Boeing CEO bemoans Air Force One overruns
David Calhoun says the fixed-price deal his company agreed to with former President Trump probably should not have been done
Boeing shares decline amid ongoing jet delays
FOX Business host Stuart Varney discusses Boeing and Chipotle stocks during the opening bell.
Boeing CEO David Calhoun signaled Wednesday that he is not a fan of the deal the company made under former President Trump to produce the new Air Force One planes, bemoaning the fixed price now that inputs costs have soared.
The Boeing logo is seen at their headquarters in Chicago. (REUTERS/Jim Young / Reuters Photos)
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| BA | THE BOEING CO. | 140.19 | +2.05 | +1.48% |
The agreement signed with the White House in 2018 was made under different leadership at Boeing, and Calhoun, who was on the board at the time, was asked about it during the company's earnings call after posting a $1.2 billion first quarter loss – including a $660 million write-down for the Air Force One fleet.
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"I will have a very different philosophy with respect to fixed price development," Calhoun said. "So I don't expect, and I hope never to contribute to that issue."
Boeing CEO David L. Calhoun, is introduced shortly before President Donald Trump and Chinese Vice Premier Liu He, signed phase 1 of a trade deal between the U.S. and China, in the East Room at the White House, on January 15, 2020, in Washington, DC. (Photo by Mark Wilson/Getty Images / Getty Images)
"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 should not have taken," Calhoun explained, "but we are where we are, and we’re going to deliver great airplanes."
The $3.9 billion deal to convert two Boeing 747 jets into flying presidential offices was negotiated by former CEO Dennis Muilenburg, and the Trump administration boasted at the time that the agreement would save taxpayers upwards of $1.4 billion.
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Muilenberg was fired the next year amid fallout from two deadly crashes of Boeing 737 Max jets.
Dennis Muilenburg, then-president and CEO of the Boeing Company, testifies before the House Transportation and Infrastructure Committee October 30, 2019, on Capitol Hill in Washington, DC. (Alex Wong/Getty Images / Getty Images)
Meanwhile, deliver of the planes, originally slated for December 24, has faced a series of delays due in part to COVID-19 and supply chain issues.
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According to a report from Breaking Defense last month, Boeing now expects to deliver the planes up to 17 months late.
The Associated Press contributed to this report.