Boeing’s Turbulent Year: Can the Manufacturing Giant Pull Out of Its Nosedive?
2024 brought significant financial, safety and production issues for Boeing. The manufacturing giant has struggled with delayed aircraft deliveries and production flaws, raising concern among its consumers, investors and passengers. In the past year, Boeing stock fell by a startling 15%. Boeing started its year off with a stumble, as it encountered production issues with its 737 and 787 Dreamliner models. Quality control lapses and supply chain distribution issues contributed to the delay of over 50 airplanes, a number which has only grown over the past few months. These delays have not only led to strains between Boeing and its consumers but also increased storage and maintenance costs for the company.
Boeing lost roughly $4 billion in the most recent quarter after company workers chose to strike. That is four times the loss that Wall Street had initially projected for this quarter. On Jan. 30, Boeing warned investors that it generated less revenue and more significant losses than Wall Street had initially anticipated. This warning comes just five days before Boeing was scheduled to release its full financial results for the year.
Last year, CEO Kelly Ortberg stated that Boeing would cut 17,000 jobs and raise more than $24 billion in equity to keep the company afloat. "Although we face near-term challenges, we took important steps to stabilize our business, and our team remains focused on the hard work ahead to build a new future for Boeing," Ortberg said Thursday. The fourth-quarter financial disaster means the company will have lost around $12 billion in 2024. Ortberg told employees in November that the company wouldn't start making a profit again until it ramped up its 737 production to the 38-per-month target it initially aimed to hit by the end of 2023. Analysts say the company only produced nine 737 aircraft in December of 2024.
The question remains: Can Boeing survive the financial struggles and pull out of its nosedive? Boeing is the largest US aerospace exporter and one of the world's two biggest major manufacturers of large commercial jet airliners, along with Europe's Airbus. Boeing also makes bombs and helicopters for the US Army and rockets for NASA, employing over 175,000 workers across the globe. Despite their struggles, they are still viewed as one of the world's largest companies, which cannot be overlooked.
Analysts believe that by addressing some significant issues, Boeing can eventually climb out of its hole and return to its stronghold on the aerospace market. To start, they must put safety first. "Until it soaks through every layer of the company, all the way down to the person who sweeps the factory floor, until everybody has that in their DNA—that the most important thing to Boeing is excellence and safety of flight—there will never be a full, 100% trusting of that company, because their mind is not on the ball. Their mind is on the cash register," said Morrie Goodman, a former communications leader at Boeing, NASA, FEMA and the Commerce Department. Second, they must fix their crippled culture. According to insiders, "Boeing's culture morphed over time from one that valued ingenuity and quality to one that prioritized shareholder returns. That culture is now at the root of Boeing's problems." Third, and something that we are now starting to see Boeing do, is own up and acknowledge their mistakes. Rich Plunkett, head of strategic development for Boeing's engineers' union, said executives need to set an example by publicly acknowledging to all investors what they have learned from their mistakes. "It's not so we can all dogpile on a manager who made a mistake, but what can we learn from a manager who made a mistake?"
As Boeing navigates through one of its most challenging years in company history, the path to recovery seems steep but not unattainable. Boeing has the potential to rebuild its trust among consumers, investors and flyers and, with the correct moves, can ultimately regain its footing in the aerospace industry. Success will depend on how CEO Kelly Ortberg decides to move forward. Will he own up to Boeing's mistakes over the past few years and try to change the precedent? Or will Boeing continue down its rocky path of uncertainty?
Photo Caption: Boeing Aircraft
Photo Credit: Unsplash
