean up fitting out their interiors. That’s something even you have to give Rodriquez credit for, Tom, getting us into the business of doing the interiors of aircraft, not just their external equipment.”
Tom scowled. “I never said he wasn’t smart. But he sure wasn’t smart about telling us not to hire Mae. That crossed the line as far as I was concerned.”
Harry scoffed to himself. Rodriquez had crossed Tom’s line so many times in the past that the business with Mae was a trifle. Harry had honored his word: Vance Shannon, Incorporated, had not hired her, but Nancy had put her in charge of one of the residual businesses that was left over from the shopping mall debacle, and she was doing well. It was essentially a real estate office, but specializing in arranging mortgages and investigating titles. Mae had learned the business in six months, and was now operating on her own and was salvaging many of the properties that Nancy had given up on.
“Getting back to the L-1011s—you know the market is not big enough for it and the DC-10, too. McDonnell Douglas is already in trouble on the commercial side, and I don’t think the DC-9 can save them forever. The two companies should have merged and just produced one airplane or the other.”
Tom crumpled up the sheet of paper he had been writing on and tossed it in the wastepaper basket, saying, “Two points! They were way too proud for that. I think Douglas might have done it once, but Lockheed, never. But say they had pulled it off, they had merged, which one would you have wanted to see them build?”
Harry didn’t hesitate a second. “The L-1011. They call it the TriStar, you know, and it’s a much more modern aircraft than the DC-10. Douglas was in a hurry to catch up, and used way too muchDC-8 technology in the DC-10. Lockheed had been out of the commercial business so long that they could start with a clean sheet of paper. But they may be in trouble yet; the Rolls-Royce engine they chose is not coming along as it should.”
He paused for a gulp of water and went on. “You know, Tom, I feel badly about the whole deal. Some years ago I did an analysis for Boeing that showed clearly that the total market for a smaller wide-body airliner was about fifteen hundred aircraft. I wish now that I had made a stronger pitch on the subject to both Lockheed and Douglas management.”
“Harry, they wouldn’t have listened. They have a lot of smart guys in their marketing department, and there’s been a lot of competition between Lockheed and Douglas ever since the Connie was bucking the DC-6.”
“Yeah, but the big problem is that the breakeven point for either company was about 750 aircraft. So if they divide the market equally—which is probably what will happen—both are doomed to lose a bundle on the project. If one captures most of the market, it might make a little, but the other firm will be ruined. And Boeing is doing a much better job than anyone thought selling 747s, some to the very market that the L-1011 and DC-10 are aiming for. I still think if I could have gotten to their top management, I could have convinced them.”
“Spilt milk, Harry, forget about it. We’ve got a long way to go to get our own company on its feet, so stop worrying about those guys. We’ve never done as well on the commercial side as we have on the military side,
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