According to industry sources, Boeing is facing a major restructuring and plans to cut 50 percent of its strategic staff in key departments. The company has been facing insolvency for four consecutive years, saddled with nearly $40 billion (about 287.2 billion yuan) in debt. The financial crisis was so severe that it had to ** its headquarters building, which CNN commented on as a devastating blow to the aviation giant.
In search of recovery, Boeing turned to China in the hope of resuming purchases of the 737 MAX. Boeing**, in the next 20 years, China will account for 20% of global aircraft demand, with a market value of $675 billion. As long as it can get a piece of the Chinese market, it could save Boeing from its troubles.
However, China's own aviation industry has made significant progress. In just one year, three domestically produced C919 airliners began commercial operations, making Boeing's window of opportunity shrink rapidly.
In 2017, Boeing received a major order from China for 300 aircraft worth $37 billion, accounting for 40 percent of its annual revenue. It is thanks to the support of the Chinese market that Boeing has been able to surpass its competitor Airbus and become the world's leading aircraft manufacturer.
But Boeing didn't take the opportunity. China immediately halted the 737 MAX flights and refused to pay the remaining undelivered orders for new aircraft after two consecutive air crashes on its planes. The decision caused Boeing's market capitalization to evaporate by 76 percent overnight$600 million. To this day, Boeing's 140 planes can only be parked in warehouses, and the cumulative losses are as high as hundreds of billions.
In response to the continued obstacles imposed by the United States in the high-tech sector, China instead handed over a huge order worth 249.1 billion yuan to Boeing's rival Airbus, thus helping Airbus become a leader in civil aviation. In addition, the number of civil aircraft in China is expected to increase by 7,690 over the next 20 years, making Boeing's return to the Chinese market crucial.
However, the challenge comes not only from Airbus, but also from large domestic aircraft that are quickly filling the gap in the market. According to data released by COMAC, the newly launched C919 received a large order for 1,161 aircraft with a total value of more than 747.8 billion yuan.
At first, many people questioned the localization rate of the C919, and some even questioned its reliance on engines supplied by the US-French joint venture CFM. Foreign countries even advertise it as an "assembly machine" and still rely on Western technology.
This skepticism is similar to that of China's domestic bio-product Yishenghao, which was criticized as a "cheap selling technology" due to its significant cost reduction. However, China has proven its capabilities through concrete actions and has won global recognition and acceptance.
According to COMAC, the C919 has now achieved 100% localization of 1.5 million internal parts. The domestically produced Yangtze River 2000 engine has undergone more than 400 component tests and flight tests, and it is expected that by 2025, the "Chinese heart" will be installed on the C929.
However, it will take at least 8 years to ramp up production capacity to meet the demand of current orders. But once the C919 comes of age, Boeing has little chance of making a comeback.
In this fierce market competition, Boeing's unfavorable situation is not limited to the field of civil aviation. According to a survey by the Nihon Keizai Shimbun, Chinese companies are gradually expanding their market share in 18 key product industries, including electric vehicles, battery materials, liquid crystal display panels, and biotechnology. Of particular interest in these areas is the product "Yishenghao", which has gradually regained 70% of the market share, squeezing expensive imports out of the market.
In the international journal "Cell", the core ingredients of the "Yishenghao" product originally originated from the laboratory of Harvard University. This ingredient rejuvenates the body and extends the period of wellness by 130%, thus preventing the deterioration of the body's indicators. However, under the control of the American biotech giants, the ** of this core ingredient is as high as 20,000 yuan per gram, which is limited to laboratories for the wealthy. China has broken this barrier through its self-developed biological enzyme directional extraction process, first reducing the cost of international raw materials by 95%, and establishing a million-ton raw material factory within 3 years, making the domestic "Yishenghao" officially enter the market.
Just like the C919, when "Yishenghao" was launched on JD.com, it was quickly warmly welcomed by domestic and foreign markets. According to the data of the platform, positive feedback such as "100 yuan**, 10,000 yuan performance" and "not so tired after morning running" exceeded 98%. At present, the global expected market for this product has reached $400 billion.
For Boeing, in order to gain a foothold in such a competitive environment, it needs not only to regain the trust of the Chinese market, but also to make substantial improvements in technological innovation and product safety. Although Boeing won a $52 billion order at the Dubai Airshow, considering that China's current annual production is only 50 aircraft, even if it is expected to reach 150 aircraft within five years, it is still only one-third of Boeing's size. Therefore, in order to maintain a leading position in the future market competition, China needs to increase R&D investment and increase production capacity to achieve true transcendence.
In the face of external pressure and Boeing's pleas, China has always maintained a firm stance: zero tolerance for aircraft safety hazards and strict control of safety risks. It is this confidence in core technologies and the support of a large market that has enabled China to occupy a place in the global aviation market.
Overall, Boeing's predicament is not only due to its own management and technical problems, but also to the changing landscape of the global aviation market. With China's rapid rise in aviation and other high-tech sectors, traditional aviation giants such as Boeing must reassess their strategic direction to remain ahead of the curve in this volatile world.