It takes an existing major aircraft manufacturer years and billions of dollars to get a new aircraft up and running, and that's leveraging decades of experience, staffing, tooling, and existing facilities.
I assume "let them fail" = "let them run themselves in bankruptcy". At which point, a court manages their re-org into something (hopefully) more lean, efficient, and probably several smaller independent units.
No doubt if they went bankrupt some of their existing employees could make a case to investors to take over the company but run it in a way that doesn't destroy the company due to predictable quality issues.
Especially employees who have a documented history of discussing those exact issues with management, being whistleblowers, etc.
>...take over the company but run it in a way that doesn't destroy the company
Obviously, there is selection bias, but rarely have I seen "investors" take over something without hollowing it out withing a few years. Looking at you Sencha and Thoma Bravo...