EDITORIAL : AEROSPACE INC. THE PROPOSED MERGER OF BOEING AND MCDONNELL DOUGLAS IS GOOD NEWS FOR THE SOUTHLAND.BOEING'S announcement Sunday that it will acquire McDonnell Douglas McDonnell Douglas was a major American aerospace manufacturer and defense contractor, producing a number of famous commercial and military aircraft. It merged with Boeing in 1997 to form The Boeing Company. for $13.3 billion in stock is a shrewd move for both companies and welcome news for Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. . Yet there are concerns. The acquisition will create an aviation powerhouse. The new company will have massive technical, financial, manufacturing and marketing resources capable of dominating national and global markets for both commercial and military jets. Boeing and McDonnell Douglas together command more than 60 percent of the world market for large commercial jetliners. Locally, the merger has enormous potential. Although Boeing is based in Seattle, and McDonnell Douglas is based in St. Louis, the two companies employ 42,000 people in Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, , making a combined company the region's largest private industrial employer. In August, Boeing agreed to acquire the defense assets of Rockwell International Rockwell International was the ultimate incarnation of a series of companies under the sphere of influence of Willard Rockwell, who had made his fortune after the invention and successful launch of a new bearing system for truck axles in 1919. Corp., including Rocketdyne and its 4,100 workers in the San Fernando Valley San Fernando Valley Valley, southern California, U.S. Northwest of central Los Angeles, the valley is bounded by the San Gabriel, Santa Susana, and Santa Monica mountains and the Simi Hills. . An additional 1,000 workers in Palmdale - formerly with Rockwell's Space and North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. Aircraft Division - also are under Boeing's wing. Naturally, workers are wondering about their jobs. But Boeing is looking to grow. And while there may be some layoffs to reduce duplication, there is far more potential for growth. For example, such a merger now means Boeing can challenge Airbus Industrie, a European consortium, in designing a 550-seat super jumbo commercial jet to sell around the world. Boeing also is in competition against Lockheed Martin For the former company, see . Lockheed Martin (NYSE: LMT) is a leading multinational aerospace manufacturer and advanced technology company formed in 1995 by the merger of Lockheed Corporation with Martin Marietta. Corp. to build the Pentagon's next-generation joint strike fighter, potentially worth $750 billion or more. (Boeing, by the way, beat out McDonnell Douglas for that potential lucrative contract.) But with all this merging comes tough antitrust questions. One is that only one U.S. company would produce civilian jetliners. Antitrust regulators need to carefully consider the impact of less competition in the development of new, next-generation airliners. Likewise, the Defense Department, which has encouraged the downsizing (1) Converting mainframe and mini-based systems to client/server LANs. (2) To reduce equipment and associated costs by switching to a less-expensive system. (jargon) downsizing of military suppliers to cut industry costs and save taxpayers' money, also must question whether there are enough companies left to compete. But, on the whole, this merger would seem to be a boon for Southern California, since it promises - with the participation of Boeing - to strengthen, rather than weaken, this region's position in the aerospace industry. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion