FARNBOROUGH: Meet Boeing’s new boss — NOT same as old boss

Ray Conner.jpgLess than two weeks after his appointment, Boeing Commercial Airplanes CEO and President Ray Conner faced the news media for the first time on the eve of the Farnborough air show.

While emphasising the goal of maintaining continuity, Conner’s responses revealed sharp lines between his philosophy and that of his former boss Jim Albaugh, who stepped down on 26 June and will retire on 1 October.

Specifically, Conner refused to accuse Airbus of predatory pricing tactics, backed off a year-end timetable for a 777X decision and mocked a goal to achieve merely parity on market share with the 737 Max against the A320neo.

At the same time, Conner praised Albaugh for doing a “terrific job for us in a difficult time”, noting that his predecessor had achieved his goals to stabilise the 787 and 747-8, repair relations with a strike-prone labour force, and win the KC-46 tanker contract. “I think it was a good time for him to go, for him,” Conner said.

The strategy that Albaugh’s team crafted since 2009 also should remain largely intact under Conner’s leadership. “We’ve got a strategy that we’ve put in place over the course of time. We’re not going to change that strategy,” Conner said.

But many of Conner’s other answers showed even if the overall strategy is maintained, certain elements will begin to look a lot different.

Under Albaugh, Boeing’s stated strategy was to achieve parity on 737 Max sales against its re-engined Airbus rival over the next decade. To someone with Conner’s sales background, that sounds a lot like defeat.

“I thought [the goal] was 100%,” he said. “You’re talking to a sales guy. I don’t want to lose any [orders].”

For journalists, meeting an executive for the first time is a lot like unruly students gauging the smarts of a substitute teacher. Conner was asked repeatedly about the discarded parity goal, but the substance of his answer never changed. Conner was asked again when Boeing would achieve sales parity with the A320neo.

“I wouldn’t speculate on that. There’s just too many factors that go into it,” he said. “I don’t make any comment about market share. We just go out to win everyone we can. That’s all.”

Conner also was reminded of a 737 Max-related story less than two months ago, when Albaugh publicly accused Airbus of engaging in predatory pricing tactics, an allegation carrying legal implications.

“Predatory pricing?” Conner responded. “Pricing is what pricing is. We look at every one of these deals individually and nothing has changed of where our guidance is in terms of margins. I don’t know what the other guy is doing, but I know what we’re doing.”

Not giving up, the reporter noted that Albaugh specifically used the term “predatory pricing” in his public complaint about Airbus.

“It’s a competitive enviornment,” Conner said. “That’s all I’ll say about that.”

Moving right along, another Conner-Albaugh split arose over the timing of a decision on whether the launch the 777X and 787-10X. As recently as mid-June, Boeing programme officials said the plan was still to present a concept to Boeing’s board of directors by the end of the year. Naturally, Conner was asked if that was still the plan.

“When we’re ready to go, when [the customers are] ready to go, that’s when we’ll go,” Conner says. “We don’t have a specific time period. This is more about getting the airplanes right. Once all that’s done then we’ll go to our board and then we’ll make a decision about where to go.”
Naturally, Conner was asked the same question again.

“We’re going through the whole process today, all the different trades. We’ve been having detailed conversations with our customers about it, and when we feel like we have the right airplane then we’ll go to our board and talk about getting authority to offer.”

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