They didn’t really try to optimize for maximum profits.
That memo from 20 years ago talks about how Boeing management was optimizing their earnings to capital expenses ratio by selling off factories and manufacturing lines to their contractors. The idea was that this would make Boeing more efficient. In theory they would have the same profits but lower capital expenses. The memo points out how fallacious this is, because while it does improve _this year’s_ numbers, next year’s profits will drop because they no longer own the factory that makes the profits. The memo points out that the contractors will now be earning a larger and larger share of the profits that Boeing used to collect, while Boeing keeps all of the risks. When you buy a whole fuselage from one supplier and a pair of wings from another, you take on all the risk that they won’t fit together properly while the suppliers pad their profits by making you pay extra for every change you ask for.
That memo from 20 years ago talks about how Boeing management was optimizing their earnings to capital expenses ratio by selling off factories and manufacturing lines to their contractors. The idea was that this would make Boeing more efficient. In theory they would have the same profits but lower capital expenses. The memo points out how fallacious this is, because while it does improve _this year’s_ numbers, next year’s profits will drop because they no longer own the factory that makes the profits. The memo points out that the contractors will now be earning a larger and larger share of the profits that Boeing used to collect, while Boeing keeps all of the risks. When you buy a whole fuselage from one supplier and a pair of wings from another, you take on all the risk that they won’t fit together properly while the suppliers pad their profits by making you pay extra for every change you ask for.