In thirteen pages this paper discusses Thunderbird case A07 99 0028 with regards to Lufthansa's 1985 decisions of twenty Boeing 737s and questions the decision making of Chairman Heinz Ruhnau. One source is cited in the bibliography.
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Payment would be due at the time of delivery, and the two companies agreed to a package price of $500,000,000, payable in US dollars.
This was a time of great change in US business, the movement of which significantly affected the value of the dollar relative to the currencies of other nations.
Ruhnau had a variety of hedging options available, but he believed that the dollar would be worth less at the end of the year than it was when Lufthansa
entered into its agreement with Boeing. His beliefs later threatened his position as Chairman of Lufthansa. Conditions in the US
The US economy could not be said to be in upheaval in 1985, but it was far from stable at the time. All
the developed world had suffered a deep recession in response to the world oil crisis in 1973-74. In the US, the oil crisis came at a time when the
Vietnam war was ending and the true costs incurred during the Lyndon Johnson presidency were revealing themselves. The American electronics industry already had been usurped by Japanese manufacturers, and
Americans discovery of Japans high quality, fuel efficient cars during the oil crisis had translated to cutbacks and layoffs among all the Detroit-based automakers.
The future of the dollar was not certain even within the US. Inept fiscal management during the decade of the 1970s had contributed to rising inflation that was
finally brought under control by the joint efforts of the Reagan administration and the US Federal Reserve Board under the leadership of Alan Greenspan. Double-digit inflation had persisted into