Boeing’s CEO says the company should have refused Donald Trump’s Air Force One deal that has so far cost it $660m to build two presidential airplanes.
Dave Calhoun spoke frankly about the company’s huge loss on converting two 747 airliners for the White House on a quarterly earnings call on Wednesday.
“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.
“But we are where we are, and we’re going to deliver great airplanes. And we’re going to recognise the costs associated with it.”
The former president, who has owned private jets and even an airline throughout his business career, got personally involved in the negotiations for replacing Air Force One.
And he got the company to agree to a fixed-price contract, with Boeing not US taxpayers covering any overspend on the conversion of the two airliners.
Dennis Muilenburg, who personally negotiated the deal with Mr Trump, was fired as Boeing CEO in 2019.
The Air Force’s fiscal 2019 budget proposal estimated the cost of the planes at $4bn, while Mr Trump claimed he had saved the White House $1bn on the deal.
Mr Trump had criticised an existing deal while still president-elect, even tweeting “Cancel order” in December 2016 before he was sworn into office.
Last September, Boeing launched an investigation after two empty tequila bottles were found onboard one of the planes being converted at a Boeing facility in San Antonio, Texas.
The planes were originally due to be delivered in 2024, but Boeing was forced to delay that date until 2025, citing pandemic-related delays and the firing of a subcontractor.
Boeing also said that it was delaying the introduction of its 777X passenger jey until 2025 as it posed a net loss of $1.2bn in the first quarter of 2022.
The company had intended on delivering the 777X to customers in late 2023.
