Boeing is looking for an escape hatch from the space business
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Boeing (BA+0.13%), the aerospace company with a storied past of working with NASA, is exploring a sale of its space-focused programs, including its Starliner space vehicle and International Space Station (ISS) operations.
Sources familiar with the matter told the Wall Street Journal that the move is part of the company’s new CEO Kelly Ortberg’s strategy to simplify Boeing’s portfolio amid ongoing financial challenges.
Boeing’s stock briefly rose 1% today. The company did not immediately respond to a request for comment from Quartz.
Ortberg, who became CEO in August, has prioritized restructuring and asset sales to offset Boeing’s financial losses.
The company’s largest union recently extended a strike, halting most airplane production. Members of the International Association of Machinists and Aerospace Workers (IAM), the union representing the striking employees, voted down the company’s latest offer this Wednesday. Two key sticking points have been the size of the raise — the IAM has been seeking a 40% wage increase — and the restoration of Boeing’s pension, which was cut as a benefit for new employees a decade ago.
At the same time, the company’s defense and space division have been hindered by delays, resulting in a $3.1 billion loss over the first three quarters of 2024.
“We’re better off doing less and doing it better than doing more and not doing it well,” Ortberg told investors on a call this week.
Boeing’s NASA partnership dates back decades, from supporting Apollo missions to being the primary contractor for the ISS. However, recently SpaceX has largely taken over as NASA’s primary partner. NASA opted to transport astronauts on SpaceX’s Crew Dragon after Starliner’s debut human spaceflight encountered issues.
Boeing is expected keep its role of overseeing NASA’s Space Launch System (SLS), a rocket the administration plans to use for future lunar-exploration missions. The SLS completed its first mission in 2022, despite facing quality control challenges.
Potential buyers for Boeing’s NASA contracts include the Jeff Bezos-owned Blue Origin. Boeing had previous discussions with Blue Origin about taking over some of its NASA programs.
