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GE Venture Will Share Jet Technology With China

Soulskill posted more than 3 years ago | from the send-them-the-tsa-while-you're-at-it dept.

Businesses 266

vbraga writes "This week, during the visit of Chinese president Hu Jintao to the United States, GE plans to sign a joint-venture agreement in commercial aviation that shows the tricky risk-and-reward calculations American corporations must increasingly make in their pursuit of lucrative markets in China. GE, in partnership with a state-owned Chinese company, will be sharing its most sophisticated airplane electronics (NYT reg. required, reg.-free alternative here), including some of the same technology used in Boeing's new state-of-the-art 787 Dreamliner."

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Repeating history (5, Insightful)

magarity (164372) | more than 3 years ago | (#34912006)

Those who do not learn history are doomed to repeat it... see: software piracy, high speed trains, stealth fighters, aircraft carriers. Up next: commercial aircraft!

Re:Repeating history (0)

Anonymous Coward | more than 3 years ago | (#34912034)

100% agreed. The entire reason they forced the sharing of technology is to acquire it without the investment and infrastructure required to create it, and then using an army of low wage workers they'll put you out of business by building your own product cheaper and selling it to your customers.

Short sighted and irresponsible.

Re:Repeating history (4, Insightful)

Grishnakh (216268) | more than 3 years ago | (#34912664)

Wrong. Short-sighted, yes, but irresponsible, absolutely not. Western companies giving away their secrets to Chinese companies are doing exactly the right thing, because this brings them short-term profit, which is what their shareholders want, and exactly what they're paying their CEOs for. The CEOs are doing exactly what their shareholders want them to.

The shareholders want the CEOs to do anything they can to increase the stock price in the short term, so that they can sell their stock at a profit. After that, they aren't shareholders any more, and don't care what happens to the company. The way American corporations are set up, and the way their stocks are trade with such frequency, long-term strategic moves just aren't in their interest.

Re:Repeating history (4, Insightful)

frosty_tsm (933163) | more than 3 years ago | (#34912838)

Not all investment is in stock price. GE, like most established companies, pays dividends. Their investors purchased their stock years or decades ago and are enjoying a small but reliable payment every 3 months.

In this case, stock price is part of the equation, but is not the entire picture.

Re:Repeating history (2)

DeadManCoding (961283) | more than 3 years ago | (#34912102)

Here's the thing: China has become very well known for making deals to get modern and/or cutting edge technology without having to do the R&D. That is a boon for American companies for short term profits. It also significantly ups the ante for competition within the Chinese market.
The problem that I see for China is that without having to do the R&D, they get the current tech, understand it, maybe make some improvements to that tech. However, I'm not sure if China has the capability to keep up with other global companies, companies that are investing for future technologies. If China doesn't steal those plans, they'll start to fall behind again, which creates a nice purchasing loop for those global companies.
Those Chinese companies may be able to make and improve these commercial airliners, making them cheaper than anyone else, but they won't have the drop on the next new thing, which most global companies are looking for and are investing in.

Re:Repeating history (2)

soundhack (179543) | more than 3 years ago | (#34912140)

While I would agree with your assessment in the short term, China is pushing out huge numbers of engineers, PhDs and otherwise. Granted there is some question as to how competent these graduates are compared to Western counterparts, but as with anything they do, they are incrementally improving.

Pretty soon, they will have enough of a research and development base home grown that I don't think developing cutting edge technology would be that much of a problem.

How about the Japanese? (0)

Anonymous Coward | more than 3 years ago | (#34912368)

People were saying the same things about the Japanese in the 1950,s and 1960's . Nobody now says that they still are copying the western technology. In many areas they are now setting the standard.

Re:How about the Japanese? (1)

Grishnakh (216268) | more than 3 years ago | (#34912768)

Actually, they were setting the standard, as far back as the 80s and even before: their automotive technology in the 70s was already ahead of the American automakers (check out the history of the Honda CVCC engine).

Unfortunately, they made some serious economy screw-ups in the 90s, and while they're still leading in many areas, they've also moved much of their manufacturing to China, and will probably be eclipsed just like the USA.

Re:Repeating history (4, Insightful)

Anthony Mouse (1927662) | more than 3 years ago | (#34912424)

The problem that I see for China is that without having to do the R&D, they get the current tech, understand it, maybe make some improvements to that tech. However, I'm not sure if China has the capability to keep up with other global companies, companies that are investing for future technologies. If China doesn't steal those plans, they'll start to fall behind again, which creates a nice purchasing loop for those global companies.

You're assuming US companies will still have any revenue with which to fund R&D. We're not talking about microprocessors here -- the technology doesn't change that fast. The 747 is from 1969. That's the year we first landed on the moon. If China starts selling five year old technology for half price, five years worth of aircraft "innovation" isn't going to make up for the price difference.

Re:Repeating history (2)

TubeSteak (669689) | more than 3 years ago | (#34912798)

We're not talking about microprocessors here -- the technology doesn't change that fast. The 747 is from 1969. That's the year we first landed on the moon.

Ummm.... RTFS again.
"Boeing's new state-of-the-art 787 Dreamliner"

G.E.'s new joint venture in Shanghai will focus on avionics -- the electronics for communications, navigation, cockpit displays and controls. G.E. will be contributing its leading-edge avionics technology -- a high-performance core computer system that operates as the avionics brain of Boeing's new 787 Dreamliner.

P.S. The 747 has had numerous refreshes of its cockpit avionics over the last 41 years.
2010: http://www.airliners.net/photo/Delta-Air-Lines/Boeing-747-451/1843286/L/ [airliners.net]

Re:Repeating history (1)

timeOday (582209) | more than 3 years ago | (#34912470)

China has become very well known for making deals to get modern and/or cutting edge technology without having to do the R&D. That is a boon for American companies for short term profits.

Except China is doing R&D, and the agreement isn't short-term:

"a person involved in the talks said the 50-50 venture is for 50 years. G.E., the person said, is putting in technology and start-up capital of $200 million. Avic will initially contribute $700 million, the person said, including the cost of a new research and development lab already under construction."

Re:Repeating history (5, Insightful)

Grishnakh (216268) | more than 3 years ago | (#34912748)

Those Chinese companies may be able to make and improve these commercial airliners, making them cheaper than anyone else, but they won't have the drop on the next new thing, which most global companies are looking for and are investing in.

Next new thing? What's that going to be? Hypersonic aircraft or teleporters or something? Be realistic: there IS no next new thing, not for 50-100 years at least. Commercial jet airliners have been with us since the 50s now, and haven't changed significantly in that time. The only things that have changed are 1) engines are a little more efficient and quieter, but not by orders of magnitude, 2) planes are flown slower now to save fuel and keep prices low, 3) seats are packed together so that only toddlers are comfortable in them, and 4) "air rage" is now common whereas it never happened back then.

There's been some other minor improvements of course: much better avionics (which isn't something that GE does to my knowledge), electronic engine controls (which GE does do), etc.

But the idea that Americans or other Westerners are going to come up with huge new advances to always stay ahead of the Chinese is simply ridiculous. For instance, look at the article subject: this is about GE, which doesn't make planes, but jet engines and associated controls. Jet engines haven't changed much in 50 years, just small steady improvements. Most of the advances in jet turbines were in their early days, not any time recently; they're a mature technology, and current advances are only eking out fractions of a percent in improvement, much like automobile engines.

GE is basically giving away their secrets here, and pretty soon there won't be a reason to buy a GE jet engine, because you'll be able to get one just like it made in China for less.

What's worse, China's society heavily values science and engineers. America's does not. Very few people go into engineering any more, except for software engineering. When was the last time you met an aerospace engineer? Way back in the early 90s when I was in college, we joked that AEs would never find a job, because it was a pretty dead industry. Very few engineering majors went into the AE school. ME (which a lot of jet engine engineers probably have) is a little better, but still not great. Go into any major engineering school, and look at the students: most of them are Chinese and Indian, and these days, they go back to their home country when they finish their degree.

America's days as a technology power (except maybe for web development) are almost over.

Re:Repeating history (2)

timeOday (582209) | more than 3 years ago | (#34912882)

There's been some other minor improvements of course: much better avionics (which isn't something that GE does to my knowledge), electronic engine controls (which GE does do), etc.

Actually it is about avionics:

G.E.'s new joint venture in Shanghai will focus on avionics -- the electronics for communications, navigation, cockpit displays and controls. G.E. will be contributing its leading-edge avionics technology -- a high-performance core computer system that operates as the avionics brain of Boeing's new 787 Dreamliner.

Re:Repeating history (3, Insightful)

alchemist68 (550641) | more than 3 years ago | (#34912356)

This IS SO WRONG! GE must be filled with corporate hungry capitalists willing to sacrifice the well-being and safety of the United States of America! I hope some American politicians wake-up and have the balls to challenge this corporate giant. Idiots - they never learn from others' experience - they must experience for themselves at OUR expense. Where is the USA government protecting the people and interests of our country and the TAX PAYER?

Re:Repeating history (1)

Grishnakh (216268) | more than 3 years ago | (#34912790)

This has nothing to do with the US people, government, or taxpayers. GE is a private company; "publicly-owned", but it's owned by its shareholders. The shareholders are the only people it answers to. The shareholders WANT them to do deals like this, because this gives them bigger profits, and pushes up their stock price. That's what shareholders want. They don't care about long-term issues, because they'll sell off the stock when it peaks and let someone else worry about that.

If you think the government should step in and manage these corporations in a way that benefits the country, instead of the shareholders, then why not just transfer ownership of the company to the government? After all, we have a successful example of a society like this: it was called the Soviet Union. All corporations were owned and managed by the central government. As an American, are you advocating that system?

Re:Repeating history (0)

Anonymous Coward | more than 3 years ago | (#34912912)

> they must experience for themselves at OUR expense.

Thing is, YOU have nothing to do with it. And it won't hurt GE; they can just move production to China, which is probably better anyway because they can get skilled labor much cheaper than they can in the USA. I see absolutely no reason for them *not* to do this. Eventually they'll follow the IBM route of moving their jobs to where it makes economic sense.

Look, the only way to compete is to BE the place where it makes economic sense to put jobs. The USA is not that place, and seems intent on making itself less and less competitive. You reap what you sow.

Re:Repeating history (1)

c0lo (1497653) | more than 3 years ago | (#34912844)

Those who do not learn history are doomed to repeat it... see: software piracy, high speed trains, stealth fighters, aircraft carriers. Up next: commercial aircraft!

But... but... they are indeed learning!!
Like: why spend so much in guarding your secrets, that's a huge cost. Isn't it much better to offer them secrets in return for... something... I don't know... money? Afterall, China has enough of US bonds, getting some of them back means something?

Seriously guys: letting aside movies, music and MS Windows (in which China doesn't seem to be interested), what else have US of A to export?

Very stupid... (0)

Anonymous Coward | more than 3 years ago | (#34912026)

I can't believe that GE is this stupid.

Re:Very stupid... (1)

Jeremiah Cornelius (137) | more than 3 years ago | (#34912350)

stupid^H^H^H^H^H^H greedy

Stupid or facing the inevitable? (1)

perpenso (1613749) | more than 3 years ago | (#34912562)

I can't believe that GE is this stupid.

stupid^H^H^H^H^H^H greedy

Let me start by saying that I am naturally skeptical of this sort of deal. However let me offer the logic that may be behind this decision ...

Basically GE has competition and believes that if they decline the offer then a competitor may accept it. In this scenario they lose in both the short term and the long term. To prevent the tech transfer GE and its competitors must essentially establish a cartel and coordinate their actions. The problem is that cartels almost always fail, some member almost always cheats. The "cheating" may not even be greed based, one member may be losing in the market and about to fail so it sells off its tech (or itself) to avoid going out of business. The cartel not only has to coordinate to prevent tech transfer but it would also have to coordinate to keep all members at some minimal level of health. So it is highly likely that someone is going to transfer the tech. GE's logic may be that since someone will most likely do it, they might as well be that someone.

Essentially they may believe that the long term is already lost and that the short term is the only potential win.

Personally I agree with the philosophy that decision makers should be thinking long term except when short term survival is in question. However what does one do when the long term options seem to all be bad? Emotionally I want to say that GE is being dumb or greedy but I can't honestly say that this is the case, a lot more info is needed.

Globalization (4, Insightful)

JasonFlanders (1976920) | more than 3 years ago | (#34912038)

Would China owned companies share any of their military technology with us? We are are simultaneously the strongest and most soft-headed country in the history of the world. How come talk of globalization somehow only includes us selling our shiz off?

Re:Globalization (4, Insightful)

syousef (465911) | more than 3 years ago | (#34912134)

Would China owned companies share any of their military technology with us? We are are simultaneously the strongest and most soft-headed country in the history of the world. How come talk of globalization somehow only includes us selling our shiz off?

Did you expect China to just keep selling you cheap toys and clothing? Eventually an emerging market...emerges.

Re:Globalization (1)

Musically_ut (1054312) | more than 3 years ago | (#34912200)

We are are simultaneously the strongest and most soft-headed country in the history of the world.

... and by we you clearly mean the Slashdotters.

Re:Globalization (1)

Ethanol-fueled (1125189) | more than 3 years ago | (#34912534)

We still have ITAR [state.gov] to be followed. It's how the State Department plays favorites.

I speak with authority because my employer makes such technology(in the sensors and lasers category) and the stuff we sell to China is reduced-accuracy by law.

Re:Globalization (1)

c0lo (1497653) | more than 3 years ago | (#34912920)

Would China owned companies share any of their military technology with us? We are are simultaneously the strongest and most soft-headed country in the history of the world.

What else you have for sale to balance the trade deficit? I mean, what? Music? Movies? MS Windows? What else that China would be interested in buying?

Strongest country? Stop deluding yourself... PR of C doesn't need to invade US of A... if it starts selling only 10% of the US Treasury bonds it owns and in 1 month the USD will be so weak, China will buy the entire US of A on closing-down-sale prices.

How come talk of globalization somehow only includes us selling our shiz off?

Because in a globalize market you live or die by the strength of your economy and not by the strenght of your army?

Yep (5, Insightful)

ShakaUVM (157947) | more than 3 years ago | (#34912040)

Yep. This is how the Chinese have been doing their technology transfer without needing to pay billions in R&D themselves.

They go to a company and tell them that they'd like to build some nuclear reactors or high speed trains or something. The deal they make always goes like:
1) We'll buy the first two nuclear plants.
2) The next two you build using our people.
3) The ones thereafter you give us the plans to build, and we'll do it all ourselves, and pay you a royalty.

Now China has the plans to the AP1000, one of the most modern nuclear plants being built today, as well as a trained workforce in building it, all without having to do any of the R&D work themselves, or pay much more than just the cost of a couple plants (which they get to use anyway).

It's a very clever idea, and companies are all falling over themselves to give away their best technologies to China, since they're so eager for short-term profits, they don't realize they're shooting themselves in the foot, long term.

Re:Yep (0)

Anonymous Coward | more than 3 years ago | (#34912202)

One thing you did not take into account is while China takes the plans for the AP1000 or next gen doohickey, GE is forging on with their next idea. China, using this technique, will catch up, but they will always be 1 step behind. No more, no less.

Re:Yep (5, Insightful)

seifried (12921) | more than 3 years ago | (#34912228)

Which is what Americans used to say about Japan after WWII (they just imitate stuff, they can't innovate!). The Chinese are moving up the food chain of manufacturing/R+D/etc. as we speak, pretending otherwise may make you feel better, but it won't alter reality.

Re:Yep (1)

FooAtWFU (699187) | more than 3 years ago | (#34912928)

Eh, we'll see how well the culture of conformity and top-down control which plagues China can face off against the disruptive innovation of America's best creative minds. Should be an interesting one.

Re:Yep (1)

Kalidor (94097) | more than 3 years ago | (#34912258)

This would be great if it were true, but somehow I highly doubt it. GE's existing Chinese JVs in other businesses (consumer appliances for example) are making either what they are doing here, or stuff that is ahead of what can be done outside of China if only because of materials access.

Re:Yep (2)

ShakaUVM (157947) | more than 3 years ago | (#34912286)

>>One thing you did not take into account is while China takes the plans for the AP1000 or next gen doohickey, GE is forging on with their next idea. China, using this technique, will catch up, but they will always be 1 step behind. No more, no less

Well, the AP1000 is made by CBS (owner of Westinghouse), not GE (owner of NBC).

No matter how you slice it, they're getting a tremendous leg up in technology, and will be able to either continue R&D from a really good starting point, or will be able to just continue making cheap knock-offs of the AP1000, which has a reasonably good design.

Re:Yep (2)

Weezul (52464) | more than 3 years ago | (#34912328)

There is ample evidence that this doesn't really work that way. They learn the underlying theory while working with the technology. Even if they don't push towards the most advanced stuff, they'll still seal up the market, blocking out the company that originally sold them the airplanes.

In the end, the U.S. and E.U. will need to impose tariffs to balance the trade with China, not much choice otherwise.

Re:Yep (1)

Grishnakh (216268) | more than 3 years ago | (#34912822)

Oh please. Next idea? GE makes jet engines, a very mature technology that hasn't changed significantly in decades. So what if GE comes up with an improvement that results in a 0.25% increase in fuel efficiency? 1) The Chinese, after becoming completely familiar with the tech, will make their own improvements, thanks to all the engineers they have (many of whom get their advanced degrees here in the USA). The USA, by contrast, can't get its citizens to go into engineering any more. 2) The Chinese jet engine will cost half as much as the GE one; some tiny improvement won't be worth double the cost.

Re:Yep (1)

countertrolling (1585477) | more than 3 years ago | (#34912220)

...they don't realize they're shooting themselves in the foot, long term.

There is no long term. They will have cashed in their chips long before any trouble begins, then move to another casino

Re:Yep (1)

Anonymous Coward | more than 3 years ago | (#34912270)

They DO realize what they are doing... they just don't give a shit because keeping six houses ( Aspen, Catalina, Hamptons etc.) is mucho expensive! These executives don't care because they'll live in gated communities with a private police force to keep YOU out... once they've sawed off and sold anything of value in this country... it's a system that works well for the 1/2% in central America.

Re:Yep (1)

99BottlesOfBeerInMyF (813746) | more than 3 years ago | (#34912272)

It's a very clever idea, and companies are all falling over themselves to give away their best technologies to China, since they're so eager for short-term profits, they don't realize they're shooting themselves in the foot, long term.

It's a very clever idea, and executives are all falling over themselves to give away their corporation's best technologies to China, since they're so eager for short-term profits and the individual profits and advancement, they don't care they're shooting the corporation they work for (but don't give a rat's ass about) in the foot, long term.

It's the mercenary attitude with which employees are treated and the reciprocal mercenary attitude of said employees that is responsible for this type of "short term is all that matters" strategy by multinationals.

Re:Yep (1)

Jah-Wren Ryel (80510) | more than 3 years ago | (#34912280)

It's a very clever idea, and companies are all falling over themselves to give away their best technologies to China, since they're so eager for short-term profits, they don't realize they're shooting themselves in the foot, long term.

On the flipside, if these companies have management that's worth a damn, they will spend that money on R&D for the next generation of stuff. So far, China has been great at copying but pretty sucky at development. I remember very similar characterizations of Japan back in the 70s and 80s. Eventually Japan got good at development too, but by then they had lost the edge of low labor costs. Korea is further along that path than China is (look at LG and recent korean cars for example), but not yet where Japan is.

Re:Yep (0)

Anonymous Coward | more than 3 years ago | (#34912602)

Eventually Japan got good at development too, but by then they had lost the edge of low labor costs. Korea is further along that path than China is (look at LG and recent korean cars for example), but not yet where Japan is.

True, but was that a bad thing for Japan? They had superior products to the US, so they no longer needed cheaper labor. You get ahead through cheaper labor OR superior technology. Soon, the US will have neither.

Re:Yep (1)

Jah-Wren Ryel (80510) | more than 3 years ago | (#34912792)

True, but was that a bad thing for Japan?

Of course not.

You get ahead through cheaper labor OR superior technology. Soon, the US will have neither.

Yeah, I think you missed the point. Japan is competitive with the US, but they are not even close to being overwhelmingly superior.
China's no more likely than Japan to get a leg up over the US in technology either.

Re:Yep (1)

dbIII (701233) | more than 3 years ago | (#34912348)

Now China has the plans to the AP1000, one of the most modern nuclear plants being built today

With the greatest possible respect, it's not even the most modern nuclear plant being built in China. It's a Westinghouse dinosaur and little more than a scaled down TMI without the containment that saved the place. The old Chinese stuff is better than that so all they are getting is information on a few components that are better.

Re:Yep (1)

ShakaUVM (157947) | more than 3 years ago | (#34912592)

The big three designs right now are the GE ABWR, the Westinghouse AP1000, and the Areva EPR. The AP1000 is a simplified version, but it is a bit of a misnomer to call it a scaled down TMI.

Re:Yep (0)

Anonymous Coward | more than 3 years ago | (#34912392)

And us all in the head.. But I know they more than realize it. They are way past that now.

Re:Yep (0)

Anonymous Coward | more than 3 years ago | (#34912404)

Just out of curiosity...would you really want China to have to work through that learning phase of nuclear reactor development?

The US and USSR weren't able to get through it without major mishaps and nuclear mishaps can have consequences well beyond national borders. Airline tech, high-speed rail I can understand, but something that could result in a nuclear meltdown seems like tech we'd want to share just to keep our world less polluted.

Re:Yep (1)

CrazyDuke (529195) | more than 3 years ago | (#34912422)

They are not shooting themselves in the foot. They are shooting future shareholders and their employees in the foot. They are making out like bandits and will bail to the next job once they get exposed for some other ...err... executive decision. ...or, when the ship sinks, whichever comes first.

Re:Yep (1)

Grishnakh (216268) | more than 3 years ago | (#34912828)

Corporations aren't interested in future shareholders or employees, only current shareholders. Those are the people who own the company, and who call the shots. They want short-term profits, so they can sell their stock at a profit and bail out. The CEO is only doing exactly what the company's owners want him to do, his "fiduciary duty".

Typo in summary (2, Funny)

dbIII (701233) | more than 3 years ago | (#34912042)

Boeing's new state-of-the-art 787 Dreamliner

Shouldn't that be late-of-the-art 787 Dreamliner
Also wasn't there a court case a while ago about Boeing getting the results of some industrial espionage into Airbus? Hasn't there been speculation that some of the Boeing problems were due to blind copying without knowing why parts of the most recent Airbus were designed that way? Are the Chinese really getting anything new that they couldn't get from elsewhere anyway?

Re:Typo in summary (1)

0123456 (636235) | more than 3 years ago | (#34912086)

Also wasn't there a court case a while ago about Boeing getting the results of some industrial espionage into Airbus? Hasn't there been speculation that some of the Boeing problems were due to blind copying without knowing why parts of the most recent Airbus were designed that way?

Aren't the Dreamliner's problems largely due to the massive use of composites? If so, what would Boeing be learning from Airbus?

Re:Typo in summary (1)

dbIII (701233) | more than 3 years ago | (#34912308)

If so, what would Boeing be learning from Airbus?

Not enough apparently. To make things worse the US taxpayer allegedly footed the bill and provided the people for the industrial espionage. With the Chinese buying the stuff outright we at least know what they've got and that they should get it right. The second part is important because budget airlines will buy the cheapest stuff they can get their hands on and you don't want a Chinese made engine coming through your roof.

Re:Typo in summary (1)

mister_playboy (1474163) | more than 3 years ago | (#34912896)

you don't want a Chinese made engine coming through your roof.

Donnie Darko, is that you?

Turnabout? (5, Insightful)

jklappenbach (824031) | more than 3 years ago | (#34912052)

Perhaps we might start demanding that every Chinese company wanting access to American markets must locate offices here, staff them with US workers, and share their technology in turn. We did that with the Japanese...

Re:Turnabout? (1)

CodeBuster (516420) | more than 3 years ago | (#34912702)

The Chinese will simply sell to European middlemen who will then turn around and sell to us at even higher prices. This won't work. The Japanese dealt with the US because they needed us to defend them against foreign aggressors. Remember that Japan depended upon the United States for defense against military attack, including nuclear attack from either China (who still have scores to settle with the Japanese) or Russia, in the decades following WWII. They were willing to put up with US import quotas and tariffs because they needed us. The Chinese, who neither need nor want US military protection, are not likely to be so accommodating.

Trading The Crown Jewels... For What? (1)

cmholm (69081) | more than 3 years ago | (#34912062)

This is even more bone-headed a move than Boeing farming out airframe subassemblies. This is one of the few areas where we have a competitive advantage, and they're going to give it away so that they can sell a few more engines. I don't care if the rationale is that Rolls Royce, SNECMA, P&W, or if it's the price for lower labor costs at a PRC plantsite, or whoever will do it if "we" don't.

When a technology firm is selling off their IP, it's obvious that they are out of the business of developing new IP, and are just milking the efforts of their predacessors. What a sad sight.

Re:Trading The Crown Jewels... For What? (1)

b4dc0d3r (1268512) | more than 3 years ago | (#34912130)

On the other hand, I'd like an engine at the lowest price. Are you going to sell it to me, or is Boeing? Hmm, guess I'm going with Boing. I'm a poet and I didn't even know it.

Capitalism, it's what's for dinner. Want something else? Go be born to someone else, or embrace a different economic system. Mmm, capitalism. Goes down easy, comes up hard.

Re:Trading The Crown Jewels... For What? (1)

Anthony Mouse (1927662) | more than 3 years ago | (#34912492)

Capitalism, it's what's for dinner. Want something else? Go be born to someone else, or embrace a different economic system. Mmm, capitalism. Goes down easy, comes up hard.

It wouldn't be a problem if it was just capitalism. The problem is that China is a company and a country. There is nobody there to enforce antitrust laws. You like your cheap stuff today, but what happens if they dump cheap goods on the market below cost until everyone else goes bust, and then raise the price once no one is left who knows how to make it?

Re:Trading The Crown Jewels... For What? (0)

Anonymous Coward | more than 3 years ago | (#34912218)

The simple fact of the matter is that aircraft sales are highly political today. While the purchasing authority may never say so directly, it's an open secret that the decision between Boeing/Airbus or GE/Pratt/Rolls Royce often comes down to offsets. This is particularly true where airlines are state owned or controlled. Companies are left with the decision to either abandon a market entirely, or make some kind of concession. When it comes to a market like China, you really can't choose to just give up. If you don't play the game, you get frozen out and eventually wind up as an irrelevant regional player (if you're lucky).

Re:Trading The Crown Jewels... For What? (1)

cmholm (69081) | more than 3 years ago | (#34912354)

Re: "Giving up" on the Chinese market... it's like dealing with Walmart: you can either say "no" now and work at adding more value to the product to survive; or, you can sign on the dotted line and watch them suck your margins in-house.

Granted, offsets are a major part of international aerospace. But, offsets to - say - Finland and offsets to China are two all together different birds.

Don't Trust the Chinese (-1)

Anonymous Coward | more than 3 years ago | (#34912074)

Don't trust them... don't sell out...

They have no morals in business... because of the Communist mentality that they were brain washed when they were little.
What kind of a business man will put melamine in milk - this is the same type immoral thinking that they have.

Don't give them anything, we are digging our own graves. Listen up people, listen up.

Re:Don't Trust the Chinese (1)

MrEricSir (398214) | more than 3 years ago | (#34912104)

I'm sure they say the same thing about us. Just swap "communist" with "capitalist" and "melamine in milk" with "trans fats in french fries."

Amoral business practices are not limited to a single culture or country.

Re:Don't Trust the Chinese (1)

Grishnakh (216268) | more than 3 years ago | (#34912846)

B.S.

The melamine thing was by one company, and was punished by the government.

Overall, they absolutely do have morals in business, which is why they're so successful: their moral is to do things that will benefit their country in the long term, without worrying about what benefits their shareholders in the short term. They'd rather spend more money to acquire a technology which will make them the leader in that technology in 20 years, than to work out a deal that costs less in the short term but doesn't give them a giant strategic advantage later.

Maybe that doesn't sound so good because it isn't good for your country or you personally, but they don't care about that. Like anyone else, they're self-interested, except that they do a lot more for their country than Westerners.

You can see where this is going... (5, Interesting)

Jeremi (14640) | more than 3 years ago | (#34912076)

"The Capitalists will sell us the rope with which we will hang them." -- Vladimir Ilyich Lenin

but, but... (0)

Anonymous Coward | more than 3 years ago | (#34912116)

...think about the Q3 & Q4 results...they are going to be sweet! (remind me to short GE in 2014)

Re:but, but... (1)

amiga3D (567632) | more than 3 years ago | (#34912214)

You know, these guys are so greedy and so shortsighted, a dangerous combination. I swear they'd sell a mugger the gun to rob them with.

Re:but, but... (1)

CrazyDuke (529195) | more than 3 years ago | (#34912504)

It's not shortsighted if one expects to bail long before the company smashes into the ground. They aren't making these decisions as some sort of happy-crappy, lets all hold hands and sing along unit. They are doing this for themselves as individuals and no one else, no conspiracy required. In fact, I would imagine a actual conspiracy would just get in the way because of the infighting amongst the individuals for control of the group. As far as they are concerned, we are the morons for caring about things like this and expecting them to act differently because of it.

Re:You can see where this is going... (1)

PPH (736903) | more than 3 years ago | (#34912464)

"The Capitalists will sell us the rope with which we will hang them." -- Vladimir Ilyich Lenin

Not if we can smoke it instead.

Re:You can see where this is going... (1)

DigiShaman (671371) | more than 3 years ago | (#34912516)

Lenin might very well be correct. But, when all the capitalists are hung, how will they survive after they are long gone?

They don't. Capitalist create and exploit resources. Under capitalism, the pie of resources grows with the system. Under communism, the system tends to partition the pie without actually growing it. Eventually, it shrinks as it's raped and plundered.

Should the western capitalist system fall, I really hope for China's sake this all part of their bigger plan to re-take the #1 spot in Super Power status. If not, they will be fucked with civil war at worst, and at best a fractured mainland. Their system as it stands doesn't seem very sustainable.

Re:You can see where this is going... (1)

martin-boundary (547041) | more than 3 years ago | (#34912596)

They don't. Capitalist create and exploit resources. Under capitalism, the pie of resources grows with the system.

BWAHAHA.

Seriously, that's funny. Resources grow with the capitalist system? I need some self-growing oil, can I subscribe to your newsletter?

No. Resources don't grow any better under capitalism than under any other system. That's just nonsense designed to confuse people like you who don't understand physics.

Re:You can see where this is going... (1)

DigiShaman (671371) | more than 3 years ago | (#34912752)

Actually, the oil is out there. Lots of of it in fact. Once it gets expensive, coal gasification can be used to produce fuels that we would normally get from crude.

Look, it's all elementary. The resources are out there. If and when we start to run dry on Earth, we will recycle. If that's not enough, will just bring more back from outside our planet. It all comes down to law and the rule of man. While physics plays a very *small* part in this, the primary (if not only) limitation is the type of governance that a nation is governed by.

Re:You can see where this is going... (0)

Anonymous Coward | more than 3 years ago | (#34912698)

yeah, that guy's plans work out so well.

Re:You can see where this is going... (0)

Anonymous Coward | more than 3 years ago | (#34912898)

except America has to borrow the money from china to buy the rope (also made in china)

Well, look on the bright side (0)

Anonymous Coward | more than 3 years ago | (#34912096)

Considering it's success at meeting milestones, sharing the same technology used in Boeing's new state-of-the-art 787 Dreamliner will probably set the Chinese back 10 years.

Good deal for China (4, Insightful)

DNS-and-BIND (461968) | more than 3 years ago | (#34912114)

China is getting a great deal on this. Not only do they get investment, but they get the tooling and most importantly first-hand knowhow to build reliable high-performance jet engines. China has had lots of trouble mastering jet engines. They are very tricky to get right, especially for them to last a long time and not be replaced every 1000 hours. Apparently just because your net.agents stole the plans from poorly-secured GE desktops doesn't mean you actually know how to use the knowledge.

The unnamed state-owned company that GE will be giving money to isn't even identified in the article. This is because state-owned company means that it is an arm of the Chinese government. Americans unfamiliar with the Chinese SOE and searching for an American equivalent merely need think of GM: owned by the government and not so much worried with making profit as keeping workers employed and achieving national political objectives. These SOEs are a major part of the Chinese economy (even though "journalists" like to tell us that China has gone all capitalist now) and doing a JV (joint venture) with them is putting on lipstick and stockings and getting into bed with the government. Whatever happens next, you know you're getting fucked. We are all aware, of course, that under Chinese law JVs are required to be owned 51% by the Chinese partner? And that there is a long list of broken companies in the last ten years that went into JVs and ended up lying by the roadside, lipstick smudged and used condoms hanging out of their asses? Look up Danone vs. Wahaha for a well-known example. GE's slogan, "imagination at work", should serve it well as it goes shopping for lingerie and a nice water-based lube for the pleasure of its new Chinese husband.

Re:Good deal for China (0)

Anonymous Coward | more than 3 years ago | (#34912326)

It's true. Jet engine technology is the last component that's missing from the equation to build superior fighter planes without reliance on outside firms. Specifically, fifth generation J-20 which could prove to be superior to American F-22s in the coming years.

Once China learns how to manufacture those engines at home it would show GE the door. Fortunately for GE, it won't be a big loss. There's always 30 Rock profits.

Re:Good deal for China (2, Interesting)

Anonymous Coward | more than 3 years ago | (#34912858)

You have a disturbing fondness for graphic rape analogies.

None dare call it treason (0)

Anonymous Coward | more than 3 years ago | (#34912122)

This reminds me of a couple books which I read decades ago... the first was a Red Scare book [amazon.com] about the dangers of transferring technology, science, and business methods to the Soviet Union. It's still in print, probably a favorite of some of the talk radio crowd. The book took its title from a passage from an Elizabethan era political writer:

"Treason doth never prosper, what's the reason?
Why, if it prosper, none dare call it treason"

- Sir John Harrington

The other was a "Yankee Scare" book [amazon.com] written by a Frenchman who sounded the alarm about American corporations buying their way to massive influence across Western Europe. "We are paying them to buy us", I remember the author saying.

Fonterra 2 (1)

Master Moose (1243274) | more than 3 years ago | (#34912150)

I hope this does not work out like Fonterra’s joint venture to try and get a share of the Dairy industry and China: baby Deaths due to too much melamine in infant formula.

http://www.foodtechnology.co.nz/articles/nov08/articles/melamine.php [foodtechnology.co.nz]

I am not sure how this relates to making aeroplanes but to say, there are a lot of dodgy things that seem to go on in china http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com/our+business/news/media+releases/fonterra+believes+hong+kong+claim+has+no+foundation [fonterra.com] (how much lead paint and Spider hero merchandise adorns the shelves of your local dollar store)

On the other hand, anyone who has flown a few hours with a screaming baby will be happy for a melamine meal.

Bad News (0)

Anonymous Coward | more than 3 years ago | (#34912180)

Aircraft manufacturing is, I guess, one of the last bastions of American industry to sell out. Look for Boeing to cut its employee numbers by 50% over the next 10 years.

They'll get all the latest tech (1)

countertrolling (1585477) | more than 3 years ago | (#34912188)

All full of worms and backdoors

China Rising (0)

Anonymous Coward | more than 3 years ago | (#34912194)

When will China just take over? We're already hearing about currency foreplay [infowars.com] , corporations who bend to China's censorship (is Microsoft's Bing functional in China? Yes, you've heard of Google and China, but what of Microsoft Bing in China, do they censor for China?

Is China the Beast of Revelations? With it's growing power and weight, one has to ponder....

Re:China Rising (0)

Anonymous Coward | more than 3 years ago | (#34912274)

No. How could it be? Fiction is fiction.

Re:China Rising (1)

dbIII (701233) | more than 3 years ago | (#34912436)

Is China the Beast of Revelations? With it's growing power and weight, one has to ponder...

No, and neither was 13th century Venice when they became more powerful than Constantinople.
China is less powerful now on the world stage than it was a couple of centuries ago so I think you can put Revelations away. China is still recovering from Mao which hit it harder than the Japanese could. China increasing in global influence is expected. The US decline in global influence was because idiots have been in charge for too long. Ignore China, just worry about your own country and don't jump at shadows to turn a good faith into an armageddon cult.

Re:China Rising (2)

Grishnakh (216268) | more than 3 years ago | (#34912870)

The US decline in global influence was because idiots have been in charge for too long. Ignore China, just worry about your own country and don't jump at shadows to turn a good faith into an armageddon cult.

Worrying about your own country isn't going to improve conditions there, when the leaders are corrupt and the voters absolutely moronic. I think better advice would be to find a good place to bail out to. Get out while the gettin's good, as they used to say.

Re:China Rising (1)

VortexCortex (1117377) | more than 3 years ago | (#34912536)

Is China the Beast of Revelations?

Nope, but they'll get to meet him if they don't deliver my next shipment of Cup-O-Abominations [openfilm.com] before noon tomorrow.

This needs to be blocked. (0)

Anonymous Coward | more than 3 years ago | (#34912206)

Engine technology of all type needs to be a closely guarded secret retained inside the USA and Britain. Making highly reliable jet engines is still an artform. Creating software that does everything necessary is part of that artform.

I use to work for a defense electronics company programming avionic equipment with many US government contracts. I work in the commercial world now, but much of that technology is hard learned over the last 50 yrs. For a 10 yr contract, these companies are giving away 50 yrs of learning. Bad trade.

Seems foolish (1)

Andy Smith (55346) | more than 3 years ago | (#34912292)

Sharing militarily-valuable technology with a potential military enemy doesn't seem wise.

Reminds me of Master of Orion (1)

CrazyJim1 (809850) | more than 3 years ago | (#34912338)

You could research new technologies, spy for new technologies, or get in a petty war with one other race to share all your technologies with them.

There goes america's last export (1)

outsider007 (115534) | more than 3 years ago | (#34912432)

Planes are about the only thing the US exports anymore. Soon we won't even have that.

Re:There goes america's last export (1)

Grishnakh (216268) | more than 3 years ago | (#34912886)

Wrong. America exports lots of other stuff, such as huge quantities of corn and coal. Oh wait, you were talking about high-value manufactured goods. No, we might as well give up on that stuff. Maybe we could sell our cutting-edge military tech to China? That's about the only thing we have left.

Oooh goody! (1)

PPH (736903) | more than 3 years ago | (#34912490)

Maybe we can sell them those exploding electrical panels [flightglobal.com] .

Pretty soon, Boeing 747 made in China (0)

Anonymous Coward | more than 3 years ago | (#34912518)

I will never fly again. Ever.

THis is why I no longer buy GE (0)

Anonymous Coward | more than 3 years ago | (#34912528)

Totally worthless company. At one time, American companies realized the value in having accumulated knowledge and tech. Now, a number of them want to give it to China while asking for handouts from the USA gov. and ppl.
TOtally sick. I think that at this time, that EU is the place to be.

Windbourne (moderating).

We'll see (1)

Brett Buck (811747) | more than 3 years ago | (#34912542)

Of Obama has any common sense at all, he will get this stopped using ITAR.

GE gives same tech used in the boeing Screamliner (1)

fregare (923563) | more than 3 years ago | (#34912604)

This should set back Chinese airplane technology for as long as the Croeing Screamliner has been delayed ! What 10 -20 50 -100 years or so?

no shortage of latent asshole imperialist today (0)

Anonymous Coward | more than 3 years ago | (#34912662)

You seriously expect to sell to somebody goods but then be a suck and interfere with their ability to manufacture the same sometimes down the road?
Looks like a lot of you are simply striking back for having being on the wrong end of gay sex.
Fair trade, try it sometimes.

"NYT Reg Required"? (2)

artor3 (1344997) | more than 3 years ago | (#34912688)

It's a bit off topic, but I don't think NYT requires registration, and I was certainly able to access their article without logging in.

So they have no one to blame but themselves (3, Insightful)

Fallen Kell (165468) | more than 3 years ago | (#34912708)

So they can't blame anyone but themselves when in 2-5 years from now China stops buying those parts because they have reverse engineered them and make them on their own now and dump you now that they have taken the tech they wanted...

Open source ... (1)

giorgist (1208992) | more than 3 years ago | (#34912758)

Well think of it this way,
all this technology is going open source :-)

Why not, let it be that way. many things are going that way. Music CDs are dying and you can only make money through live performaces.

Simply put China is a huge market, and so they have huge leverage ... and it works. Many countries buy weapons via technology transfers with France, Germany, Russia and the US. It's an old trick

Short term gain and (1)

couchslug (175151) | more than 3 years ago | (#34912806)

...long term pain. This is epic stupidity.

The American Empire is dead (1)

plopez (54068) | more than 3 years ago | (#34912812)

This story and the Goldman Sachs story convinces me of that fact. From this time forward all you will see is a few sporadic twitches and spams, but it's over.

Lenin had it figured out. (0)

xs650 (741277) | more than 3 years ago | (#34912816)

The Capitalists will sell us the rope with which we will hang them.

          --Vladimir Ilyich Lenin

Re:Lenin had it figured out. (1)

epyT-R (613989) | more than 3 years ago | (#34912860)

and the communists will build the gallows.....

ideologues of all types always justify taking freedom from everyone else under the guise of defending it.

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