Boeing loses $1.1 billion after signing Trump’s Air Force One deal
• Boeing warned of additional losses in the future quarters related to the deal
Boeing Co (NYSE: BA) CEO Dave Calhoun said on Wednesday the airplane maker should not have made the deal with the Trump administration to modify two 747 jumbo jets to serve as Air Force One after it lost $1.1 billion in costs due to the deal.
Boeing warned of additional losses in the future quarters related to the deal.
“Air Force One I’m just going to call a very unique moment, a very unique negotiation, a very unique set of risks that Boeing probably shouldn’t have taken,” Calhoun said on a call with analysts.
“But we are where we are, and we’re going to deliver great airplanes,” Calhoun said. “And we’re going to recognize the costs associated with it.”
Air Force One is the plane which is used to carry the president of the United States.
The Air Force One deal was signed between the then Boeing-CEO Dennis Muilenburg and then-President Donald Trump in February 2018.
According to the deal, Boeing would be responsible for any overruns in the cost of modifying the two Boeing 747 jets.
One of the planes was set to be delivered in 2024 but currently it is not expected to be delivered until 2026. Boeing is being paid about $4 billion for the entire work.
Shares of Boeing fell 12% to $147 during early trading hours after the company reported a quarterly loss and lower revenue than estimated. This was due to rising costs on both commercial and defense aircraft and charges related to the war in Ukraine.
Picture Credits: Reuters
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