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Boeing CEO Regrets Deal With Trump For New Air Force One Jets That Will Cost Company $1 Billion

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Topline

Boeing has lost $660 million developing two Air Force One 747 jets following a “very unique” 2018 deal with then President Donald Trump that placed liability for cost changes on the company rather than on taxpayers, CEO Dave Calhoun reportedly told investors Wednesday.

Key Facts

Calhoun said the company expects to lose a total of $1.1 billion on the planes, which were originally set to be delivered by 2024 but could take longer, the BBC reported.

Calhoun remarked that Boeing “probably should not have taken” the fixed-price $3.9 billion contract, which was revised to make the company responsible for cost changes after Trump insisted that the original arrangement was too pricey.

The project’s spiraling expenses were driven by rising supplier costs, rising technical costs and scheduling difficulties, the company said in its quarterly report Wednesday.

Calhoun’s comments came as the company posted a $1.24 billion loss for the first quarter of 2022.

Boeing stock fell by 8.97% to $152.04 per share Wednesday afternoon following the release of the company’s quarterly report.

Key Background

The title “Air Force One”—which can apply to any aircraft carrying the president—was first used in 1953 to distinguish the plane carrying President Dwight D. Eisenhower from a commercial flight using a similar call sign. In 1962, the first custom-built presidential jet, a Boeing 707, was introduced. The aircraft currently designated to serve as Air Force One include two Boeing 747-200 planes capable of midair refueling and customized to resist electromagnetic attacks, according to the White House. The pair of modified 747-8s currently under development will offer a longer travel range and will emit 16 tons less carbon dioxide per trip than the current 747-200s, Boeing said.

Big Number

4,200. That’s about how many commercial planes are in Boeing’s current backlog, the company reported.

Further Reading

“Empty Tequila Bottles Reportedly Found On New Air Force One Plane Under Construction” (Forbes)



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