Former US President Donald Trump’s new deal for Air Force One was a bad one for Boeing, the plane-maker’s chief executive has said.
Dave Calhoun spoke as the firm said it expected to lose $1.1bn (£875m) on the two planes for the White House.
Mr Trump had forced the company to renegotiate its contract, calling the initial deal too expensive. The new agreement made Boeing, not taxpayers, responsible for changes to costs.
“We took some risks not knowing that Covid-19 would arrive and not knowing that inflation would take hold like it has – and both of those have impacted us fairly severely,” Mr Calhoun said on a conference call with investors on Wednesday.
Technically, “Air Force One” is a call sign for any aircraft carrying the US president.
However the term is mostly used to refer to the current fleet – two highly customised Boeing 747-200B jets, which have been in service since 1990.
Before Mr Trump was elected in 2016, the government had a roughly $4bn contract with Boeing to build two or more new planes. But in 2016, shortly after Mr Trump’s victory, he tweeted that they were too expensive and called for cancelling the order.
Two years later, the two sides announced a new $3.9bn deal to convert two new 747-8 planes with a communications suite each, internal and external stairs, large galleys and other equipment and modifications to protect passengers.
At the time, Mr Trump – who prides himself on his deal-making – hailed the agreement, though critics said the savings weren’t clear.
Boeing – a major government and defence contractor – faced “a very unique negotiation, a very unique set of risks that Boeing probably shouldn’t have taken” during the Air Force One talks, Mr Calhoun said.
“But we are where we are, and we’re going to deliver great airplanes.”
The planes are designed to be an airborne White House, able to fly in worst-case security scenarios, such as nuclear war, and are modified with military avionics, advanced communications and a self-defence system.
The planes were supposed to be delivered by 2024 but are behind schedule, according to reports. Boeing disclosed it has lost $660m this quarter on the programme.