Boeing versus Airbus

Newhouse, who had written The Sporty Game about the commercial aircraft industry two decades earlier, returned to it to cover the competition between Boeing and Airbus through the early 2000s.

The industry analysis is what makes the book useful. Commercial aircraft development requires investment that can exceed a manufacturer's market value, with a payback period measured in decades, against demand that is cyclical and driven by airline profitability. Each programme is effectively a bet on the company. The duopoly structure follows from this: no third entrant can fund the development, and the two incumbents compete on programme decisions made years before the market that will judge them exists.

The strategic divergence is the narrative. Boeing, under management that had moved from Seattle to Chicago and that emphasised shareholder returns after the McDonnell Douglas merger, declined to build a new large aircraft and instead pursued the 787, betting on point-to-point routes served by efficient mid-size long-range aircraft. Airbus bet on the A380, a very large aircraft assuming continued growth in hub-to-hub traffic. Newhouse argues Boeing's read of the market was correct and Airbus's was not.

He also covers the subsidy dispute, with Airbus receiving launch aid from European governments and Boeing benefiting from defence contracts and tax arrangements, and the trade cases each side brought.

Newhouse is critical of Boeing's cultural change after the McDonnell Douglas merger, arguing that financial management displaced engineering authority. That argument was substantially vindicated by the 787's outsourcing problems and later by the 737 MAX. The book predates both. Robison's Flying Blind, also in this reference, covers what followed.