After one of its most challenging years in recent history, Boeing Co (NYSE:BA) faces a pivotal 2025 as it works to rebuild confidence and stabilize operations under new leadership.
The aerospace giant weathered multiple crises in 2024, from safety incidents to labor disputes, while its stock declined nearly 32% amid ongoing concerns about production quality and delivery delays.
The year began with a serious setback when an Alaska Airlines 737 MAX 9 experienced a door plug blowout in January, leading to an emergency grounding of the aircraft type and triggering a Justice Department criminal investigation. The incident’s fallout ultimately led to the March announcement that CEO Dave Calhoun and board chairman Larry Kellner would step down, marking a significant leadership transition for the troubled manufacturer.
Under new CEO Kelly Ortberg, appointed in July, Boeing faced additional challenges as machinists launched their first strike since 2008 in September. The labor dispute, which ended in November with workers securing a 38% pay rise over four years, forced the company to announce 17,000 job cuts and delay deliveries of its new 777X airliner.
October proved particularly difficult as Boeing recorded $5 billion in losses for the third quarter and initiated a substantial $19 billion share sale to address mounting cash-flow concerns.
Boeing’s Strategic Moves to Regain Control
In a strategic move to gain greater control over its supply chain, Boeing reacquired Spirit AeroSystems (NYSE:SPR) for $4.7 billion in June. The company also secured a significant victory in December with a major order from Pegasus Airlines for up to 200 737 MAX aircraft, providing a much-needed boost to confidence in the aircraft program.
The company’s focus on stabilizing production and improving quality control became paramount throughout the year. Boeing worked toward achieving a stable production rate of 38 aircraft per month for the 737 MAX, though this target was pushed into 2025 due to ongoing challenges and the strike’s impact.
Boeing in 2025: What’s the Outlook?
Looking ahead to 2025, Boeing faces a critical year of potential recovery. The company’s priorities include ramping up production of both the 737 MAX and 787 widebody aircraft, delivering the delayed 777X, and returning its defense business to profitability.
Market analysts emphasize that success will largely depend on Boeing’s ability to implement comprehensive production reforms and enhance quality control measures.
With new leadership at the helm, Boeing is expected to balance immediate operational challenges with longer-term strategic goals, including the development of next-generation aircraft. However, the company’s primary focus remains on rebuilding industry confidence and restoring its reputation while improving cash flow and managing its substantial debt load.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.