Short Bus

Last week, I had a little ramble about Boeing’s manufacturing issues with the 787 Dreamliner. This week, it’s Airbus’ turn to get raked over the coals, as its gigantor-plane, the A380, is going to have shipping delays because of wiring problems.

Airbus’ stock got hammered for this, and now there are some questions about stock sales by executives and their families, according to this WSJ (registration required) piece:

One key question surrounds large stock sales by [co-CEO of Airbus’ parent company] Mr. Forgeard, three of his children and other top EADS managers in mid-March. “We were not aware, not the shareholders, not the directors” of the A380’s problems at that point, Mr. Forgeard said. He said the troubles with the A380 surfaced in April, and that in late May they still seemed surmountable. EADS stock plummeted 26% Wednesday after the announcements of the delay and a profit warning. The stock price rose by Friday to €20.50 ($25.85). It remained well below prices in March, when Mr. Forgeard exercised €2.5 million worth of options at €32.01, and three of his children each sold €1.4 million worth of shares at the time at €32.82, according to the French stock-market regulator AMF. Board members Francois Auque and Jean-Paul Gut also sold shares.

The BusinessWeek piece on Airbus discusses more of the problems with the A380, which seems to me like the giant-SUV of airplanes. It’s funny that the European company comes up with that model as its big splash, while the U.S. company comes up with the smaller, lightweight, fuel-conscious 787.

I find the workings of various industries fascinating, but the airplane and airline businesses are particularly interesting to me. The battle between Boeing and Airbus helps me think about the role government subsidies and the WTO; changes in materials, manufacturing and design paradigms; economy-of-scale strategies for travel routes, and why the hub-and-spoke model collapsed; and how emerging markets are shaping policy (have any of you guys flown on Singapore Airlines or Emirates?).

(Update: More on the story — and how it affects airlines — at the NYTimes.)

Measure for Mermaid

If you’re in NYC and got a hankerin’ for some Shakespeare, former VM buddy John Castro (not-so-long story) is launching his new theater company tonight with Measure For Measure. Dates, times, location, tickets, etc. are at the Hipgnosis Theatre site.

I’m not planning on being there, for a variety of reasons. Opening night is out because I’m pretty stressed out from writing my Top 20 Pharma Companies report (nice job by Wyeth, not reporting that it’s fired 750 sales reps), and I’ll be probably be parked in front of the big screen to watch game 4 of Mavs-Heat. Also, I’ve never read M4M and I’m afraid to pick up another book while I still have 500 pages of The Power Broker remaining.

Besides, if I were to go into NYC tonight, it would be to catch ABC over at the Canal Room. Now That is one fine suit . . .

Maybe we’ll go next weekend, but our big excursion is likely going to be the Coney Island Mermaid Parade! I haven’t been to Coney Island since I was a little kid, and I’m usually away at conferences on parade weekend, so I’m hoping we get good weather and can get blisteringly drunk while watching my erstwhile favorite bartenderess try to win the Best Marching Group award (her group came in 2nd last year as the Mir-Maids).

I kinda doubt we’ll be in any Shakespeare mood after something like that, but hey.

Megaton

Foreign Policy looks at six megacities (pop. 10+ mil.) and why they might collapse.

Evidently, Mumbai’s weather is so bad, the city even gets hailstorms of criticism. (Thanks. I’ll be here all week.) But seriously: 37 inches of rain in 24 hours?

Best Burger Ever

I know I’ve praised the virtues of the In-N-Out burger profusely in the last few years, and I’ll take the Fatburger as the best east coast alternative, but Amy & I made the pilgrimage to one of the best burger joints around: White Manna.

If you come for a visit, I promise to take you there, but I can’t promise that the onions will ever let you rest.

Bo(e)ing

Neat article in BusinessWeek about problems with the new Boeing 787 Dreamliner. This falls into the “I find this stuff fascinating but recognize that many readers don’t care about how some/most/all industries work.”

The article discusses the new model of production that Boeing’s trying to implement for this plane. The company’s engaged in a variety of outsourcing that it hasn’t really tried before, and that may be tied directly to the technological hurdles that the new plane is facing:

Boeing has undertaken a grand business experiment with the Dreamliner. In a bid to tap the best talent and hold down costs, the aerospace icon has engaged in extreme outsourcing, leaving it highly dependent on a far-flung supply chain that includes 43 “top-tier” suppliers on three continents. It is the first time Boeing has ever outsourced the most critical areas of the plane, the wing and the fuselage. About 80% of the Dreamliner is being fabricated by outside suppliers, vs. 51% for existing Boeing planes.

The Dreamliner’s mounting challenges call into question whether such a radical business model can succeed, and whether the advantages of collaboration on such a scale are outweighed by the loss of logistical and design control.

My day job is editing a magazine about outsourcing in the pharma/biopharma industry, so I wonder about how other industries manage this stuff. It’s not the commodity-level transactions that are interesting (like sourcing your wiring or excipients from a provider), but the question of how you look out-of-house for the more integral aspects of product design and development.

Now, for smaller biopharma companies, that’s a functional necessity, since they don’t tend to have the infrastructure to develop things themselves. But when it comes to aviation, in which there are really only a pair of major players left, it’s gotta be a much dicier proposition.

In this instance, the fuselage cracked.

I don’t feel tardy

I’ve been on prednisone for the last 10 days, trying to clear out the ugly ol’ case of poison ivy I picked up from the Memorial Day yard-clearing extravaganza. The pred has left me pasted by heartburn for over a week, which is no fun. I’ve juggled the sleeplessness with some Xanax & gin, which seems to be working okay, but this morning, I finally looked up all the listed side effects of this little corticosteroid and discovered that among of the rarer ones are a “false sense of well-being” and “mistaken feelings of self-importance.”

I don’t even know how you begin to diagnose that. I mean, does the doctor say, “You’re not doing as well as you think! And you’re simply not that important! This is just a side effect!”

Evidently, I may also get them menstrual cramps, real bad.