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Boeing's CEO is lamenting the deal that his company cut with former President
Donald Trump to produce new Air Force One jets.
 
David Calhoun said "it was a public negotiation and we took some risks in
accepting a fixed-price contract that made Boeing responsible if it cost more
than expected to convert two Boeing 747 jumbo jets into presidential planes."
 
"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 said Wednesday, "but we are where we are, and we're going to
deliver great airplanes.”
 
Calhoun commented on the planes when an analyst asked him about the matter
during a call to discuss Boeing's first-quarter earnings results. The company
lost $1.2 billion and took a $660 million write-down for Air Force One.
 
Calhoun was on the board but he was not CEO when Boeing agreed to the $3.9
billion deal with the White House in 2018, and when it took a fixed-cost
contract to build a new military training jet, which Boeing just wrote down by
$367 million.
 
"Yes, they were written off the day we took them, knowing that we would be
investing a fair amount of our own money in the planes", Calhoun said.
 
Back in 2018, Boeing tweeted that it was proud to build the next generation of
Air Force One, providing American presidents with a flying White House at
outstanding value to taxpayers. The Trump White House said the deal would save
taxpayers more than $1.4 billion.
 
The jets are being outfitted with advanced communications equipment, work
spaces, sleeping areas and other features that make it a flying office for the
president. The work is taking place in San Antonio, Texas.
 
Boeing sued a subcontractor that it blamed for delays last year. On Wednesday,
Boeing officials said the pandemic and supply-chain issues have also slowed
the work.
 
It's unclear what the planes will look like. Trump took a keen interest in the
planes and even promoted his own paint job which is still displayed on
Boeing's website. However, many purists have called for keeping the current
livery, which dates to the time of President John F. Kennedy. Air Force
officials said last fall that no decision had been made.
 
Boeing promised to deliver the planes by December 2024 under a contract
negotiated by then-CEO Dennis Muilenburg, who was fired in late 2019 in the
fallout from two deadly crashes of Boeing 737 Max jets. Calhoun said he
doesn't want any more fixed-price contracts.

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