8 ms·

Boeing reports Starliner losses of more than half a billion dollars in 2024

49 points by isaacfrond 2y ago

briandear 2y ago
[flagged]
- somewhereoutth 2y ago
  "boeing" - the sound made by bits of aircraft hitting the ground.
  - metalman 2y ago
    boeing ,boeing , gone!
lupusreal 2y ago
Best thing that could happen for Boeing right now is for Elon Musk to order that contract terminated, so Boeing can subsequently assert a conflict of interest and sue the government over it. When Bill Nelson announced that he didn't see the Starliner program ending before fulfilling it's contract I could feel Boeing shareholders everywhere wincing. Boeing, for what it's worth, has learned from their mistakes with this project; they will never accept fixed-price contracts again. Rendering a service for an agreed upon amount of money is too complicated for Boeing, they will now only accept "cost-plus" infinite money tap contracts.
- MPSimmons 2y ago
  >Boeing, for what it's worth, has learned from their mistakes with this project okay, learning is good >they will never accept fixed-price contracts again Yeah, that's not the lesson they should take from this fiasco. Given how Boeing was reportedly acting regarding the development of a new crew vehicle[1], the hubris shown seems to be systemic, top to bottom. I have no empathy for the Boeing management that got them into this situation, and if their takeaway is "we're just not going to accept contracts like this", and not, "we need to deeply change how we engineer solutions", then coupled with the 737-max tragedies, Boeing can go bankrupt for all I care. [1] - https://www.reddit.com/r/Starliner/comments/1f0g0ow/some_interesting_excerpts_from_eric_bergers/ https://www.reddit.com/r/Starliner/comments/1f0g0ow/some_int...
  - lupusreal 2y ago
    Please understand, putting a can of human beans into LEO using a preexisting flight proven rocket is very hard and there is no possible way America's most experienced aerospace company could have possibility come up with a realistic estimate for what it would cost. There is a competency crisis at Boeing. Not in America generally, as some have suggested, but Boeing specifically.
- Neywiny 2y ago
  They already learned that lesson with airforce one. Unsure on the timelines of them, but agreeing with others that it's the wrong lesson to learn. FFP can be done well. They are not doing them well.
- newsclues 2y ago
  Best thing for Boeing is for it to have competent engineers take over the leadership. Boeing needs to be Boeing not McDonnell Douglas.
- fransje26 2y ago
  > Boeing, for what it's worth, has learned from their mistakes with this project Ha ha, no. What Boeing should have learned, after the past 5 years of repeated failures, and 346 deaths -may they rest in peace-, is that their engineering quality is lacking. The only logical conclusion that can be made from all these failures is crystal clear: we have to prioritize engineering quality, so that our products can be delivered on time, and work safely and as expected. With this, we can create value that can be redistributed to our shareholders. What you suggest they learned is: let's refuse fixed-price contracts, so that we can milk this cow until she starves. And unfortunately, knowing Boeing, that's exactly the lesson they will have taken away from this program, which is why we can expect them to continue failing miserably in the future. Probably at the cost of human lives.
  - southernplaces7 2y ago
    >so that we can milk this cow until she starves. Since the federal government is one absolutely huge, well-fed cow, you can expect Boeing to continue milking this teat for a very long time to come. Let's just hope that fewer people die as a result; We all fly Boeing at one time or another.
    - SanjayMehta 2y ago
      > We all fly Boeing at one time or another. Kayak.com allows you to pick flights based on the aircraft.
      - southernplaces7 2y ago
        didn't know that, but, useful thing to know indeed.
  - ethbr1 2y ago
    > we have to prioritize engineering quality, so that our products can be delivered on time, and work safely and as expected This would require upper middle management at Boeing deciding to fire themselves, so they can hire better engineering management.
- T-A 2y ago
  "venture firm Space Capital predicts both Boeing and Airbus will divest their space divisions in 2025": https://spacenews.com/space-venture-firm-predicts-industry-shakeup/ https://spacenews.com/space-venture-firm-predicts-industry-s...
  - InTheArena 2y ago
    SpaceX is making both of them pull out we are in the stupid place of having to depend on Bezos to be cost efficient competition. China will be launching their reusables (note plural) this year.
- InTheArena 2y ago
  Boeings problem is not that the United States government isnt giving it enough blank checks (cost plus contracts). If anything it’s the opposite. Fat cat got fat, and now everyone else in encroaching on their territory. This is the true tragedy of Doge right now. The amount of fat cat entities who are eating themselves to death on the backs of USA tax payers is staggering. But I doubt anything effective ever comes out of Elon and company here.
- MangoCoffee 2y ago
  It's probably better for Boeing to give up its space business and focus on its airplane safety.
baal80spam 2y ago
"After a $523 million charge on its CST-100 Starliner program in 2024, Boeing's total losses on the commercial crew vehicle now exceed $2 billion -- and there's still no clear timeline for its next flight."
jongjong 2y ago
The sad thing is, once a company loses its spark of engineering excellence, it's very difficult to recover. Politics take the place of excellence and this creates an environment where the talented are systematically suppressed and rejected. Those who run the show are not only incapable of identifying talent, but feel repulsed by it. "The person of superior intellect is conscious of his superiority and therefore does not take so much pains to conceal it. From this the vulgar feel their insignificance, and therefore hate the possessor of such qualities." - Schopenhauer
- bane 2y ago
  I have a different take on this. Hardware is hard. Space hardware is exponentially so. But in general these days we value non-physical stuff at multiples of the real. Meta lost $15b on its Reality Labs last year by comparison. Orders of magnitude more. Lots of that was in AI, but that's a spend who's main value to Meta is to block OpenAI from outright monopoly and maybe push some more ads. Space has a lot of money in it (Starlink alone made like $7B maybe last year!), which is why there are so many companies trying to get up there, but a half-billion loss on manned space hardware has all of us (including me) taking turns throwing flames at Boeing for being a dying dinosaur when in fact what they've already done is definitely harder than VR and arguably in the long run has more "value" to us as a species. I sometimes see these numbers and have to reset my perspective about value and worth and what judgments I'm making about them.
  - snapcaster 2y ago
    This is a good point that should be taken into account, but also i'm not a Meta user or shareholder (outside of ETFs etc.) so i don't care what they do with their money. Boeing is lighting our tax payments on fire and literally killing people
  - somenameforme 2y ago
    The problem with this take is that Boeing was a major part of the Apollo program where they achieved dramatically more than is being asked of them here, in a far shorter time frame, and for far less money. There's no real explanation besides a complete atrophy of talent and overall capability, probably driven by becoming an entirely profit oriented company where taxpayer funding became a more productive means of of revenue generation than increasing quality or reducing costs.
t1234s 2y ago
How is Boeing having so many issues with Starliner when it appears they have perfect success with the X-37? Is something like this due to over-compartmentalization and having to re-invent too many things?
- justin66 2y ago
  As wikipedia says: "Most of the activities of the X-37B project are secret." Presumably that includes some of the things that would bring about bad press.
- andyjohnson0 2y ago
  As I recall, the Starliner contract was fixed cost and the X-37 was cost plus. Its not a new observation that the space and defence part of Boeing struggles with the former after decades of the latter. But also, and obviously, Starliner is crew-rated and X-37 isn't. That introduces a lot of additional design and test complexity, as well as more conservative operational decision-making.
  - rtkwe 2y ago
    If I had to put one thing as the major boost in difficulty it'd be the crew rating. It's a lot easier to build a craft when it doesn't need to hold and maintain a breathable atmosphere.
- InTheArena 2y ago
  A with almost every defense contract, X-37 is cost plus and classified, which means that Boeing has been passing the costs on to the USA tax payer rather then have to pay for their mistakes. It’s possible that the program is perfectly run and on budget, but no transparency exists to validate that.
- voxadam 2y ago
  Beyond cost vs cost-plus contracts I wonder if part of it might be that the X-37 was designed by qualified engineers at Boeing while Starliner was co-designed with members of the US Congress.
b_davis_ 2y ago
i find it very 'rich' that a crowd that would never accept firm fixed price work (we do 'agile', it has to be flexible .. we need time to explore options ...) is so down on cost plus. 'cost plus' is not infinite money. there is a budget, performance is evaluated every quarter. every increase is reviewed. the additional money has to be appropriated. firm fixed price is how the government buys low risk. For lack of a better analogy, a waterfall development. Requirements are clear, the technology is well known. From the beginning. cost plus is how the government buys systems that have never been made before.
- dylan604 2y ago
  > Requirements are clear, the technology is well known. From the beginning. Is that really a true statement, even for Starliner? The US Gov't is infamous for changing plans/designs well into the process for many items which is the key reason for cost overruns and blown deadlines. I didn't follow Starliner's development process at all, but I would be shocked if from the beginning the requirements didn't change.
  - b_davis_ 2y ago
    that mismatch between risk / requirements and the type of contract is the root of this whole problem. if it was cost plus, the government would have had an incentive to no push for changes, since they would have been paying for it. and yes, Boeing should have said no. but, politics.
    - jjk166 2y ago
      Requirement changes on cost plus contracts are endemic. And it's not one way - typically the pipeline is starting to work on the project with requirement A under the assumption it will cost X, find out a decent way through that it's going to cost way more than X, then change to requirements B under the assumption it will only cost Y, repeat two or three times.
deleted 2y ago
[deleted]
daft_pink 2y ago
Maybe they should apply for a grant from usaid

49 points by isaacfrond 2y ago

briandear 2y ago

[flagged]

somewhereoutth 2y ago
"boeing" - the sound made by bits of aircraft hitting the ground.
- metalman 2y ago
  boeing ,boeing , gone!

lupusreal 2y ago

Best thing that could happen for Boeing right now is for Elon Musk to order that contract terminated, so Boeing can subsequently assert a conflict of interest and sue the government over it. When Bill Nelson announced that he didn't see the Starliner program ending before fulfilling it's contract I could feel Boeing shareholders everywhere wincing. Boeing, for what it's worth, has learned from their mistakes with this project; they will never accept fixed-price contracts again. Rendering a service for an agreed upon amount of money is too complicated for Boeing, they will now only accept "cost-plus" infinite money tap contracts.

MPSimmons 2y ago
>Boeing, for what it's worth, has learned from their mistakes with this project okay, learning is good >they will never accept fixed-price contracts again Yeah, that's not the lesson they should take from this fiasco. Given how Boeing was reportedly acting regarding the development of a new crew vehicle[1], the hubris shown seems to be systemic, top to bottom. I have no empathy for the Boeing management that got them into this situation, and if their takeaway is "we're just not going to accept contracts like this", and not, "we need to deeply change how we engineer solutions", then coupled with the 737-max tragedies, Boeing can go bankrupt for all I care. [1] - https://www.reddit.com/r/Starliner/comments/1f0g0ow/some_interesting_excerpts_from_eric_bergers/ https://www.reddit.com/r/Starliner/comments/1f0g0ow/some_int...
- lupusreal 2y ago
  Please understand, putting a can of human beans into LEO using a preexisting flight proven rocket is very hard and there is no possible way America's most experienced aerospace company could have possibility come up with a realistic estimate for what it would cost. There is a competency crisis at Boeing. Not in America generally, as some have suggested, but Boeing specifically.
Neywiny 2y ago
They already learned that lesson with airforce one. Unsure on the timelines of them, but agreeing with others that it's the wrong lesson to learn. FFP can be done well. They are not doing them well.
newsclues 2y ago
Best thing for Boeing is for it to have competent engineers take over the leadership. Boeing needs to be Boeing not McDonnell Douglas.
fransje26 2y ago
> Boeing, for what it's worth, has learned from their mistakes with this project Ha ha, no. What Boeing should have learned, after the past 5 years of repeated failures, and 346 deaths -may they rest in peace-, is that their engineering quality is lacking. The only logical conclusion that can be made from all these failures is crystal clear: we have to prioritize engineering quality, so that our products can be delivered on time, and work safely and as expected. With this, we can create value that can be redistributed to our shareholders. What you suggest they learned is: let's refuse fixed-price contracts, so that we can milk this cow until she starves. And unfortunately, knowing Boeing, that's exactly the lesson they will have taken away from this program, which is why we can expect them to continue failing miserably in the future. Probably at the cost of human lives.
- southernplaces7 2y ago
  >so that we can milk this cow until she starves. Since the federal government is one absolutely huge, well-fed cow, you can expect Boeing to continue milking this teat for a very long time to come. Let's just hope that fewer people die as a result; We all fly Boeing at one time or another.
  - SanjayMehta 2y ago
    > We all fly Boeing at one time or another. Kayak.com allows you to pick flights based on the aircraft.
    - southernplaces7 2y ago
      didn't know that, but, useful thing to know indeed.
- ethbr1 2y ago
  > we have to prioritize engineering quality, so that our products can be delivered on time, and work safely and as expected This would require upper middle management at Boeing deciding to fire themselves, so they can hire better engineering management.
T-A 2y ago
"venture firm Space Capital predicts both Boeing and Airbus will divest their space divisions in 2025": https://spacenews.com/space-venture-firm-predicts-industry-shakeup/ https://spacenews.com/space-venture-firm-predicts-industry-s...
- InTheArena 2y ago
  SpaceX is making both of them pull out we are in the stupid place of having to depend on Bezos to be cost efficient competition. China will be launching their reusables (note plural) this year.
InTheArena 2y ago
Boeings problem is not that the United States government isnt giving it enough blank checks (cost plus contracts). If anything it’s the opposite. Fat cat got fat, and now everyone else in encroaching on their territory. This is the true tragedy of Doge right now. The amount of fat cat entities who are eating themselves to death on the backs of USA tax payers is staggering. But I doubt anything effective ever comes out of Elon and company here.
MangoCoffee 2y ago
It's probably better for Boeing to give up its space business and focus on its airplane safety.

baal80spam 2y ago

"After a $523 million charge on its CST-100 Starliner program in 2024, Boeing's total losses on the commercial crew vehicle now exceed $2 billion -- and there's still no clear timeline for its next flight."

jongjong 2y ago

The sad thing is, once a company loses its spark of engineering excellence, it's very difficult to recover. Politics take the place of excellence and this creates an environment where the talented are systematically suppressed and rejected. Those who run the show are not only incapable of identifying talent, but feel repulsed by it. "The person of superior intellect is conscious of his superiority and therefore does not take so much pains to conceal it. From this the vulgar feel their insignificance, and therefore hate the possessor of such qualities." - Schopenhauer

bane 2y ago
I have a different take on this. Hardware is hard. Space hardware is exponentially so. But in general these days we value non-physical stuff at multiples of the real. Meta lost $15b on its Reality Labs last year by comparison. Orders of magnitude more. Lots of that was in AI, but that's a spend who's main value to Meta is to block OpenAI from outright monopoly and maybe push some more ads. Space has a lot of money in it (Starlink alone made like $7B maybe last year!), which is why there are so many companies trying to get up there, but a half-billion loss on manned space hardware has all of us (including me) taking turns throwing flames at Boeing for being a dying dinosaur when in fact what they've already done is definitely harder than VR and arguably in the long run has more "value" to us as a species. I sometimes see these numbers and have to reset my perspective about value and worth and what judgments I'm making about them.
- snapcaster 2y ago
  This is a good point that should be taken into account, but also i'm not a Meta user or shareholder (outside of ETFs etc.) so i don't care what they do with their money. Boeing is lighting our tax payments on fire and literally killing people
- somenameforme 2y ago
  The problem with this take is that Boeing was a major part of the Apollo program where they achieved dramatically more than is being asked of them here, in a far shorter time frame, and for far less money. There's no real explanation besides a complete atrophy of talent and overall capability, probably driven by becoming an entirely profit oriented company where taxpayer funding became a more productive means of of revenue generation than increasing quality or reducing costs.

t1234s 2y ago

How is Boeing having so many issues with Starliner when it appears they have perfect success with the X-37? Is something like this due to over-compartmentalization and having to re-invent too many things?

justin66 2y ago
As wikipedia says: "Most of the activities of the X-37B project are secret." Presumably that includes some of the things that would bring about bad press.
andyjohnson0 2y ago
As I recall, the Starliner contract was fixed cost and the X-37 was cost plus. Its not a new observation that the space and defence part of Boeing struggles with the former after decades of the latter. But also, and obviously, Starliner is crew-rated and X-37 isn't. That introduces a lot of additional design and test complexity, as well as more conservative operational decision-making.
- rtkwe 2y ago
  If I had to put one thing as the major boost in difficulty it'd be the crew rating. It's a lot easier to build a craft when it doesn't need to hold and maintain a breathable atmosphere.
InTheArena 2y ago
A with almost every defense contract, X-37 is cost plus and classified, which means that Boeing has been passing the costs on to the USA tax payer rather then have to pay for their mistakes. It’s possible that the program is perfectly run and on budget, but no transparency exists to validate that.
voxadam 2y ago
Beyond cost vs cost-plus contracts I wonder if part of it might be that the X-37 was designed by qualified engineers at Boeing while Starliner was co-designed with members of the US Congress.

b_davis_ 2y ago

i find it very 'rich' that a crowd that would never accept firm fixed price work (we do 'agile', it has to be flexible .. we need time to explore options ...) is so down on cost plus. 'cost plus' is not infinite money. there is a budget, performance is evaluated every quarter. every increase is reviewed. the additional money has to be appropriated. firm fixed price is how the government buys low risk. For lack of a better analogy, a waterfall development. Requirements are clear, the technology is well known. From the beginning. cost plus is how the government buys systems that have never been made before.

dylan604 2y ago
> Requirements are clear, the technology is well known. From the beginning. Is that really a true statement, even for Starliner? The US Gov't is infamous for changing plans/designs well into the process for many items which is the key reason for cost overruns and blown deadlines. I didn't follow Starliner's development process at all, but I would be shocked if from the beginning the requirements didn't change.
- b_davis_ 2y ago
  that mismatch between risk / requirements and the type of contract is the root of this whole problem. if it was cost plus, the government would have had an incentive to no push for changes, since they would have been paying for it. and yes, Boeing should have said no. but, politics.
  - jjk166 2y ago
    Requirement changes on cost plus contracts are endemic. And it's not one way - typically the pipeline is starting to work on the project with requirement A under the assumption it will cost X, find out a decent way through that it's going to cost way more than X, then change to requirements B under the assumption it will only cost Y, repeat two or three times.

deleted 2y ago

[deleted]

daft_pink 2y ago

Maybe they should apply for a grant from usaid