Boeing Faces Challenges in 2024: Projected Significant Losses, Strikes, and Rising Costs

Boeing’s stock dipped 0.21% to $178.07 following disappointing Q4 2024 forecasts, predicting $15.2 billion in revenue and a $5.46 per share loss, both below analyst expectations. The company faced a $1.1 billion charge in commercial aviation and a $1.7 billion charge in defense due to a prolonged strike by 33,000 workers. With only 348 aircraft delivered in 2024, the lowest since the pandemic, Boeing’s CEO highlighted efforts to stabilize operations as the company prepares for its final results on January 28.

Boeing Faces Challenges with Disappointing Q4 Results

Boeing’s stock has seen a slight decline of 0.21% to $178.07 on Wall Street, largely in response to the company’s disappointing preliminary results for the fourth quarter of 2024. The aerospace giant is forecasting revenues of $15.2 billion along with a significant loss of $5.46 per share. This projection has fallen short of the FactSet analysts’ consensus, which had expected revenues of $16.55 billion and a net loss of just $1.55 per share. Additionally, Boeing reported a substantial charge of $1.1 billion in its commercial aviation sector.

The situation is compounded by a $1.7 billion charge in its Defense, Space, and Services division. Boeing attributed these setbacks to the impact of a more than fifty-day strike involving approximately 33,000 workers at two of its Seattle-area factories.

Production and Delivery Setbacks

In a recent announcement, Boeing revealed that it delivered only 348 aircraft in 2024, a stark contrast to the 523 delivered in 2023. This marks the lowest delivery rate since the onset of the Covid-19 pandemic and is significantly below the 766 aircraft delivered by its European rival, Airbus.

Boeing’s CEO, Kelly Ortberg, addressed the company’s current challenges, stating, “Although we are facing short-term challenges, we have undertaken significant actions to stabilize our business during the quarter, including reaching a labor agreement with the machinists’ union (IAM) and successfully completing a capital increase to improve our balance sheet.” This statement was made in light of the difficult circumstances the company is navigating.

Following the conclusion of the strike in mid-December 2024, Stephanie Pope, CEO of Boeing Commercial Airplanes, confirmed via social media that production of the 737, 767, 777, and 777X aircraft had resumed. The strike ended in early November after workers voted in favor of a wage agreement, with the IAM machinists’ union approving a new management offer by a margin of 59%. This deal included a notable 38% salary increase over four years, up from the previously proposed 35%, along with performance and productivity bonuses.

As the year began, Boeing was also confronted with a series of setbacks, including an in-flight incident involving a 737 Max 9 aircraft from Alaska Airlines, which was forced to make an emergency landing due to the loss of an evacuation door.

Investors and analysts are eagerly awaiting Boeing’s final results for 2024, which are set to be released on January 28.

Related Articles