Boeing & Airbus: Making Money or Losing Money?
Comparing the net profit of rival airplane makers Boeing and Airbus over the past couple of years, one of the two has made money, while the other has lost money almost consistently. The company mostly in the red, Boeing, has been plagued by safety issues repeatedly, which had a very negative effect on its reputation and bottom line. In August, the company's new CEO Kelly Ortberg took over, trying to get the company back on track. In October, the company still announced their biggest quarterly loss since 2020. It was more than $6 billion in the red in Q3 of 2024.
Two deadly crashes in late 2018 and early 2019 in Ethiopia and Indonesia of Boeing 737 Max planes hit the company hard and led to the grounding of all airplanes of the type lasting more than 1.5 years. Boeing lost billions from fines and even more from canceled orders and posted a loss of almost almost $3 billion in Q2 of 2019. The airplanes were finally cleared to fly again in late 2020 after changes were made to the flight control system, which was deemed poorly designed, and training manuals were updated. These issues, together with demand struggles in the coronavirus pandemic that affected Airbus as well, caused Boeing to lose almost $12 billion in 2020, the most in Q4 of that year ($8 billion).
Two years after the 737 Max issue boiled over, Boeing hit another snag, this time concerning a different plane model, the 787 Dreamliner. Due to production problems, the company had to hold planes back from delivery and redo certain parts. This caused another major dip in the company's profit in Q4 2021 of more than $4 billion, while assorted problems in commercial jets and the defense business caused another substantial loss in Q3 of 2022 of $3.3 billion. Now the issues on the 737 Max have been back in the spotlight since early 2024 when a door blew off an Alaska Airlines plane during take-off. This led to decreased production and contributed to losses hitting $1.4 billion in Q2 and $6.2 billion in Q3 of 2024 once more.
A wider critique of Boeing and attempt at an explanation for the continued safety issues is that cost-cutting and a lack of leadership consistency led to design and construction shortcuts that are now surfacing en masse. Airbus meanwhile has been back in the black since 2021. Its biggest loss quarter over the past 5.5 years was Q4 of 2019, when the company had to pay a huge fine in a corruption case.