China’s first large homegrown passenger jet made its inaugural commercial flight on Sunday, flying from Shanghai to Beijing, Chinese state news agency Xinhua reported.
Flying as China Eastern Airlines flight MU9191, the new narrow-body C919 plane left Shanghai at 10:32 a.m. local time. It was welcomed with a water salute after it landed at the Beijing Capital International Airport at 12:31 p.m.
After years of research and development, the launch of the C919 is seen as a pivotal moment in Beijing’s “Made in China 2025” strategy, which aims to boost local manufacturing, including by reducing reliance on foreign airplanes for its aviation sector.
“The first commercial flight is a coming-of-age ceremony of the new aircraft, and C919 will get better and better if it stands the test of the market,” said Zhang Xiaoguang, director of the marketing and sales department of COMAC, in a Xinhua report.
With a range of up to 5,555 kilometers (3,452 miles), the C919 will take on the world’s two major aircraft manufacturers, Airbus and Boeing. It will be a direct competitor to their A320 and B737 narrowbody jets, most commonly used for domestic and regional international flights.
Built by COMAC (Commercial Aircraft Corporation of China) in China, the first C919 was delivered to China Eastern Airlines in December 2022 and in the months since has been put through a series of test flights.
The single-aisle, twin-engined aircraft has 164 seats in a two-class cabin configuration consisting of business and economy seats.
According to the 2022 Shanghai Science and Technology Progress Report issued by the Shanghai government, 32 clients had placed a total of 1,035 orders for the plane as of the end of 2022.
Many of the plane’s major elements such as the nose, fuselage, outer wing, vertical stabilizer and horizontal stabilizer were designed by COMAC.
However, the company enlisted Western companies to assist with some components. This includes the plane’s LEAP-1C engines, which were developed by CFM International, a joint venture between General Electric and French high-tech industrial group Safran.
US Space Force General B. Chance Saltzman, Chief of Space Operations, testifies about the Fiscal Year 2024 Budget request during a Senate Armed Services Subcommittee on Strategic Forces hearing on Capitol Hill in Washington, DC, March 14, 2023. (Photo by SAUL LOEB / AFP) (Photo by SAUL LOEB/AFP via Getty Images)
Saul Loeb | Afp | Getty Images
When Gen. Chance Saltzman took the stage for his keynote at the Space Symposium in Colorado Springs, Colorado, this week, his message was simple: The U.S. is in a new era of space activity.
“The threats that we face to our on-orbit capabilities from our strategic competitors has grown substantially,” Saltzman, the U.S. Space Force’s second-ever chief of space operations, said in a CNBC interview after the speech. “The congestion we’re seeing in space with tracked objects and the number of satellite payloads, and just the launches themselves, have grown at an exponential rate.”
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“I want to make sure that we are thinking about our processes and procedures differently,” he said in an interview for CNBC’s “Manifest Space” podcast, his first broadcast interview since becoming the service’s highest-ranking military official last November.
The message comes at a key moment as space rapidly commercializes and a heightened geopolitical backdrop increasingly sees threats extending beyond Earth to a domain for which rules of engagement remain unclear.
Follow and listen to CNBC’s “Manifest Space” podcast, hosted by Morgan Brennan, wherever you get your podcasts.
Military experts say space is likely to be the front line in any future conflicts – a battlefield that could extend to the private sector and impact civilians in real time. Look no further than Russia’s invasion of Ukraine as an example: Recall the unprecedented cyberattack on the European communications network of U.S. satellite operator Viasat just as Russian soldiers mobilized to cross sovereign boundaries.
Saltzman said the space-based tactics of adversaries like Russia and China run the gamut, from the communications jamming of the GPS constellation; to lasers and “dazzlers” that interfere with cameras on-orbit to prevent imagery collection; to anti-satellite missiles like the one Russia tested in late 2021.
“We’re seeing satellites that actually can grab another satellite, grapple with it and pull it out of its operational orbit. These are all capabilities they’re demonstrating on-orbit today, and so the mix of these weapons and the pace with which they’ve been developed are very concerning,” he said.
It speaks to why, despite a wave of fervent debate, the Space Force was briskly stood up in 2019 as the first new branch of the U.S. armed services in seven decades.
To respond to evolving threats and secure space assets more quickly, Saltzman is looking to further augment the service’s capabilities to make satellite constellations more resilient and acquire more launch services by tapping into a burgeoning cadre of commercial space players.
Case in point: the Space Force’s recently announced procurement strategy for more launch services. The new “dual-lane acquisition approach” is intended to create more opportunities for rocket startups to compete for national security launch contracts.
With business to be awarded next year, the National Security Space Launch Phase 3 is estimated to run into the billions of dollars and is expected to draw bids from the likes of Rocket Lab, Relativity Space and Jeff Bezos‘ Blue Origin, among others. Phase 2 awards went to SpaceX and United Launch Alliance, a joint venture of Lockheed Martin and Boeing.
An expanding budget helps, too. While still just a fraction of the country’s overall defense budget, the Space Force’s $30 billion request for fiscal 2024 represents a 15% increase from this year’s enacted levels.
“This is a team sport and none of us is going to be successful going in alone,” Saltzman said.
“Manifest Space,” hosted by CNBC’s Morgan Brennan, focuses on the billionaires and brains behind the ever-expanding opportunities beyond our atmosphere. Brennan holds conversations with the megamoguls, industry leaders and startups in today’s satellite, space and defense industries. In “Manifest Space,” sit back, relax and prepare for liftoff.
Boeing’s latest setback with production issues means airlines will have fewer planes than they expected to handle big crowds of travelers this summer.
CEO David Calhoun said Tuesday that inspections and repairs related to unapproved fuselage parts will prevent the company from delivering dozens of 737 Max jetliners to airlines in time for the summer season. But it won’t affect plans to increase the production rate for the best-selling plane, he said.
Calhoun said during Boeing’s annual shareholder meeting that delivery delays will remove about 9,000 seats from airline schedules this summer.
The CEO didn’t give the number of planes used in that calculation, but the number of seats typically in a mid-sized Max suggests that about 50 planes are expected to be delivered late.
The situation is reminiscent of last year, when production flaws stopped Boeing from delivering bigger 787 planes, and airlines dropped some flights and routes.
Boeing hopes to boost production of the Max, which was halted in late 2019 after two of the planes were involved in crashes in Indonesia and Ethiopia that killed a total of 346 people. Production has not yet returned to pre-crash rates.
Boeing disclosed last week that subcontractor Spirit AeroSystems used a “non-standard manufacturing process” on fittings where the tail is attached to the fuselage of most models of Max jets built since 2019. Boeing said then that the issue could cause delays in production and deliveries of a “significant number” of the planes.
Calhoun repeated the company’s position that the fittings do not present a safety issue for planes already carrying passengers. The Federal Aviation Administration has not ordered airlines to do anything with those jets.
Boeing said preliminary results showed that its shareholders elected the 13 board nominees put forward by the company, which lost $5 billion last year and nearly $22 billion since the start of 2019.
Shareholders asked when the company might restore a dividend, which was suspended in early 2020. Calhoun and Chairman Lawrence Kellner said they want to invest in the business and reduce debt before returning more money to shareholders.
Boeing shares gained 1.6% and Spirit AeroSystems rose 7.8% Tuesday.
Arlington, Virginia-based Boeing is scheduled to report first-quarter results April 26.
Virgin Orbit started as a program of Richard Branson’s Virgin Galactic in 2012, before being spun off into a separate company five years later.
In the private space race, Virgin Orbit contended its method of launching its rockets — known as “air launch” — was more flexible than traditional launch pads used by competitors like Rocket Lab, Astra and SpaceX.
The company employed a modified Boeing 747 jet that it called “Cosmic Girl” to carry its LauncherOne rocket to about 35,000 feet of altitude before dropping it.
From there, the rocket would fire its engines and fly off into space.
“By launching from an aircraft, Virgin could take off from almost any airport around the world and turn these airports into space ports,” said Caleb Henry, director of research at Quilty Analytics.
Henry noted that the Virgin Orbit’s last launch was from the United Kingdom, and that the company was in discussions to launch in Japan and Brazil.
“They were offering to different countries the ability to, in a sense, have a sovereign launch capability, because the rocket would take off from their home soil,” Henry said.
But Virgin Orbit was dogged by delays. The company originally hoped to launch its debut mission in 2018, but didn’t get off the ground until May of 2020. The demonstration mission failed shortly after the rocket was released. In total, the company launched six missions, four of which were successful and two of which failed, including the last one in January.
Virgin Orbit’s biggest deal was a 39-launch contract signed with satellite maker OneWeb in 2015. OneWeb ultimately pulled out of the deal without conducting a single launch.
“A challenge for the company, and for any launch company, is having an anchor customer, somebody who you can depend on to routinely buy a decent number of launches,” Henry said. “Virgin Orbit did not have an anchor customer.”
In late March, Virgin Orbit said it was laying off the majority of its workforce and ceasing operations “for the foreseeable future” after failing to secure a funding lifeline. Days later, the company filed for bankruptcy.
Watch the video to find out more about what led to Virgin Orbit’s collapse.
The world record for the farthest flight by paper airplane has been broken by three aerospace engineers with a paper aircraft that flew a grand total of 289 feet, 9 inches (88 meters), nearly the length of an American football field.
They beat the previous record of 252 feet, 7 inches (77 meters) achieved on April 2022 by a trio in South Korea. Prior to that, the record had not been broken in over a decade.
“It really put things on the map and it’s a really proud moment for family and friends,” said Dillon Ruble, a systems engineer at Boeing and now paper airplane record holder, in a release. “It’s a good tie in to aerospace and thinking along the lines of designing and creating prototypes.”
Ruble worked alongside Garrett Jensen, a strength engineer also with Boeing, and aerospace engineer Nathaniel Erickson. The trio are recent graduates who studied aerospace engineering and mechanical engineering at Missouri University of Science and Technology.
The feat required months of effort, as the team put in nearly 500 hours of studying origami and aerodynamics to create and test multiple prototypes. The engineers put their final design to the test on December 2, 2022, in Crown Point, Indiana, where the record was achieved on Ruble’s third throw.
“We hope this record stands for quite a while — 290 feet (88 meters) is unreal,” Jensen said in the release. “That’s 14 to 15 feet (4.2 to 4.6 meters) over the farthest throw we ever did. It took a lot of planning and a lot of skill to beat the previous record.”
The team had decided their best chance at beating the world record would be with an airplane design that focused on speed and minimized drag, so that the plane could fly a far distance in a short amount of time.
Gathering inspiration from various hypersonic aircrafts, vehicles that can fly faster than five times the speed of sound (Mach 5), specifically the NASA X-43A, the team had come up with the winning paper aircraft design — later named “Mach 5.”
“Full-scale and paper airplanes have vast differences in their complexity, but both operate on the same fundamental principles,” said Ruble, via email. “Some of the same design methodologies can be applied to both. One of these methods was our trial-and-error design process. For instance, we would theorize about a fold we could change on our plane, fold it, throw it, and compare the distance to previous iterations to determine if the change was beneficial.”
To find the best technique when it came to throwing the paper airplane, the team ran various simulations and analyzed slow-motion videos of their previous throws.
“We found the optimal angle is about 40 degrees off the ground. Once you’re aiming that high, you throw as hard as possible. That gives us our best distance,” Jensen said in the statement. “It took simulations to figure that out. I didn’t think we could get useful data from a simulation on a paper airplane. Turns out, we could.”
Even down to the paper, which the team had decided that A4 (slightly longer than typical letter sized paper) was the best for manipulating and folding into the winning airplane. With these meticulously thought-out design choices, and careful attention to the numerous rules and guidelines set forth by the Guinness World Record Team, the three were set to break a record.
On its record-breaking distance flight the plane was in the air for roughly six seconds. The Guinness paper plane record for duration of flight is currently 29.2 seconds.
“The design objectives for an air-time record would be vastly different from the low-drag version we built for the longest-distance record,” Ruble said via email. “Increasing the wingspan and decreasing the aspect ratio would be the first steps in producing this type of plane.”
Paper airplane aside, Ruble added that this tedious method of back-and-forth trials served as a testament to the importance of rigorous prototyping in the real world.
Ruble and Jensen began their paper plane engineering careers while in middle school, participating in paper airplane events held at Boeing. Ruble said he enjoyed making the paper come to life and the hard work he had to put in to find ways to improve his designs. Both were also fans of origami as kids.
The record-breaking team hopes their accomplishment will inspire other young and aspiring aerospace engineers to chase their dreams.
For those looking to create their own record-breaking paper plane design, the feat is not impossible, but may take some time (and skill).
“Mach 5 flies best at high relative velocity, but to achieve this condition, the aircraft must be launched in a specific manner,” said Ruble via email. “This technique, in addition to the complexity of the plane, means that only the most experienced paper aircraft enthusiasts would have success with the design.
“However, by starting with publicly available designs, anyone can hone their skills to throw paper airplanes farther and higher than all of their friends,” he added.
Boeing 737 Max airplanes sit parked at the company’s production facility on November 18, 2020 in Renton, Washington.
David Ryder | Getty Images
Boeing on Thursday warned it will likely have to reduce deliveries of its 737 Max airplane in the near term because of a problem with a part made by supplier Spirit AeroSystems.
Boeing said its supplier informed the company a “non-standard” manufacturing process was used on two fittings in aft fuselages. It said the issue affects certain 737 Max 8 planes, the company’s most popular model, with customers including American Airlines and Southwest Airlines. It also affects certain 737 Max 7, the 737 8200 and P-8 planes.
Boeing said the problem was not an “immediate safety of flight issue and the in-service fleet can continue operating safely.”
Boeing has notified the Federal Aviation Administration of the issue and is working to inspect and address the fuselages as needed, the company said. The FAA said Boeing notified it of the issue and also said there is no immediate safety issue.
However, the issue will likely affect a significant number of undelivered 737 Max airplanes, both in production and in storage,” the manufacturer said in a statement.
“We expect lower near-term 737 MAX deliveries while this required work is completed. We regret the impact that this issue will have on affected customers and are in contact with them concerning their delivery schedule,” Boeing said in a statement. “We will provide additional information in the days and weeks ahead as we better understand the delivery impacts.”
The problem, the most recent in a string of production issues, hits Boeing as it scrambles to increase production and deliveries of its best-selling plane while customers await new jetliners to capitalize on a rebound in travel.
Shares of Boeing were down 6% in premarket trading Friday. Shares of Spirit AeroSystems were down roughly 14%.
Spirit manufacturers some of the fuselages used in Boeing jets and said in a statement it notified Boeing of a “quality issue” with certain 737 models.
“Spirit is working to develop an inspection and repair for the affected fuselages. We continue to coordinate closely with our customer to resolve this matter and minimize impacts while maintaining our focus on safety,” the company said.
It’s the latest production problem for Boeing and its customers. Boeing earlier this year paused deliveries of its 787 Dreamliners for several weeks to address a data analysis flaw, and in 2021 and 2022 it struggled with other production flaws on the wide-body jets that halted deliveries for months.
The company on Tuesday reported March deliveries of 64 planes, the highest tally since December, amid an industry-wide shortage of new jets.
Airline executives have cited aircraft supply constraints as among the chief challenges in ramping up flying ahead of the peak travel season.
“We’re aware of the issue and working with Boeing to understand how it may impact our MAX deliveries,” an American Airlines spokesman said in statement.
Southwest said in a statement that it expects the issue to impact its delivery schedule of new Max planes and that it is discussing the details of that timeline for this year “and beyond.”
United said it didn’t expect any “significant impact” to its capacity planes for this summer or the rest of 2023.
— CNBC’s Leslie Josephs and Phil LeBeau contributed to this report.
Virgin Orbit crew poses at the opening bell ceremony as a 70 foot model rocket with satellites is placed in front of the NASDAQ in Times Square of New York City, United States on January 7, 2022.
Tayfun Coskun | Anadolu Agency | Getty Images
Not too long ago, Virgin Orbit was in rarified air among U.S. rocket builders, and executives were in New York celebrating its public stock debut.
The scene was true to the marketing pizazz that has helped Sir Richard Branson build his Virgin empire of companies, showcasing with a rocket model in the middle of Times Square.
The deal, facilitated by a so-called blank check company, gave Virgin Orbit a valuation of nearly $4 billion. But that moment in December 2021 – when the craze surrounding public offerings centered on special purpose acquisition companies, or SPACs, was dying out – previewed the pain to come.
Now, Virgin Orbit is on the brink of bankruptcy. The company on Thursday halted operations and laid off nearly all of its staff. Its stock was trading around 20 cents Friday, leaving it with a market value of about $74 million.
When Virgin Orbit closed its SPAC deal, it raised less than half of the nearly $500 million expected due to high shareholder redemptions, shortening its runway. With the broader markets turning against riskier yet-unprofitable assets like many new space stocks, Virgin Orbit shares began a steady slide, further limiting its ability to raise substantial outside investment.
Branson, Virgin Orbit’s largest stakeholder, was unwilling to fund the company further, as CNBC previously reported. Instead, he began hedging against his 75% equity stake through a series of debt rounds. That debt gives the flashy British billionaire first priority of Virgin Orbit assets in the event of the now-impending bankruptcy.
While Virgin Orbit touted a flexible and alternative approach to launch small satellites, the company was unable to reach the rate of launches necessary to generate the revenue it sorely needed.
Virgin Orbit’s technical staff acquitted themselves well over the company’s brief existence, but were ultimately undone in by its leaders’ financial mismanagement. It’s a story too often told in the history of the space industry: Exciting, or even innovative, technologies do not necessarily equal great businesses.
It became one of a few U.S. rocket companies to successfully reach orbit with a privately developed launch vehicle. It launched six missions since 2020 — with four successes and two failures — through an ambitious and technically difficult process known as “air launch,” with a system that uses a modified 747 jet to drop a rocket mid-flight and send small satellites into space.
But Virgin Orbit had dug a nearly $1 billion hole, flying missions just twice a year while its payroll expenses climbed. The company’s leadership was aware of the deteriorating situation and lack of progress, and even considered changes last summer to make the business more lean. But no clear or dramatic plan came to fruition – leading to Thursday’s fall.
This story collects insights from CNBC’s discussions with company insiders and industry investors over the past several weeks, as well as from regulatory disclosures, to explain where things went wrong for Virgin Orbit. Those people asked to remain anonymous in order to discuss internal or competitive matters.
A Virgin Orbit spokesperson declined to comment for this story.
The company’s 747 jet “Cosmic Girl” releases a LauncherOne rocket in mid-air for the first time during a drop test in July 2019.
Greg Robinson / Virgin Orbit
Virgin Orbit was spun-off from Branson’s space tourism company, Virgin Galactic, in 2017, after a team within the latter sister company saw potential in using an aircraft as a platform to launch satellites. While “air launching” satellites was not a novel idea to Virgin Orbit, the company aimed to surpass the air-launched Pegasus rocket – developed by Orbital Sciences, which is now owned by Northrop Grumman –for a fraction of the cost per mission.
Headquartered in Long Beach, California, Virgin Orbit flew most of its missions out of the Mojave Air and Space Port. The exception to that was its most recent launch, which took off from Spaceport Cornwall in the United Kingdom. Virgin Orbit had been working with other governments to provide launches by flying out of airports around the world, signing agreements with Japan, Brazil, Australia and the island of Guam.
The advertised flexibility and potential of Virgin Orbit’s approach attracted quite a bit of attention from leaders in the U.S. national security community. Following meetings with top Pentagon brass in 2019, Branson proclaimed that Virgin Orbit is “about the only company in the world that could replace [satellites] in 24 hours” during a military conflict.
At the time, the Air Force’s acquisition lead, Will Roper, said he was “very excited about small launch” after meeting with Branson. He said the U.S. military had “huge money to invest” in buying rocket launches.
The company had hoped to launch its debut mission as early as 2018, but that goal kept moving every six months or so. Eventually, Virgin Orbit launched its first mission in May 2020, which failed shortly after the rocket was released from the jet. It got to orbit successfully for the first time in January 2021.
Given the company’s burn rate near $50 million a quarter, Virgin Orbit was targeting profitability once it got beyond a launch rate, or cadence, of a dozen missions per year. When it went public, Virgin Orbit CEO Dan Hart told CNBC that the company was aiming to launch seven rockets in 2022, to build on that momentum.
At the same time, Virgin Orbit was already in a deep financial hole – with a total deficit of $821 million at the end of 2021, due to steady losses since its inception. While Virgin Orbit had aimed to launch seven missions last year, that number was steadily guided down quarter after quarter, closing out 2022 with just two completed lunches – the same as the year before.
Some people within the company who had been critical of Virgin Orbit’s execution pointed to several executives’ backgrounds at Boeing, which has had its share of space-related snags over the years.
Virgin Orbit CEO Dan Hart had spent 34 years at Boeing, where he was previously the vice president of its government space systems. COO Tony Gingiss joined Virgin Orbit from satellite broadband company OneWeb, but before that had spent 14 years in Boeing’s satellite division. And Chief Strategy Officer Jim Simpson had also spent more than eight years in Boeing’s satellite division before joining Virgin Orbit.
As one person emphasized, the company launched the same amount of rockets in a year with a staff of 500 as it did with a workforce of over 750 people. Others complained of a lack of cross-department coordination, with projects and spending done in silo of each other – leading to a disconnect in schedules.
Two people mentioned wastefulness in ordering materials. For example: The company would buy enough expensive items with limited shelf-life to build a dozen or more rockets, but then only build two, meaning it would have to throw away millions of dollars’ worth of raw materials away.
When Virgin Orbit announced an employee furlough March 15, people familiar with the situation said the company had about half a dozen rockets in various states of production in its Long Beach factory.
As the lack of a financial lifeline made the situation increasingly more desperate, multiple Virgin Orbit employees voiced frustration with how Hart communicated the company’s position – and even more so with the lack of clarity after the furlough.
The day of the initial pause in operations, people described company leadership running around frantically while many employees stood around waiting for word on what was happening. One person emphasized the tumultuous and sudden furlough happened because executives tried to keep the company alive as long as possible. Several employees expressed disappointment with Hart holding the March 15 all-hands meeting virtually, speaking from his office rather than face-to-face, and not taking any questions after announcing the pause in operations.
That frustration continued after the pause, with employees confused by the lack of specifics about which investors were speaking to Virgin Orbit leadership. Thursday’s update that a deal fell through came as little surprise to a workforce that was largely in limbo. Many were already hunting for new jobs.
The rocket for the company’s second demonstration mission undergoing final assembly at its factory in Long Beach, California.
Virgin Orbit
A pivot in Virgin Orbit’s strategy became apparent and necessary shortly after it went public.
Virgin Orbit aimed to raise $483 million through its SPAC process, but significant redemptions meant it raised less than half of that, bringing in $228 million in gross proceeds. The funds it did raise came from the minority of SPAC shareholders who stuck around, as well as private investments from Virgin Group, the Emirati sovereign wealth fund Mubadala, Boeing, and AE Industrial Partners.
Unlike its sister company Virgin Galactic, which built its cash reserves to more than $1 billion through stock and debt sales after going public in October 2019, Virgin Orbit did not build its cash coffers. And that meant leadership should have buckled down and made changes to run the company in a more lean way, one person emphasized, to rebuild momentum.
And then Virgin Orbit’s apparent strength in the national security sector began to falter. Despite half of its missions flying Space Force satellites, the company lost out to competitor Firefly Aerospace for a launch contract under the “Tactically Responsive Space” program. Awarded in October, the mission seemed right up Virgin Orbit’s alley, especially since the prior mission under that Space Force program flew on the similarly air-launched Pegasus rocket.
As the financial situation worsened, a few bankers who spoke to CNBC wondered why the search for a deal was dragging on. According to one banker, Virgin Orbit could raise anywhere from $10 million to $15 million quickly to stop-gap the situation while it found a larger buyer. Another investor estimated that Virgin Orbit had about $270 million in net tangible assets, further sweetening the potential for a wholesale deal even despite its plunging market value.
A white knight seemed to appear last week in the form of Matthew Brown, who discussed making an 11th-hour deal with Virgin Orbit, to reportedly inject as much as $200 million into the company. However, within days, the talks fell apart. The company continued to discussions with another, unnamed investor this past week.
But in the words of Hart on Thursday, Virgin Orbit was “not been able to secure the funding to provide a clear path for this company.”
And while the 675 employees laid off Thursday likely have strong job prospects, Virgin Orbit seems now destined for bankruptcy.
Boeing’s lineup of unmanned, undersea vehicles (UUV) can operate autonomously for months at a time on a hybrid rechargeable propulsion power system. Pictured above is the 18-foot Echo Ranger. The aerospace and defense contractor also makes the 32-foot Echo Seeker, and its latest innovation, and the largest autonomous sub, is the Voyager at 51-feet.
Boeing
More than 80% of the ocean remains unexplored by humans but could soon be mapped by autonomous underwater robots. But is that all unmanned submarines will be used for?
Autonomous robot submarines — also referred to as autonomous underwater vehicles, or AUVs — are able to explore high-pressure areas of the ocean floor that are unreachable by humans through preprogrammed missions, allowing them to function without humans aboard, or controlling them. They’re often used by scientists for underwater research as well as oil and gas companies for deep water surveys, but as defensive security threats continue to grow, the largest sector in the AUV market has become the military.
AUVs can be helpful tools in military ocean exploration, obtaining critical information such as mapping the seafloor, looking for mines — a current use case in the Russia-Ukraine war — and supplying underwater surveillance. Navies worldwide are investing in unmanned underwater vehicles to elevate their fleet of below-water defense tools.
Defense company Anduril Industries kickstarted its expansion from land to sea when it acquired AUV manufacturer Dive Technologies in February. The acquisition gave them a customizable AUV of their own called the Dive-LD.
“There are more and more threats that are on top of the water and under the water that can really only be addressed by robotic systems that can hide from enemy surveillance, that can hide from what you can see in the air and can do things that are only possible to do underwater,” Palmer Luckey, Anduril Industries co-founder, told CNBC’s “Squawk on the Street” at the time of the acquisition.
In addition to the Dive Technologies acquisition, Anduril Industries expanded to Australia in March, then in May partnered with the Australian Defense Force to work on a $100 million project to design and create three extra large AUVs for the Royal Australian Navy.
In the U.K., the Royal Navy recently ordered its first AUV named Cetus XLUUV from MSubs, which is expected to be completed in about two years. The U.K.’s Ministry of Defence also announced in August the donation of six autonomous underwater drones to Ukraine to aid in their fight against Russia by locating and identifying Russian mines.
China recently completed construction on the Zhu Hai Yun, an unmanned ship made to launch drones and that utilizes artificial intelligence to navigate the seas with no crew required. The ship is described by officials in Beijing as a research tool, but many experts expect it to also be used for military purposes.
Boeing has been working on AUVs since the 1970s and has collaborated with the United States Navy and DARPA on a number of underwater vehicle projects in recent years. The Echo Voyager, Boeing’s first extra-large unmanned undersea vehicle, first began operating in 2017 after about five years of design and development. It’s 51-feet long with a 34-foot payload that is approximately the size of a school bus and can be used for oil and gas exploration, long-duration surveying and analyzing infrastructure for oil and gas companies.
Boeing’s latest unmanned, undersea vehicle (UUV), the 51-foot Echo Voyager.
Boeing
The AUV has spent almost 10,000 hours operating at sea and has transited hundreds of nautical miles autonomously. It’s versatile and modular, Ann Stevens, the senior director of Maritime Undersea at Boeing, said in an interview.
“There is no other vehicle of that size and capability in the world, Echo Voyager is the only one,” Stevens said.
Boeing has been in the process of developing the Orca XLUUV with funding from the United States Navy. The company won a $43 million contract to build four of the AUVs, which are based off of the design of Boeing’s Echo Voyager, in February 2019. The project has experienced some production delays – the Orca XLUUVs that were originally scheduled to be delivered in December 2020 are now planned to be finished in 2024. The company cited cost concerns as well as supply chain issues due to the pandemic as reasons for the change.
“It’s a development program, and we’re developing groundbreaking technology that’s never been built before,” Stevens said. “We’ve been in lock step with the Navy the whole way. We’re going to have a great vehicle that comes out the other end.”
Robotics and automation in general is a young field, according to Maani Ghaffari, an assistant professor in the Naval Architecture and Marine Engineering department at the University of Michigan. Researchers began developing AUVs around 50-60 years ago, though the quality and variety of sensors that were necessary to build the systems were limited. Today, sensors are smaller, cheaper and higher quality.
“We are at the stage where we can build much better and more efficient hardware and sensors for the robots to the extent that we’re hoping to deploy some of them in everyday life at some point,” Ghaffari said.
AUVs still have some challenges to overcome before they’re a feasible mechanism for everyday use, for one, the robots have to function in an arguably harsher environment than air, where the water’s higher density creates hydraulic drag that slows down the robot and drains its battery faster.
However, some AUVs in development have impressive speeds and endurance. When it is completed, Boeing said it expects the Orca XLUUV to sail 6,500 nautical miles without being connected to another ship. Anduril reports that the Dive-LD can be sent on missions autonomously for up to 10 days and is made to last for weeks-long missions.
Environmental challenges are the main problem spots for AUVs. Underwater communication from the unmanned submarines is limited as signals used to transfer messages in air get absorbed quickly in water, and cameras on the vehicles are not as clear underwater.
Whether AUVs will eventually be used as more than a surveillance tool and engage in underwater warfare is more of a question of ethics within artificial intelligence and robotics, Ghaffari said. While the vehicles may be sophisticated enough to make autonomous decisions, concerns arise when the decisions may impact human lives.
“The one idea is that you basically pass the battle to these robots instead of soldiers – less people might die, but on the other hand, when the artificial intelligence can make decisions faster than humans and act faster than humans, that might increase the amount of damage that they can cause,” Ghaffari said. “That’s the frontier that hasn’t been explored, and we have to talk about it as we make progress in the future.”
A long-exposure photograph shows SpaceX’s Falcon 9 rocket carrying the Crew-6 mission in the company’s
Joel Kowsky / NASA
SpaceX launched four people to the International Space Station from Florida as Elon Musk’s company begins the final of the original six missions it was awarded by NASA.
Known as Crew-6, the mission for NASA will bring the group up to the space station for a six-month stay in orbit. The mission is SpaceX’s sixth operational crew launch for NASA to date and the company’s ninth human spaceflight to date.
“If you enjoyed your ride, please don’t forget to give us five stars,” SpaceX mission control called out after the capsule reached orbit.
“That was fantastic, thank you,” Crew-6 commander Stephen Bowen responded.
Crew-6 launched a little after midnight on Thursday morning, beginning a just over 24-hour journey to the ISS. The mission brings the number of astronauts SpaceX has launched to 34, including both government and private missions, since its first crewed launch in May 2020.
The Crew-6 astronauts before launch, from left: Russian cosmonaut
SpaceX
The crew is made of two Americans, one Russian and one Emirati: NASA astronauts Warren Hoburg and Stephen Bowen, Roscosmos cosmonaut Andrey Fedyaev and United Arab Emirates astronaut Sultan Alneyadi.
SpaceX launched the astronauts in its Crew Dragon capsule called Endeavour, on top of a Falcon 9 rocket. Both the rocket and capsule are reusable, with the latter flying on its fourth mission to date.
After a last-minute delay during SpaceX’s first launch attempt on Monday, a data review identified a clogged filter in a ground system as the cause of an apparent issue in the fluid that ignites the rocket’s engines. SpaceX replaced the filter and completed verification steps to make Thursday’s launch.
SpaceX developed its Crew Dragon spacecraft and fine-tuned its Falcon 9 rocket under NASA’s competitive Commercial Crew program, competing against Boeing’s Starliner capsule. But Boeing’s capsule remains in development, with costly delays pushing back the start of operational Starliner flights.
NASA awarded SpaceX with additional missions, for a total of 14, compared with Boeing’s six.
President Joe Biden’s embattled pick to lead the Federal Aviation Administration is scheduled for his confirmation hearing before Congress on Wednesday morning amid a series of challenges for the agency.
Phil Washington is expected to get grilled by senators on issues that have emerged since he was nominated last summer and explain why he’s qualified to lead an agency that urgently needs to address a slew of complex challenges.
The hearing for Washington, whose lack of aviation experience and legal entanglements have raised concerns on Capitol Hill, comes after a year of the FAA operating without a permanent administrator. In that time, the agency has contended with several problems that have plagued travelers and the airline industry, such as recent near-collisions involving airliners, crucial staffing shortages and malfunctions of aging technology that have cause major air travel disruption.
Washington, whose nomination was first announced by Biden nearly eight months ago, will appear before the Senate Committee on Commerce, Science, and Transportation Wednesday at 10 a.m. ET.
Washington, the current CEO of the Denver International Airport, has held leadership roles at municipal transit organizations, including in Denver and Los Angeles, focused on bus and rail lines. He also led the Biden-Harris transition team for the Department of Transportation. Prior to his work in transportation, Washington served in the military for 24 years.
While Washington has worked in transportation-related positions since 2000, he had no experience in the aviation industry prior to joining the Denver airport in 2021. Since his nomination last summer, Washington has faced questions about his limited experience and, in September, was named in a search warrant issued as part of a political corruption investigation in Los Angeles.
According to a questionnaire given to the commerce committee ahead of Wednesday’s hearing, Washington wrote that though his name was mentioned in the search warrant along with several other names, no search was ever executed on him or his property, nor was he questioned about the matter.
Washington’s name was also recently mentioned in a federal lawsuit filed earlier this month. Benjamin Juarez, a former parking director at the Denver Airport, alleges that the city permitted intolerable working conditions and that he faced ongoing threats to his job, Axios reported. Juarez’s attorney says he contacted Washington, who was leading the airport, at least twice for help and did not receive a response.
Texas Republican Sen. Ted Cruz, the ranking Republican on the committee, has asserted that Washington failed to disclose his naming in the lawsuit involving his work at the Denver airport. Republicans have also questioned whether Washington, an Army veteran who left the military in 2000 after more than 20 years of service, would be statutorily considered a civilian – a requirement in order to serve as the FAA chief.
If he’s not considered a civilian, he would need a waiver from Congress permitting him to lead the agency. And Republicans do not support granting Washington a waiver.
A GOP aide on the Senate commerce committee told CNN that Cruz and Senate Republicans expect to raise all these issues – including his legal entanglements, his lack of experience, his management and his possible ineligibility – during Wednesday’s hearing.
They’ll also focus on Washington’s efforts to incorporate diversity, equity, and inclusion in the vendor and contractor process as well as leading efforts “to make it harder and more expensive to drive in Los Angeles to force people to use mass transit instead in order to save mankind from climate change,” according to the aide. Specifically, the aide referenced Washington’s work to pursue a policy which charges drivers for using congested roadways during peak hours.
Senate Majority Leader Chuck Schumer said in January that he would push to confirm Washington.
“There is no doubt about it: it’s time to clear the runway for President Biden’s choice for FAA administrator, Phil Washington. With recent events, including airline troubles and last week’s tech problem, this agency needs a leader confirmed by the Senate immediately,” Schumer said in a statement following a computer system failure that triggered the delay of more than 12,000 flights. “I intend to break this logjam, work to hold a hearing for Mr. Washington, where he can detail his experience and answer questions and then work towards a speedy Senate confirmation.”
The FAA is a sprawling and complex safety, regulatory and operational agency, tasked with regulatory oversight of all civilian aviation in the US.
It’s been without a permanent administrator for about a year, when the Trump-nominated Stephen Dickson stepped down midway through his five-year term. Billy Nolen, the agency’s top safety official, was named acting director in April.
The agency has a professed focus on safety, but agency leadership is ultimately responsible for steering its focus as its mission gets wider – with responsibilities expanding to include establishing the federal approach to private space launches and regulating drones – even as longstanding aspects of the aviation industry continue to grapple with major challenges.
A failure of the 30-year-old NOTAM, or Notice to Air Missions, system led to the first nationwide airplane departure grounding since the 9/11 attacks, showcasing just one way aging industry technology is being stretched beyond its limits by increased volume. Now, the FAA is planning to dramatically accelerate replacing the safety system.
Another FAA computer system failed earlier this year when it was overloaded, leading to delays in Florida. And the agency has struggled to modernize parts of air traffic control, with a 2021 Transportation Department Office of Inspection General report citing difficulties integrating the FAA’s multi-billion dollar Next Generation Air Transportation System project due to extended delays.
There have been recent near-collisions on US runways, prompting federal safety investigators to open multiple inquiries. Air traffic control is staffed at the lowest level in decades, according to industry experts. And key roles at US airlines pared down amid the Covid-19 pandemic have not ramped up to meet current outsized travel demand.
In February, Nolen, the acting chief, ordered a sweeping review of the agency in the wake of recent aviation safety incidents. That review is expected to include a major safety meeting this month.
Another challenge is the FAA’s evolution in how it handles oversight following the Boeing 737 MAX crashes.
Congress created reforms to the FAA’s oversight in a late 2020 law but critics say the agency has been slow to implement changes.
A House Transportation committee investigation into 737 MAX certification found the model of oversight used then “creates inherent conflicts of interest that have jeopardized the safety of the flying public.” The report also concluded senior FAA officials overrode decisions of FAA experts.
The agency is also still trying to resolve an 5G interference issue.
The next generation of cell phone technology can interfere with devices on aircraft that determine how far above the ground the aircraft is – the radar or radio altimeter.
FAA says it brought its concerns to the administration at the time when the Federal Communications Commission was developing plans to auction this portion of spectrum. But now the FAA is trying to play catch up while wireless carriers agreed to voluntarily pause rolling out their new tech around airports.
A sign for hire is posted on the window of a Chipotle restaurant in New York, April 29, 2022.
Shannon Stapleton | Reuters
Job cuts are rising at some of the biggest U.S. companies, but others are still scrambling to hire workers, the result of wild swings in consumer priorities since the Covid pandemic began three years ago.
Tech giants Meta, Amazon and Microsoft, along with companies ranging from Disney to Zoom, have announced job cuts over the past few weeks. In total, U.S.-based employers cut nearly 103,000 jobs in January, the most since September 2020, according to a report released earlier this month from outplacement firm Challenger, Gray & Christmas.
Meanwhile, employers added 517,000 jobs last month, nearly three times the number analysts expected. This points to a labor market that’s still tight, particularly in service sectors that were hit hard earlier in the pandemic, such as restaurants and hotels.
The dynamic is making it even harder to predict the path of the U.S. economy. Consumer spending has remained robust and surprised some economists, despite headwinds such as higher interest rates and persistent inflation.
All of it is part of the Covid pandemic’s “legacy of weirdness,” said David Kelly, global chief strategist at J.P. Morgan Asset Management.
The Bureau of Labor Statistics is scheduled to release its next nonfarm payroll on March 3.
Some analysts and economists warn that weakness in some sectors, strains on household budgets, a drawdown on savings and high interest rates could further fan out job weakness in other sectors, especially if wages don’t keep pace with inflation.
Wages for workers in the leisure and hospitality industry rose to $20.78 per hour in January from $19.42 a year earlier, according to the most recent data from the Bureau of Labor Statistics.
“There’s a difference between saying the labor market is tight and the labor market is strong,” Kelly said.
Many employers have faced challenges in attracting and retaining staff over the past few years, with challenges including workers’ child care needs and competing workplaces that might have better schedules and pay.
With interest rates rising and inflation staying elevated, consumers could pull back spending and spark job losses or reduce hiring needs in otherwise thriving sectors.
“When you lose a job you don’t just lose a job — there’s a multiplier effect,” said Aneta Markowska, chief economist at Jefferies.
That means while there might be trouble in some tech companies, that could translate to lower spending on business travel, or if job loss rises significantly, it could prompt households to pull back sharply on spending on services and other goods.
Some of the recent layoffs have come from companies that beefed up staffing over the course of the pandemic, when remote work and e-commerce were more central to consumer and company spending.
Amazon last month announced 18,000 job cuts across the company. The Seattle-based company employed 1.54 million people at the end of last year, nearly double the number at the end of 2019, just before the pandemic, according to company filings.
Microsoft said it’s cutting 10,000 jobs, about 5% of its workforce. The software giant had 221,000 employees as of the end of June last year, up from 144,000 before the pandemic.
Tech “used to be a grow-at-all-costs sector, and it’s maturing a little bit,” said Michael Gapen, head of U.S. economic research at Bank of America Global Research.
Other companies are still adding employees. Boeing, for example, is planning to hire 10,000 people this year, many of them in manufacturing and engineering. It will also cut around 2,000 corporate jobs, mostly in human resources and finance departments, through layoffs and attrition. The growth aims to help the aerospace giant ramp up output of new aircraft for a rebound in orders with large sales to airlines like United and Air India.
Airlines and aerospace companies were devastated early in the pandemic when travel dried up and are now playing catch-up. Airlines are still scrambling for pilots, a shortage that has limited capacity, while demand for experiences such as travel and dining has surged.
Chipotle is planning to hire 15,000 workers as it gears up for a busier spring season and to support its expansion.
Businesses large and small are also finding they have to raise wages to attract and retain workers. Industries that fell out of favor with consumers and other businesses, such as restaurants and aerospace, are rebuilding workforces after shedding workers. Walmart said it would raise minimum pay for store employees to $14 an hour to attract and retain workers.
The Miner’s Hotel in Butte, Montana, raised hourly pay for housekeepers by $1.50 to $12.50 for that position in the last six weeks because of a high turnover rate, Cassidy Smith, its general manager.
Airports and concessionaires have also been racing to hire workers in the travel rebound. Phoenix Sky Harbor International Airport has been holding monthly job fairs and offers some staff child-care scholarships to help hiring.
Austin-Bergstrom International Airport, where schedules by seats this quarter has grown 48% from the same period of 2019, has launched a number of initiatives, such as $1,000 referral bonuses, and signing and retention incentives for referred staff.
The airport also raised hourly wages for airport facilities representatives from $16.47 in 2022 to $20.68 in 2023.
“Austin has a high cost of living,” said Kevin Russell, the airport’s deputy chief of talent.
He said employee retention has improved.
Electricians, plumbers and heating-and-air conditioning technicians in particular, however, have been difficult to retain because they can work at other places that aren’t 24/7 and at at higher pay, he said.
Many companies’ new workers need to be trained, a time-consuming element for some industries to ramp back up, even if it’s gotten easier to attract new employees.
“Hiring is not a constraint anymore,” Boeing CEO Dave Calhoun said on an earnings call in January. “People are able to hire the people they need. It’s all about the training and ultimately getting them ready to do the sophisticated work that we demand.”
— CNBC’s Amelia Lucas contributed to this article.
Air India will purchase more than 200 planes from Boeing, a White House official says President Joe Biden will announce Tuesday. It’s the third biggest sale of all time for the aircraft manufacturer.
The agreement will include 190 Boeing 737 MAXs, 20 Boeing 787s, and 10 Boeing 777Xs – a total of 220 firm orders valued at a list price of $34 billion, the official says. The purchase will also include customer options for an additional 50 Boeing 737 MAXs and 20 Boeing 787s, totaling 290 airplanes for a total of $45.9 billion at list price.
In a statement, Biden said the sale would “support over one million American jobs across 44 states, and many will not require a four-year college degree.”
“This announcement also reflects the strength of the U.S.-India economic partnership,” the president wrote. “Together with Prime Minister Modi, I look forward to deepening our partnership even further as we continue to confront shared global challenges — creating a more secure and prosperous future for all of our citizens.”
Production will support three separate U.S.-based manufacturing lines, will result in $70 billion in total economic impact across the United States and support an estimated 1.47 million direct and indirect jobs, a White House official said Tuesday.
India has been gaining some manufacturing business as Western tensions flare with China, including major companies that traditionally rely heavily on Chinese production. Apple is one such company, with Minister of Commerce and Industry Piyush Goyal saying the tech giant was already making between 5% and 7% of its products in India.
India is set to overtake China this year to become the world’s most populous country. The country’s massive and cheap labor force, which includes workers with key technical skills, is a big draw for manufacturers. Asia’s third-largest economy also offers a growing domestic market. In 2023, as global recession fears persist, India is expected to remain the fastest growing major economy in the world.
If it can sustain that momentum, India could become only the third country with GDP worth $10 trillion by 2035, according to the Centre for Economics and Business Research.
Boeing’s
(BA) 737 Max has been plagued with problems, but production and orders for the troubled aircraft has picked up, boosted by a massive order from United late last year. In June, Ethiopian Airlines took delivery of a 737 Max from Boeing for the first time since the March 2019 crash that killed all 157 people on board, and led to a 20-month grounding of the jet.
The company has plenty of other troubles in China, the world’s largest aviation market. It has been on the verge of being virtually shut out of the region as trade tensions between the United States and China have basically halted Boeing sales in the country for the last four years. The company has not announced any sales to a Chinese passenger airline since November 2017, and the country banned the Boeing 737 Max for much longer than most countries. A Boeing 737 Max finally took off in China in January for the first time since 2019.
Boeing has faced myriad problems in recent years, beyond the drop in demand for passenger planes that occurred during the pandemic. Delivery of the 787 Dreamliner widebody jets resumed last year after they were halted due to quality control issues.
SEATTLE (AP) — Boeing plans to make staffing cuts in the aerospace company’s finance and human resources departments in 2023, with a loss of around 2,000 jobs, the company said.
“We expect about 2,000 reductions primarily in Finance and HR through a combination of attrition and layoffs,” Boeing said in a statement Monday. “While no one has been notified of job loss, we will continue to share information transparently to allow people to plan.”
The company, which recently relocated its headquarters to Arlington, Virginia, said it expects to “significantly grow” the overall workforce during the year. “We grew Boeing’s workforce by 15,000 last year and plan to hire another 10,000 employees this year with a focus on engineering and manufacturing,” the statement said.
Boeing’s total workforce was 156,000 employees as of Dec. 31, 2022, the company said.
The Seattle Times reported Boeing, which has been one of the largest private employers in Washington state, plans to outsource about a third of the eliminated positions to Tata Consulting Services in Bengaluru, India.
Mike Friedman, a senior director of communications, told the Times the other positions will be eliminated as the company makes reductions in finance and human resources support services.
“Over time, some of our corporate functions have grown quite large. And with that growth tends to come bureaucracy or disparate systems that are inefficient,” Friedman said. “So we’re streamlining.”
The Times reported about 1,500 of the company’s approximately 5,800 finance positions will be cut, with up to 400 more job cuts in human resources, which is about 15% of the department’s total staff.
More than half a century since the original jumbo jet ushered in a glamorous new jet age, helping bring affordable air travel to millions of passengers, the last-ever Boeing 747 was delivered on Tuesday, marking the start of the final chapter for the much-loved airplane.
In a ceremony that was broadcast live online, the aircraft was handed over to its new owner, US air cargo operator Atlas Air, at Boeing’s plant in Everett, Washington.
In a dramatic opening of the hangar’s sliding doors, Atlas Air’s new plane was revealed behind flags bearing the liveries of every carrier that’s ever taken delivery of a 747. The company has 56 of the aircraft in its fleet.
One small significant detail on the last one delivered: a decal right next to the nose paying homage to Joe Sutter, chief engineer of the Boeing 747 program, who died in 2016 and is considered by many as the “father” of this famous aircraft. Members of the Sutter family, as well as members of the Boeing family representing the company’s founder, Bill Boeing, attended the delivery ceremony on Tuesday.
John Dietrich, president and CEO of Atlas Air Worldwide, thanked the assembly of Boeing employees.
“The impact of your work continues well beyond the production lines,” Dietrich said. “It has fueled childhood dreams and career ambitions while at the same time driving global economies and supply chains.”
Dietrich also shared a flight plan spelling out “747” that the new plane is set to fly on Wednesday.
A string of speakers representing companies that have relied on the 747 came to celebrate the aircraft.
“The 747 is a symbol for many, many things, and above all, I think it’s a symbol for the world, which the 747 has made substantially smaller,” said Lufthansa CEO Carsten Spohr.
Actor and pilot John Travolta, who narrated a series of videos chronicling the aircraft’s colorful history, appeared to thank the employees of Boeing for “the most well-thought-out and safest aircraft ever built.”
While the final 747 won’t be carrying paying passengers, its delivery is another milestone for the distinctive double-decker “Queen of the Skies,” which revolutionized intercontinental travel while also appearing in James Bond films and even giving piggyback rides to the Space Shuttle.
With the last passenger 747 having entered service more than five years ago, the end of the 747’s enduring career now moves even closer, hastened by airlines switching their preferences to smaller and more economical aircraft.
Tuesday’s delivery is a moment long anticipated by the global aviation community. Expectant airplane enthusiasts have followed every step of the final 747’s construction, ever since Boeing announced in July 2020 that it was ceasing production of its one-time flagship.
The aircraft, registered as N863GT, made its first public appearance in December, when it was rolled out of the Boeing assembly line covered in anti-corrosive green paint. In early January, photos appeared online of the aircraft, already wearing the Atlas Air livery and the homage to Joe Sutter.
Interestingly for a jet that predates the Apollo Moon landings (it hit the skies a few months earlier, in February 1969), the Boeing 747’s production line has outlasted that of one of its most direct recent competitors, the Airbus A380, which was produced between 2003 and 2021.
It was the introduction of the European double-decker plane in the early 2000s that prompted Boeing to announce, in 2005, one last version of the 747 design that by that time was already starting to show its age.
The B747-8I (or B747-8 Intercontinental), as this last variant of the venerable jumbo jet is called, proved to be a swan song for large four-engined airliners.
Even though the A380 is currently enjoying a revival, with airlines rushing to bring stored aircraft back to service in response to the post-Covid air traffic recovery, these giants of the skies struggle to compete with the operational flexibility and fuel economies of smaller twin-engined jets.
As of December 2022, there are only 44 passenger versions of the 747 still in service, according to aviation analytics firm Cirium. That total is down from more than 130 in service as passenger jets at the end of 2019, just before the pandemic crippled demand for air travel, especially on international routes on which the 747 and other widebody jets were primarily used. Most of those passenger versions of the jets were grounded during the early months of the pandemic and never returned to service.
Lufthansa remains the largest operator of the passenger version of the B747-8, with 19 in its current fleet and potential commitments to keep the jumbo flying passengers for years, possibly decades, to come.
Best of the Boeing 747 jumbo jet: In pictures
The 747 has proven more popular among cargo operators. There are still 314 747 freighters in use, according to Cirium, many of which were initially used as passenger jets before being renovated into freighters.
Features such as the distinctive nose-loading capability, and the cockpit’s elevated position, leaving the whole length of the lower fuselage available to carry large-volume items, have made it a cargo favorite.
Tuesday’s delivery also brings questions about what will happen to Boeing’s vast Everett factory, in which the 747 has been produced since 1967.
This facility was purpose-built for the Boeing 747 and is, according to the company, the largest building in the world by volume. It’s since served as the main production location for Boeing’s wide-body airliners, the 767, 777 and 787 (the best-selling narrow-body 737, however, is produced at Renton, another location in the Seattle area).
Developments in the last few years have been shifting the company’s industrial center of gravity elsewhere.
In addition to losing the B747, Everett recently lost the 787 production line, after Boeing decided to consolidate production at its plant in Charleston, South Carolina.
Boeing continues to make the B767 at Everett, a relatively old model with limited commercial perspectives, as well as the B777, which is currently seeing low production rates, in anticipation of its new version, the B777X. The latter, however, has suffered several delays and it is currently going through a certification and development process that is proving to be much lengthier and complex than expected.
While Boeing hasn’t disclosed much publicly about what it intends to do with the facilities that housed the Boeing 747 final assembly line, in the run up to the final jumbo delivery reports have emerged that they may be used to work on stored B787 Dreamliners.
What’s more, according to these same sources, Boeing may also produce additional B737s in Everett. Production of this bestselling model currently takes place at another facility in Renton, further south in the greater Seattle area.
Despite the fanfare of January 31, there are still two more Boeing 747 deliveries pending – and they’re by no means ordinary.
These are the two new US presidential planes, which are technically called VC-25, even if they’re popularly referred to as “Air Force One” (a call sign that is only used when the US President is on board).
These two planes have already been built, having originally been destined for Russian airline Transaero, which went bankrupt in 2015. The two future Air Force Ones are currently undergoing an extensive program of modifications to prepare them for presidential service.
This nascent bull market started with the peak in interest rates and the dollar back in the fall and then broadened to include bank and semiconductor stocks in 2023. Is it fragile? Is it alchemy? Is it real? We’ll know after we see the quarterly earnings this week from the likes of Club holdings Apple (AAPL), Meta Platforms (META) Alphabet (GOOGL) and Amazon (AMZN), as well as what the Federal Reserve decides at its two-day meeting ending Wednesday and what the monthly nonfarm payroll numbers show Friday. I’m not as concerned as I would normally be though because the critics right now feel like poor picadors to me who would never catch a bull, let alone a matador who would put an end to things. Here’s why: Much if not most of the investing public and the money managers entrusted with their assets stopped believing in this market a long time ago when the Fed let things get out of control for a year because it feared a resurgent Covid. Public health was none of its business but it became its business and it did the best it could do. The revulsion that managers and investors feel started with the free money that then-President Donald Trump gave out, which somehow, got invested in a lot junk. That started a brutal pace of illegitimacy. It was followed up with the wrath of tech and the trillionaire sell-off of FANG and Friends, one that ultimately led to the end of FANG. That’s right we created FANG a decade ago this week on “Mad Money,” and it was a really good call — until it wasn’t. Facebook, now Meta, peaked ages ago and seems almost unimportant. Amazon got so bloated during the pandemic that it must be rightsized or its earnings won’t entitle it to be a growth stock. Netflix (NFLX) was the best of the lot, but your money turned into a pillar of salt if you looked at it at any time since November 2021, the month of the tech-heavy Nasdaq ‘s record high. You could say that about all of the FANG and friends names, including Google, now Alphabet. Apple held up a little longer and didn’t peak until early January 2022 along with the broader market. Oh, and why not include Tesla (TLSA) in the bunch; it deserved its trillionaire-cursed fate. Microsoft (MSFT) and Tesla reported and they appear to be non-events, which is rather incredible when you consider that Microsoft’s forecast came down quite a bit because of the Azure cloud nonetheless, the putative gem of its web services business, and Tesla actually lowered the price of its vehicles, something never thought possible. When Amy Hood, CFO of Club holding Microsoft, dropped the hammer during the post-earnings conference call it looked over. When Elon Musk succumbed to competition, it looked dead. Yet, take a look: Both had excellent weeks. It didn’t matter. It could be the same for Alphabet, Amazon, Apple and Meta this week. That’s important. However, far more important is the lassitude with which we accepted these numbers. There was, indeed, an instant tsunami of selling after Hood dropped Microsoft’s bomb. Tesla’s stock had been going down for months. Other than the media did anyone care? The world is so worn out of fear for these, and the ennui for FANG and friends has transcended fear and gloom. We just don’t care anymore. The Fed? It could surprise us with a 50-basis-points interest rate hike this week. That would be poorly received initially but even that could be swallowed IF accompanied by a simple “done for now” statement. It’s worth noting that the market has over 98% odds on a 25-basis-point increase, according to the CME’s FedWatch tool . There’s even a slim contingent that sees a chance of no action. The nonfarm payroll report? We need to see decent wage-price stabilization — and given the layoffs we have seen — if we don’t get one, we will simply say it’s a matter of time. I know that these words sound like a derisking of the market. But that would be so wrong it’s painful. A decade after FANG what matters is everything else: the ascendancy of American businesses as a whole and all of those broadening bull markets. For example, Boeing (BA) rallied despite the FAA outage, and web stocks rallied despite Azure’s softness. Housing stocks held in because the demand for housing is demographically based and mortgage rates have stabilized, thanks to the inverted yield curve in the bond market, where short-duration rates are higher than longer-dated ones. The prices of new homes have been lowered, but that’s key to the hopefully receding inflation outlook. The key to the strength of this past week’s market was, of all things, Dow stock American Express (AXP). Much to the puzzlement of people who run big swaths of money, Amex’s strength came from millennial users. They are spending on travel and leisure and, most importantly, dinners out. But who can blame them. They are still remembering when they could do nothing during Covid. Plus, they love the points and the service. The Amexes, not the sideshow fintechs created by insane venture capitalists, are the winners. The stability of a market that’s based, in part, on the assumption of a JPMorgan (JPM) or an American Express or even a Boeing rallying on earnings, seems tidal to me. They stand for the broadening of it all, and the fact that it came after a huge overbought condition. That matters. When you study the S & P Oscillator, as I have, you get these confirmative moves when you experience further elevation as the Oscillator returns to the mean. That’s what’s happening as we consider the market to be far bigger than any group of a half-dozen stocks. No one company is important: The asset class prevails. It didn’t even matter that the incompetence of the men who run the machine surfaced again. The market is too strong for their stupidity — and the lack of actual names who were, well, stupid is a welcome sign. In short, we are experiencing the market’s liberation from FANG and friends. Even a miss by Apple can be explained away by the results of the pernicious, Orwellian-style release of people into a country, China, that had told you that Covid was a death sentence and the U.S. vaccines were worthless. You conquer that cynical belief system of the Communist Party with purchases of sneakers from Nike (NKE) and perfumes from Club holding Estee Lauder (EL), a la the lunar new year. You then have a pretty forgiving stance for Apple’s numbers. Undoubtedly, we have to get some bankruptcies soon, preferably by ne’er-do-well retailers and venture capital-backed fintechs and enterprise software firms and those who put money up for them. We need to rein in spending more so that the Fed can begin its period of peace having conquered those who kept paying up for the same thing. We are almost to the point, though not yet, where you can afford to job-hop. Thanks to Chipotle Mexican Grill (CMG) for announcing you need 15,000 people just when we thought the Fed was finishing its work. I guess that’s what burrito season brings us. Can we at least wait for the Super Bowl to be played? Yes, I am painting — without the help of ChatGPT, or its Nvidia (NVDA)-based backbone — a return to the era of no single company having real impact on the entire market, and no one move by the Fed doing so, either. The stalemate in Washington over the debt ceiling has led to the seemingly annual talk about a disastrous default that has always, to this point, been averted. The Fed may go with a completely against consensus 50 and say we aren’t done, stay tuned. We might even have misses among all the majors, but I am portraying a bull that just doesn’t care. It’s a bull that’s based on, not a lack of alternatives, which had been the case for three years, but a plethora of index fund money that follows the surges of whatever moves the needle collectively. You can boil all of this down to the suddenly hackneyed word, resiliency, as in the market is resilient in the face of its broad nature. We wait for the shortfall pronouncements from Apple, Amazon and Alphabet and move on NOT FROM THE STOCK MARKET but to OTHER STOCKS more representative of a resurgent America buoyed by its natural resources, its post-Covid strength, and its central bank that preserves purchasing power . We have the Russians, the Chinese and the Europeans to thank for that sanguine stance. The anticipation of what’s left of the FANG reporting season is simply prurient at this point and not dispositive. The drama is media created but ignored by 401(K) contributions and earmarked pension benefits that are actually being fulfilled. Sound too Panglossian? How about a hard-won battle with the narrowness of the bear that we have suffered from, not even seeming to acknowledge its beginning when the Fed went for preservation not profligacy back in the fall of 2021. The lack of credit to Fed Chairman Jerome Powell and company is astounding to me. But once a doofus always a doofus, from his lack of massive Treasury sales to his crazy cadence of rigor in 2022. Yes, I am shredding the cynicism and heralding the new bull market, one that’s not ignorant of what ails things, but is benignly rotational. The obsession with FANG a decade after its birth is over and that means more money for the rest of the 500 companies in the S & P 500 benchmark index. That’s something the media fails to acknowledge and that will be on display writ large next week. My take? Ignore the sirens of a Circe in Bear uniform. That now unheralded cohort and its despoiled fellow travelers didn’t even make the playoffs, let alone the two conference championships. This is a week we will get through and any decline will be regarded as a clarion call to get in — repulsed only by cynical market prognosticators who insist on being the sound and the fury signifying nothing as the bulls trample on and leave their underinvested legions to starve the once over-served steers. (Jim Cramer’s Charitable Trust is long AAPL, META, GOOGL, AMZN, MSFT, EL, NVDA. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . 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Jim Cramer at NYSE with bull. June 30, 2022.
Virginia Sherwood | CNBC
This nascent bull market started with the peak in interest rates and the dollar back in the fall and then broadened to include bank and semiconductor stocks in 2023. Is it fragile? Is it alchemy? Is it real? We’ll know after we see the quarterly earnings this week from the likes of Club holdings Apple (AAPL), Meta Platforms (META) Alphabet (GOOGL) and Amazon (AMZN), as well as what the Federal Reserve decides at its two-day meeting ending Wednesday and what the monthly nonfarm payroll numbers show Friday.
Corporations are in the thick of earnings season this week and, while reports are mixed, there are good opportunities in some of them for investors, according to Sarat Sethi, portfolio manager at Douglas C. Lane & Associates. Boeing and AT & T are among the big names that posted their numbers Wednesday, following Microsoft, which reported late Tuesday. Going by profit numbers alone, Boeing posted the bleakest report of the three, including a loss for the fourth quarter as labor and supply strains overshadowed an increase in jet demand. “They’ve been supply constrained for a while so I do think it’s an interesting story and the stock is getting punished a little bit, but their demand going forward for travel is getting pretty big,” Sethi said of Boeing on CNBC’s “Squawk Box” Wednesday morning. “The cheaper it gets, for us, the better we like the story.” Sethi, who doesn’t currently own Boeing, also noted the airplane builder was cash flow positive for the first time “in a long time” and he’s eager to see if it can meet its demand and push operating margins higher. Elsewhere, AT & T’s report showed an increase in subscribers, but the company forecasted annual profit below analyst expectations, according to Refinitiv. Still, the investors are looking for companies that, like AT & T, are cheap and will grow cash flow and income, Sethi said. “AT & T is a cheap stock, so is Verizon. … The market is looking to see who has the proper valuation at this point, given where we are with the discount rate,” he said. “That’s going to be really important for our earnings going forward.” “One of the things that we need to watch for now is – companies cannot grow by acquisition, the government is now allowing it,” he added. “That is really tough for companies especially [with] interest rates going up. You have to focus on your customer base, organic growth and what you have given valuation metrics people have.” Those may be better opportunities than a stock like Microsoft, which reported mixed results Tuesday after the bell. The company also said it expects could revenue growth to further slow down. Sethi didn’t say whether he’d sell his shares but that he’s “looking at it very carefully.” “There are going to be other opportunities there,” he said. “I don’t know I would own it in the size that it is in the market. I like the company, there are a lot of attributes – cashflow positive, a lot of recurring revenue. But I think you can look for other opportunities, especially if it’s a sizable position.”
A Boeing 747-8F operated by AirBridgeCargo takes off from Leipzig/Halle Airport.
Jan Woitas | Picture Alliance | Getty Images
Boeing posted a $663 million loss for the fourth quarter as supply chain issues weighed on results despite a rebound in aircraft sales and deliveries that drove up revenue.
Airlines and aircraft manufacturers have benefited from a sharp recovery in air travel, one of the most affected industries from the Covid pandemic. But Boeing’s leaders have been hesitant to ramp up aircraft production until the supply chain has stabilized.
The company is producing 31 of its 737 jets a month and plans to increase that to about 50 per month in 2025 or 2026. It said it would raise what has been low production rate of the 787 Dreamliners to five each month toward the end of the year and to 10 per month in 2025 or 2026. Deliveries of those wide-body planes had been paused for around two years until this summer due to production flaws.
For the full year, Boeing had a loss of $5 billion despite a 7% increase in revenue to $66.6 billion.
Here’s how the company performed in the fourth quarter compared with analysts’ estimates complied by Refinitiv:
Adjusted loss per share: $1.75 vs. expected earnings per share of 26 cents.
Revenue: $19.98 billion vs. $20.38 billion expected.
Boeing generated $3.1 billion in cash flow in the fourth quarter, higher than analyst forecasts, and $2.3 billion for the year, the most since 2018, before the second of two fatal 737 Max crashes that sparked a yearslong crisis for the company.
Its commercial aircraft unit generated $9.2 billion in sales in the fourth quarter, up 94% from a year earlier as deliveries jumped, but it still produced a loss due to abnormal costs and other expenses such as research and development, the company said.
Boeing reiterated its expectation to generate between $3 billion and $5 billion in free cash flow this year.
“We’re proud of how we closed out 2022, and despite the hurdles in front of us, we’re confident in our path ahead,” CEO Dave Calhoun said Wednesday in a memo to employees. “We have a robust pipeline of development programs, we’re innovating for the future and we’re increasing investments to prepare for our next generation of products.”
In the fervor-filled days leading up to the November 16 launch of the long-awaited Artemis I mission, an uncrewed trip around the moon, some industry insiders admitted to having conflicting emotions about the event.
On one hand, there was the thrill of watching NASA take its first steps toward eventually getting humans back to the lunar surface; on the other, a shadow cast by the long and costly process it took to get there.
“I have mixed feelings, though I hope that we have a successful mission,” former NASA astronaut Leroy Chiao said in an opinion roundtable interview with The New York Times. “It is always exciting to see a new vehicle fly. For perspective, we went from creating NASA to landing humans on the moon in just under 11 years. This program has, in one version or another, been ongoing since 2004.”
There have been numerous delays with the development of the rocket at the center of the Artemis I mission: NASA’s Space Launch System (SLS), the most powerful rocket ever flown — and one of the most controversial. The towering launch vehicle was originally expected to take flight in 2016. And the decade-plus that the rocket was in development sparked years of blistering criticism targeted toward the space agency and Boeing, which holds the primary contract for the SLS rocket’s core.
NASA’s Office of Inspector General (OIG) repeatedly called out what it referred to as Boeing’s “poor performance,” as a contributing factor in the billions of dollars in cost overruns and schedule delays that plagued SLS.
“Cost increases and schedule delays of Core Stage development can be traced largely to management, technical, and infrastructure issues driven by Boeing’s poor performance,” one 2018 report from NASA’s OIG, the first in a series of audits the OIG completed surrounding NASA’s management of the SLS program, read. And a report in 2020 laid out similar grievances.
For its part, Boeing has pushed back on the criticism, pointing to rigorous testing requirements and the overall success of the program. The OIG report also included correspondence from NASA, which noted in 2018 that it “had already recognized the opportunity to improve contract performance management” and agreed with the report’s recommendations.
Despite all the heated debate that has followed SLS, by all accounts, the rocket is here to stay. And officials at NASA and Boeing said its first launch two months ago was practically flawless.
“I worked over 50 Space Shuttle launches,” Boeing SLS program manager John Shannon told CNN by phone. “And I don’t ever remember a launch that was as clean as that one was, which for a first-time rocket — especially one that had been through as much as this one through all the testing — really put an exclamation point on how reliable and robust this vehicle really is.”
The Artemis program manager at NASA, Mike Sarafin, also said during a post-launch news conference that the rocket “performed spot-on.”
But with its complicated history and its hefty price tag, SLS could still face detractors in the years to come.
Many have questioned why SLS needs to exist at all. With the estimated cost per launch standing at more than $4 billion for the first four Artemis missions, it’s possible commercial rockets, like the massive Mars rocket SpaceX is building, could get the job done more efficiently, as the chief of space policy at the nonprofit exploration advocacy group Planetary Society, Casey Dreier, recently observed in an article laying out both sides of the SLS argument.
(NASA Administrator Bill Nelson noted that the $4 billion per-launch cost estimate includes development costs that the space agency hopes will be amortized over the course of 10 or more missions.)
Boeing was selected in 2012 to build SLS’s “core stage,” which is the hulking orange fuselage that houses most of the massive engines that give the rocket its first burst of power at liftoff.
Though more than 1,000 companies were involved with designing and building SLS, Boeing’s work involved the largest and most expensive portion of the rocket.
That process began over a decade ago, and when the Artemis program was established in 2019, it gave the rocket its purpose: return humans to the moon, establish a permanent lunar outpost, and, eventually, pave the path toward getting humans to Mars.
But the SLS is no longer the only rocket involved in the program. NASA gave SpaceX a significant role in 2021, giving the company a fixed-price contract for use of its Mars rocket as the vehicle that will ferry astronauts to the lunar surface after they leave Earth and travel to the moon’s orbit on SLS. SpaceX’s forthcoming rocket, called Starship, is also intended to be capable of completing a crewed mission to the moon or Mars on its own. (Starship, it should be noted, is still in the development phases and has not yet been tested in orbit.)
Boeing has repeatedly argued that SLS is essential and capable of performing tasks that other rockets cannot.
“The bottom line is there’s nothing else like the SLS because it was built from the ground up to be human rated,” Shannon said. “It is the only vehicle that can take the Orion spacecraft and the service module to the moon. And that’s the purpose-built design — to take large hardware and humans to cislunar space, and nothing else exists that can do that.”
Starship, meanwhile, is not tailored solely to NASA’s specific lunar goals. SpaceX CEO Elon Musk has talked for more than a decade about his desire to get humans to Mars. More recently, he has said Starship could also be used to house giant space telescopes.
Yet, another reason critics remain skeptical of SLS is because of its origins. The rocket’s conception can be traced back to NASA’s Constellation program, which was a plan to return to the moon mapped out under former President George W. Bush that was later canceled.
But the SLS has survived. Many observers have suggested a big reason was the desire to maintain space industry jobs in certain Congressional districts and to beef up aerospace supply chains.
Much of the criticism levied against SLS, however, has focused on the actual process of getting the rocket built.
At one point in 2019, former NASA administrator Jim Bridenstine considered sidelining the SLS rocket entirely, citing frustrations with the delays.
“At the end of the day, the contractors had an obligation to deliver what NASA had contracted for them to deliver,” Bridenstine told CNN by phone last month. “And I was frustrated like most of America.”
Still, Bridenstine said, when his office reviewed the matter, it found “there were no options that were going to cost less money or take less time than just finishing the SLS” — and the rocket was never ultimately sidelined. (Bridenstine noted he was also publicly critical of delayed projects led by SpaceX and others.)
The SLS rocket ended up flying its first launch more than six years later than originally intended. NASA had allocated $6.2 billion to the SLS program as of 2018, but that price tag more than tripled to $23 billion as of 2022, according to an analysis by the Planetary Society.
Those escalating costs can be traced back to the type of contracts that NASA signed with Boeing and its other major suppliers for SLS. It’s called cost-plus, which puts the financial burden on NASA when projects face cost overruns while still offering contractors extra payments, or award fees.
In testimony before the Senate Appropriations Subcommittee on Science last year, current NASA Administrator Bill Nelson criticized the cost-plus contracting method, calling it a “plague.”
More in vogue are “fixed-price” contracts, which have a firm price cap, like the kind NASA gave to Boeing and SpaceX for its Commercial Crew Program.
In an interview with CNN in December, however, Nelson stood by cost-plus contracting for SLS and Orion, the vehicle that is designed to carry astronauts and rides atop the rocket to space. He said that without that type of contract, in his view, NASA’s private-sector contractors simply wouldn’t be willing to take on a rocket designed for such a specific purpose and exploring deep space. Building a rocket as specific and technically complex as SLS isn’t a risk many private-sector companies are anxious to take on, he noted.
“You really have difficulty in the development of a new and very exquisite spacecraft … on a fixed-price contract,” he said.
“That industry is just not willing to accept that kind of thing, with the exception of the landers,” he added, referring to two other branches of the Artemis program: robotic landers that will deliver cargo to the moon’s surface and SpaceX’s $2.9 billion lunar lander contract. Both of those will use fixed-price — often referred to as “commercial” — contracts.
“And even there, they’re getting a considerable investment by the federal government,” Nelson said.
Still, government watchdogs have not pulled punches when assessing these cost-plus contracts and Boeing’s role.
“We did notice very poor contractor performance on Boeing’s part. There’s poor planning and poor execution,” NASA Inspector General Paul Martin said during testimony before the House’s Subcommittee on Space and Aeronautics last year. “We saw that the cost-plus contracts that NASA had been using…worked to the contractor’s — rather than NASA’s — advantage.”
Shannon, the Boeing executive, acknowledged in an interview that Boeing and SLS have faced loud detractors, but he said that the value of the drawn out development and testing program would become evident as SLS flies.
“I am extremely proud that NASA — even though there were significant schedule pressures — they could set up a test program that was incredibly comprehensive,” he said. “The Boeing team worked through that test process and hit every mark on it. And you see the results. You see a vehicle that is not just visually spectacular, but its performance was spectacular. And it really put us on the road to be able to do lunar exploration again, which is something that’s very important in this country.”
But the rocket is still facing criticism. During a Congressional hearing with the House’s Science, Space, and Technology Committee in March 2022, NASA’s Inspector General said that current cost estimates for SLS were “unsustainable,” gauging that the space agency will have spent $93 billion on the Artemis program from 2012 through September 2025.
Martin, the NASA inspector general, specifically pointed to Boeing as one of the contractors that would need to find “efficiencies” to bring down those costs as the Artemis program moves forward.
In a December 7 statement to CNN, Boeing once again defended SLS and its price point.
“Boeing is and has been committed to improving our processes — both while the program was in its developmental stage and now as it transitions to an operational phase,” the statement read, noting the company already implemented “lessons learned” from building the first rocket to “drive efficiencies from a cost and schedule perspective” for future SLS rockets.
“When adjusted for inflation, NASA has developed SLS for a quarter of the cost of the Saturn V and half the cost of the Space Shuttle,” the statement noted. “These programs have also been essential to investing in the NASA centers, workforce and test facilities that are used by a broad range of civil and commercial partners across NASA and industry.”
The successful launch of SLS was a welcome winning moment for Boeing. Over the past few years, the company has been mired in controversy, including ongoing delays and myriad issues with Starliner, a spacecraft built for NASA’s Commercial Crew Program, and scandal after scandal plaguing its airplane division.
Now that the Artemis I mission has returned safely home, NASA and Boeing can turn to preparing more of the gargantuan SLS rockets to launch even loftier missions.
SLS is slated to launch the Artemis II mission, which will take four astronauts on a journey around the moon, in 2024. From there, SLS will be the backbone of the Artemis III mission that will return humans to the lunar surface for the first time in five decades and a series of increasingly complex missions as NASA works to create its permanent lunar outpost.
Shannon, the Boeing SLS program manager, told CNN that construction of the next two SLS rocket cores is well underway, with the booster for Artemis II on track to be finished in April — more than a year before the mission is scheduled to take off. All of the “major components” for a third SLS rocket are also completed, Shannon added.
For the third SLS core and beyond, Boeing is also moving final assembly to new facilities Florida, freeing up space at its manufacturing facilities to increase production, which may help drive down costs.
Shannon declined to share a specific price point for the new rockets or share any internal pricing goals, though NASA is expected to sign new contracts for the rockets that will launch the Artemis V mission and beyond, which could significantly change the price per launch.
Nelson also told CNN in December that NASA “will be making improvements, and we will find cost savings where we can,” such as with the decision to use commercial contracts for other vehicles under the Artemis program umbrella.
How and whether those contracts bear out remain to be seen: SpaceX needs to get its Starship rocket flying, a massive space station called Gateway needs to come to fruition, and at least some of the robotic lunar landers designed to carry cargo to the moon will need to prove their effectiveness. It’s also not yet clear whether those contracts will result in enough cost savings for the critics of SLS, including NASA’s OIG, to consider the Artemis program sustainable.
As for SLS, Nelson also told reporters December 11, just after the conclusion of the Artemis I mission, that he had every reason to expect that lawmakers would continue to fund the rocket and NASA’s broader moon program.
“I’m not worried about the support from the Congress,” Nelson said.
And Bridenstine, Nelson’s predecessor who has been publicly critical SLS, said that he ultimately stands by SLS and points out that, controversies aside, it does have rare bipartisan support from its bankrollers.
“We are in a spot now where this is going to be successful,” Bridenstine said last month, recalling when he first realized the Artemis program had support from the right and left. “All of America is going to be proud of this program. And yes, there are going to be differences. People are gonna say well, you should go all commercial and drop SLS…but at the end of the day, what we have to do is we have to bring together all of the things that are the best programs that we can get for America and use them to go to the moon.”
A federal judge has ordered Boeing to appear in federal court in Texas next week for an arraignment on a fraud charge involving the certification of the 737 MAX.
Boeing and the US government in 2021 entered into a deferred prosecution agreement in this case without the participation of family members of the 737 MAX crash victims, who then argued to the court that they should have been allowed to participate in the case under a federal crime victim law. In October, the judge sided with them.
In Thursday’s ruling, Judge Reed O’Connor said Boeing must appear for an arraignment and that the family members or their attorneys may speak at the proceeding.
This legal process is separate from the civil action the victims’ family members filed against Boeing.
The Clifford Law Office, representing the victims’ family members in the civil suit, said in a statement that it is “rare in US aviation law history that a corporation is arraigned on criminal charges regarding the deaths of plane crash victims.”
In September, Boeing and its former CEO Dennis Muilenburg agreed to pay hefty fines to settle charges from the Securities and Exchange Commission that they misled the public about the safety of the 737 Max following two fatal crashes in 2018 and 2019.
United Airlines placed a massive order for at least 200 Boeing planes on Tuesday, split between two models dogged by recent problems: the 737 Max and the 787 Dreamliner.
It’s a crucial vote of confidence for Boeing, which took tens of billions of dollars in financial losses due to the problems with the two planes. The Federal Aviation Administration grounded the 737 Max for 20 months starting in March 2019, halting deliveries of the jets, after two fatal crashes that killed 346 people. The 787 was not grounded but the FAA halted deliveries for roughly a year due to quality control issues.
Even beyond those problems, Boeing has been losing the competition with European rival Airbus on new orders, especially for single-aisle jets like the 737 Max. It has done better in competition for widebody plane orders, but has faced problems there as well, with delays for a new model of the 777, the 777X, and the halt in 787 deliveries.
Later Tuesday Boeing reported that it had received orders for a total of 571 commercial planes through November of this year, net cancellations. So United’s order for 200 jets by itself represented 35% of the orders the aircraft maker had already reported for the year. But even adding those 200 jets doesn’t bring Boeing’s total near to the 825 plane orders that Airbus has booked, net its own cancellations.
While neither United
(UAL) nor Boeing
(BA) would reveal pricing details, the list price of the jets total more than $37 billion. Even with the deep discounts typical of such purchases, the order will likely amount to tens of billions of dollars in sales Boeing
(BA) desperately needs.
United said the firm orders for 100 twin-aisle 787 Dreamliners, along with an option to buy 100 more, will represent the largest widebody jet order on record by any US carrier.
“The Boeing team is honored by United’s trust in our family of airplanes to connect people and transport cargo around the world for decades to come,” said Stan Deal, CEO of Boeing’s commercial aircraft division.
Shares of Boeing rose 3% in premarket trading, following the announcement.
The 787 is a plane usedprimarilyon long-range overseas routes. The model’s purchase represents United’s belief that there is pent-up demand for international travel, which has not bounced back as quickly as US domestic passenger demand over the last year. Some countries — notably China — still have strict restrictions on flying into the country, and some passengers are concerned about foreign travel.
But United will take delivery of the planes over the course of the next 10 years, during which time any restrictions and concerns may become distant memories. And the first 100 Dreamliners it receives will replace retiring older 757, 767 and 777 jets already in United’s fleet. Some of those older planes date back at least 30 years.
United’s options for 100 additional Dreamliners represents the company’s plans to expand its fleet and its reach into international markets.
The significant order makes United the “flag carrier of the United States and the leading airline of around the globe,” United CEO Scott Kirby said Tuesday in an interview with CNN’s Poppy Harlow on CNN This Morning.
“This is just the next step in that path to replace some of our older 767s that are at the end of their life, but also to create growth opportunities for years to come in the international network for years to come,” Kirby said.
He also didn’t express any hesitation about ordering two Boeing planes that had trouble in the past, saying a “few tough years made [Boeing] stronger” and noting that United has always had a “great partnership” with the aerospace company.
The order, while an important lift for Boeing, isn’t a total surprise.
Airlines have a financial interest in sticking with the same model plane once they commit to it. The companies are able to save on pilot training and spare parts costs by populating their fleets with the same models.
Unlike a driver who can seamlessly move between car makers, commercial pilots are limited to flying only the model on which they are certified. While United has some orders with Airbus
(EADSF), nearly 80% of its existing fleet is composed of Boeing jets.
“We have a large installed base of 787s,” said Kirby when asked on a press call about potentially increasing purchases of a competing Airbus model. “The economics of bringing in another fleet type doesn’t make sense.”
Boeing started taking orders for the Dreamliner in 2004, and United was one of its earliest US customers. It is made of a lighter-weight composite material than the aluminum used to build most commercial jets, giving it much better fuel economy and thus operational savings compared to the older planes it will replace in the United fleet. United has yet to decide how many of each of the three different models of the Dreamliner it will take.
The 100 737 Max jets United is buying includes 44 planes for which it already had an option to purchase, and 56 new orders. In June 2021, it announced the purchase of 200 of the 737 Max jets, along with 70 competing planes from Airbus, in the largest aircraft order that United has ever placed.
–CNN’s Jordan Valinsky contributed to this report.
