Boeing It revealed on Wednesday that it lost $1.1 billion in costs related to its deal with the Trump administration to retrofit two 747 jumbo jets to serve as Air Force One — and CEO Dave Calhoun admitted that the airline giant “maybe” shouldn’t have struck the deal in the first place.
Boeing warned in a regulatory filing that more losses to the Air Force One contract could come in future quarters.
Air Force One is the official designation for any aircraft carrying the President of the United States.
“Airplane, I would call it a very unique moment, a very unique negotiation, and a unique set of risks that Boeing probably shouldn’t have taken,” Calhoun said in a call with analysts.
“But we’ve got where we are, and we’re going to deliver great planes,” Calhoun said shortly after. Boeing reported a loss in the first quarter of 2022.
“And we will realize the costs associated with that.”
Boeing on Wednesday reported a net loss of $1.2 billion in the first quarter, at a cost of $660 million linked to delays and higher costs of the presidential program.
US President Donald Trump arrives from a day trip to Georgia aboard Air Force One at Joint Base Andrews in Maryland, US, July 15, 2020.
Jonathan Ernst | Reuters
The company said first-quarter fees on the Air Force One program bring the total loss associated with the program to more than $1.1 billion.
“There remains a risk that we may have to record additional losses in future periods,” Boeing said in a securities filing.
Boeing’s deal for Air Force One was cut short by then-CEO Dennis Muilenburg and then-President Donald Trump in February 2018.
It requires Boeing, not the federal government, to eat up the costs of any cost overruns to modify the two Boeing 747 aircraft.
Under this fixed-price contract, Boeing is charging about $4 billion for the work.
Trump boasted in 2018 that “Boeing gave us a good deal. And we were able to accept that.”
Four years ago, Boeing spoke favorably about the deal.
“Boeing is proud to build the next generation of Air Force One, providing American presidents with a flying white house at an outstanding value to taxpayers,” she wrote on Twitter in February 2018.
Trump also told CBS News That the planes would do away with Air Force One’s traditional blue color scheme in favor of “red, white, and blue, which I think is appropriate.”
Air Force One is going to be great, Trump said at the time. “You’ll be on top of the list, top of the world.”
A month after being elected president in November 2016, Trump took to Twitter about the “out of control” costs of the then-Boeing deal to build the new Air Force One.
“Cancelling order!” Trump tweeted at the time.
He later bragged that his negotiations with Muilenburg saved taxpayers $1.5 billion.
Boeing shot Muilenburg as CEO in December 2019 for how he handled two crashes of 737 Max planes that killed 346 people.
It was reject the termination package, Boeing said a month after he was fired, but it got $60 million in pensions and company stock.
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