The Boeing Company started in 1916, when American lumber industrialist
William E. Boeing founded Pacific Aero Products Company in Seattle, Washington. Shortly before doing so, he and Conrad Westervelt created the
"B&W" seaplane.[13] In 1917, the organization was renamed Boeing Airplane Company, with William Boeing forming Boeing Airplane & Transport Corporation in 1928.[14] In 1929, the company was renamed
United Aircraft and Transport Corporation, followed by the acquisition of several aircraft makers such as Avion, Chance
Vought,
Sikorsky Aviation,
Stearman Aircraft,
Pratt & Whitney, and Hamilton Metalplane.[2]
In 1931, the group merged its four smaller airlines into
United Airlines. In 1934, aircraft manufacturing was required to be separate from air transportation.[15] Therefore, Boeing Airplane Company became one of three major groups to arise from the dissolution of United Aircraft and Transport; the other two entities were
United Aircraft (later
United Technologies) and United Airlines.[2][15]
In 1960, the company bought
Vertol Aircraft Corporation, which at the time, was the biggest independent manufacturer of
helicopters.[16] During the 1960s and 1970s, the company diversified into industries such as outer space travel, marine craft, agriculture, energy production and transit systems.[2]
Sea Launch
In 1995, Boeing partnered with Russian, Ukrainian, and Anglo-Norwegian organizations to create
Sea Launch, a company providing commercial launch services sending satellites to geostationary orbit from floating platforms.[17] In 2000, Boeing acquired the satellite segment of
Hughes Electronics.[2][18]
Merger with McDonnell Douglas
In December 1996, Boeing announced its intention to merge with
McDonnell Douglas, which, following regulatory approval, was completed on August 4, 1997.[19] The delay was caused by objections from the
European Commission, which ultimately placed three conditions on the merger: exclusivity agreements with three US airlines would be terminated, separate accounts would be maintained for the McDonnell-Douglas civil aircraft business, and some defense patents were to be made available to competitors.[20] In 2020, Quartz reported that after the merger there was a "clash of corporate cultures, where Boeing's engineers and McDonnell Douglas's bean-counters went head-to-head", which the latter won, and that this may have contributed to the events leading up to the 737 MAX crash crisis.[21]
Corporate headquarters moves
Boeing's corporate headquarters moved from Seattle to Chicago in 2001.[22] In 2018, the company opened its first factory in Europe at
Sheffield, UK, reinforced by a research partnership with the
University of Sheffield.[23]
In May 2020, the company cut over 12,000 jobs due to the drop in air travel during the
COVID-19 pandemic with plans for a total 10% cut of its workforce or approximately 16,000 positions.[24] In July 2020, Boeing reported a loss of $2.4 billion as a result of the pandemic and the
Boeing 737 MAX groundings, and that it was in response planning to make more job and production cuts.[25] On August 18, 2020, CEO Dave Calhoun announced further job cuts;[26] on October 28, 2020, nearly 30,000 employees were laid off, as the airplane manufacturer was increasingly losing money due to the COVID-19 pandemic.[27]
In May 2022, Boeing announced plans to move its global headquarters from Chicago to
Arlington, Virginia, a suburb of Washington, D.C. The company said that this decision was made in part to concentrate on its defense work with "proximity to our customers and stakeholders."[28][29] After the January 2024
Alaska Airlines Flight 1282 and other incidents, one shareholder proposed relocating the corporate headquarters back to the Seattle area in hopes of getting engineering and quality control teams on-site access to key decision-makers. Boeing's board soundly dismissed the attempt.[30][31]
In February 2023, Boeing announced plans for laying off approximately 2,000 of its workers from finances and human resources.[32]
In May 2023, Boeing acquired autonomous
eVTOL air taxi startup
Wisk Aero.[33]
In June 2024, Boeing bought Spirit AeroSystems, its longtime supplier of airplane parts. The deal was initially discussed in March of the same year before being closed on June 30 at $4.7 billion.[34]
Divisions
The company's three divisions are: Commercial Airplanes; Defense, Space & Security; and Global Services.[35]
Boeing Defense, Space & Security (BDS) builds military airplanes, rotorcraft, and missiles, as well as space systems for both commercial and military customers, including satellites, spacecraft, and rockets.
Boeing Global Services (BGS) provides aftermarket support, such as maintenance and upgrades, to customers who purchase equipment from BCA, BDS, or other manufacturers.
In
2018 and
2019, two
Boeing 737 MAX narrow-body passenger airplanes crashed, leaving 346 people dead and no survivors. In response, aviation regulators and airlines around the world
grounded all 737 MAX airliners.[36] A total of 387 aircraft were grounded.[37] Boeing's reputation, business, and financial rating suffered after the groundings, as Boeing's strategy, governance, and focus on profits and cost efficiency were questioned.[38][39][40] In 2022,
Netflix released an exposé, Downfall: The Case Against Boeing, claiming Boeing's corporate merger with McDonnell Douglas led to the crashes through a disintegration of workplace
morale.[41][42][43][44][45]
In June 2020, the
Federal Aviation Administration found several 737 MAX defects that Boeing deferred to fix, in violation of
regulations.[46] In September 2020, the
U.S. House of Representatives concluded its own investigation and cited numerous instances where Boeing dismissed employee concerns with a 737 MAX flight stabilizing feature (
MCAS) that caused the two fatal accidents, prioritized deadline and budget constraints over
safety, and lacked transparency in disclosing essential information to the FAA. It further found that the assumption that
simulator training would not be necessary had "diminished safety, minimized the value of
pilot training, and inhibited technical design improvements".[47] On January 7, 2021, Boeing
settled to pay over $2.5 billion after being charged with fraud over the company's hiding of information from the safety regulators: a
criminal monetary penalty of $243.6 million, $1.77 billion of damages to airline customers, and a $500 million crash-victim beneficiaries fund.[48]
In September 2022, Boeing was ordered to pay a further $200 million over charges of misleading investors about safety issues related to these crashes.[49] In March 2023, Boeing disputed in court filings that the victims of
Ethiopian Airlines Flight 302 (the 2019 crash) experienced any pain and suffering in the final six minutes as the plane was nosediving into the ground, citing "speed of sound" as a defence. Boeing's claim was described as "preposterous" by HuffPost:[50]
Passengers aboard the plane, the plaintiffs argued in court, "undeniably suffered horrific emotional distress, pain and suffering, and physical impact/injury while they endured extreme G-forces, braced for impact, knew the airplane was malfunctioning, and ultimately plummeted nose-down to the ground at terrifying speed."
While the investigations into the crashes of the 737 MAX were proceeding, the
Boeing 777X, the company's largest capacity twin jet and the largest ever built, made its maiden flight on January 25, 2020,[51] but also experienced problems. Following an incident during
flight testing in 2021, the estimated first delivery of the aircraft was delayed until 2024.[52] After
further technical problems were discovered in the aircraft in 2022, the release was delayed again until 2025, six years after the original date.[53][54]
On January 5, 2024, on
Alaska Airlines Flight 1282, a door plug blowout[55][56] occurred on a
737 MAX 9 jetliner after the plane had reached just over 16,000 feet, leaving a
door-sized hole in the fuselage and the aircraft made an emergency landing at
Portland International Airport successfully with several people onboard injured, although all had subsequently been "medically cleared".[57] The FAA mandated immediate inspections of all 737 MAX 9s fitted with door plugs,
thereby grounding 171 aircraft.[58][59][60]United Airlines found loose bolts on jets grounded by the FAA, raising questions about possible systemic problems with the Boeing 737 MAX 9.[61] The FAA announced on January 12 that it was expanding its scrutiny of Boeing, with a production audit of the 737 MAX 9.[62] On February 6, the
National Transportation Safety Board released a preliminary report indicating that four bolts used to secure the panel had been removed, and appeared not to have been replaced, at Boeing’s factory in
Renton, Washington.[63]
In March 2024, the Justice Department opened a criminal investigation into the Alaska Airlines blowout.[64] In March 2024, CEO Dave Calhoun and board chairman Larry Kellner both announced they would be stepping down from their positions.[65]
Environmental record
In 2006, the
UCLA Center for Environmental Risk Reduction released a study showing that Boeing's
Santa Susana Field Laboratory, a site that was a former Rocketdyne test and development site in the
Simi Hills of eastern
Ventura County in
Southern California, had been contaminated by Rocketdyne with
toxic and
radioactive waste. Boeing agreed to a cleanup agreement with the EPA in 2017.[66] Clean-up studies and lawsuits are in progress.[67]
On July 19, 2022, Boeing announced a renewed partnership with Mitsubishi to produce
carbon-neutral and sustainable solutions.[68]
The airline industry is responsible for about 11% of
greenhouse gases emitted by the U.S. transportation sector.[69] Aviation's share of the greenhouse gas emissions was poised to grow, as air travel increases and ground vehicles use more alternative fuels like
ethanol and
biodiesel.[69] Boeing estimates that
biofuels could reduce flight-related greenhouse-gas emissions by 60 to 80%.[69] The solution blends algae fuels with existing
jet fuel.[69]
Boeing executives said the company was collaborating with Brazilian biofuels maker
Tecbio,
Aquaflow Bionomic of New Zealand, and other fuel developers around the world. As of 2007, Boeing had tested six fuels from these companies, and expected to test 20 fuels "by the time we're done evaluating them".[69] Boeing also joined other aviation-related members in the
Algal Biomass Organization (ABO) in June 2008.[70]
Air New Zealand and Boeing are researching the
jatropha plant to see if it is a sustainable alternative to conventional fuel.[71] A two-hour test flight using a 50–50 mixture of the new biofuel with
Jet A-1 in a Rolls-Royce RB-211 engine of a 747–400 was completed on December 30, 2008.[72] The engine was then removed to be studied to identify any differences between the Jatropha blend and regular Jet A1. No effects on performances were found.[72]
Political contributions, federal contracts, advocacy
In 2008 and 2009, Boeing was second on the list of
Top 100 US Federal Contractors, with contracts totaling US$22 billion and US$23 billion respectively.[73][74] Between 1995 and early 2021, the company agreed to pay US$4.3 billion to settle 84 instances of misconduct, including US$615 million in 2006 in relation to illegal hiring of government officials and improper use of proprietary information.[75][76][77]
Boeing secured the highest-ever
tax breaks at the state level in 2013.[78]
Boeing's spent US$16.9 million on
lobbying expenditures in 2009.[79][80] In the
2008 presidential election,
Barack Obama "was by far the biggest recipient of campaign contributions from Boeing employees and executives, hauling in US$197,000 – five times as much as
John McCain, and more than the top eight Republicans combined".[81]
The company is a member of the
U.S. Global Leadership Coalition, a Washington D.C.-based coalition of more than 400 major companies and NGOs that advocate a larger International Affairs Budget, which funds American diplomatic and development efforts abroad.[84] A series of
U.S. diplomatic cables show how U.S. diplomats and senior politicians intervene on behalf of Boeing to help boost the company's sales.[85]
In 2007 and 2008, the company benefited from over US$10 billion of long-term loan guarantees, helping finance the purchase of their commercial aircraft in countries including Brazil, Canada, Ireland, and the
United Arab Emirates, from the
Export-Import Bank of the United States, some 65% of the total loan guarantees the bank made in the period.[86]
Criticism
In December 2011, the non-partisan organization
Public Campaign criticized Boeing for spending US$52.29 million on
lobbying and
not paying taxes during 2008–2010, instead getting US$178 million in
tax rebates, despite making a profit of US$9.7 billion, laying off 14,862 workers since 2008, and increasing
executive pay by 31% to US$41.9 million in 2010 for its top five executives.[87]
Boeing has been accused of unethical practices (in violation of the
Procurement Integrity Act) while attempting to submit a revised bid to
NASA for their lunar landing project.[88]
War profiteering
The firm has been criticized for
supplying and profiting from wars, including
the war in Yemen where its missiles were found to be used for indiscriminate attacks, killing many civilians.[89][90] In 2017 Boeing signed a deal with
Saudi Arabia which included Saudi Arabia buying military aircraft and guided missile systems.[91]
Between 2010 and 2018, Boeing increased its operating
cash flow from $3 to $15.3billion, sustaining its
share price, by negotiating
advance payments from customers and delaying payments to its suppliers. This strategy is sustainable only as long as orders are good and delivery rates are increasing.[123]
From 2013 to 2019, Boeing spent over $60 billion on dividends and
stock buybacks, twice as much as the development costs of the 787.[124]
In 2020, Boeing's second quarter revenue was $11.8 billion as a result of the pandemic slump. Due to higher sales in other divisions and an influx in deliveries of commercial jetliners in 2021, second quarter revenue increased by 44%, reaching nearly $17 billion.[125]
Revenues decreased 15 percent to $16.9 billion in the second quarter of 2024, compared to the same time period in 2023.[126] The company's operating loss amounted to $1.39 billion and its net loss to $1.43 billion, while plane deliveries fell to 92 (from 136 in 2023).
Approximately 1.5% of Boeing employees are in the
Technical Fellowship program, a program through which Boeing's top engineers and scientists set technical direction for the company.[128] The average salary at Boeing is $76,784, reported by former employees.[129]
Corporate governance
In 2022,
Rory Kennedy made a documentary film, Downfall: The Case Against Boeing, streamed by
Netflix.[41] She said about the 21st-century history of Boeing "There were many decades when Boeing did extraordinary things by focusing on excellence and safety and ingenuity. Those three virtues were seen as the key to profit. It could work, and beautifully. And then they were taken over by a group that decided Wall Street was the end-all, be-all."[42]
On May 5, 2022, Boeing announced that it would be moving its headquarters from Chicago to Arlington, Virginia in the Washington, D.C. metropolitan area. Additionally, it plans to add a research and technology center in
Northern Virginia.[130]
As of 2022[update], Boeing is headed by a President who also serves as the chief executive officer. The roles of chair of the board and CEO were separated in October 2019.[132]
^Syme, Pete.
"Boeing's board shut down a shareholder's bid to move its headquarters back to Seattle". Business Insider.
Archived from the original on March 12, 2024. Retrieved March 12, 2024. Federal Aviation Administration released the findings of its resulting investigation into Boeing… said there is "a disconnect between Boeing's senior management and other members of the organization on safety culture." Many critics have pointed to Boeing moving its headquarters to Chicago in 2001 as the start of a decline. The company is now headquartered in Virginia, and the 737 Max factory is near Seattle.
^Tkacik, Maureen (September 18, 2019).
"Crash Course". The New Republic.
ISSN0028-6583.
Archived from the original on September 19, 2019. Retrieved September 19, 2019.
Cloud, Dana L. (2011). We Are the Union: Democratic Unionism and Dissent at Boeing. Urbana, IL: University of Illinois Press.
ISBN9780252036378.
OCLC816419078.
Sell, Terry M. (2015). Wings of Power: Boeing and the Politics of Growth in the Northwest. Seattle: University of Washington Press.
ISBN9780295996257.
OCLC1313788352.