Ten years ago, NASA awarded Boeing a $4.2 billion contract and SpaceX a $2.6 billion contract to develop crewed launch vehicles. Boeing has had limited success. Meanwhile, SpaceX has completed nine crewed launches for NASA so far, and its tenth will be to rescue the astronauts stranded by Boeing.
Boeing is exploring a sale of its space business, which includes the underperforming Starliner space vehicle and its operations supporting the International Space Station, according to people familiar with the matter. And though some people believe that a sale won’t happen, it would be the best thing for Boeing. Boeing has fallen behind in the aerospace industry and desperately needs to sell its space division.
Delays have hampered the company’s Defense and Space division, leading to a $3.1 billion loss in the first three quarters of 2024.
A big portion of the loss comes from its failed Starliner program, which has cost the company around $1.85 billion. It’s a shocking amount, considering they’ve been working on this spacecraft for over ten years.
On top of that, Boeing is facing problems elsewhere. The company’s biggest labor union has turned down two contract proposals, extending a strike that is now in its fifth week. With 33,000 workers at its civil plane-making division on strike, production of the popular 737 MAX jets, 767, and 777 widebody planes has come to a halt.
With Boeing facing growing financial troubles, it would be best for the company to cut its losses and sell, especially since the space division has become a burden.
The new CEO of Boeing, Kelly Ortberg, told investors on a call last week, “We’re better off doing less and doing it better than doing more and not doing it well.”
Though some might say that Boeing has been essential to space exploration, especially with projects like the Apollo missions, they overlook that Boeing’s recent attempts in the space division have been unsuccessful. Space exploration is a distraction, and Boeing should focus on airplane manufacturing instead.
If the company decides to sell its space business, a potential buyer could be Blue Origin, owned by Jeff Bezos. Boeing has had past talks with Blue Origin about taking over some of its NASA programs.
Other companies have taken over Boeing’s role in the space industry, so losing the company won’t heavily impact the aerospace industry. For example, SpaceX recently became NASA’s main partner. NASA even chose to use SpaceX’s Crew Dragon to transport astronauts after Boeing’s Starliner encountered problems during its first crewed flight.
Therefore, selling its space division would allow Boeing to refocus on its strengths in commercial aviation while leaving aerospace companies that are better equipped to handle the industry’s demands.
