Boeing lost $660 million by agreeing to Trump's demands for new Air Force One jets
- Boeing's CEO says company "probably shouldn't have" agreed to Trump's demands for new Air Force One.
- Trump was personally involved in negotiations between Boeing and his administration over the planes.
Boeing has lost $660 million on the planes that will serve as the next Air Force One aircraft after agreeing to former President Donald Trump's proposal for the jets, the head of the Chicago-based company said Wednesday.
During Boeing's quarterly earnings call, CEO Dave Calhoun said the company should have rejected the Trump administration's proposal.
"Air Force One I'm just going to call a very unique moment, a very unique negotiation, a very unique set of risks that Boeing probably shouldn't have taken, but we are where we are, and we're going to deliver great airplanes, and we're going to recognize the costs associated with it," Calhoun said during the call.
Trump was personally involved in the negotiations between Boeing and his administration and even commented about his frustration with their price: "Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion, Cancel order!" Trump tweeted in 2016.
After protracted talks, the Trump administration and Boeing ultimately settled on a fixed-price agreement in 2018, which requires Boeing to pay for any overruns. Calhoun said the $660 million charge was due to schedule delays and higher supplier costs.
Bigger, better, and more expensive jets
After serving five presidents for nearly three decades, the Boeing 747s currently serving as Air Force One will be replaced with 747-8i aircraft.
Known as VC-25Bs, the new aircraft will be larger and more fuel efficient than the previous jets, allowing the US Air Force to save roughly $1.9 billion in operations and maintenance costs during the jets' 20- to 30-year service lives, according to Defense One.
Although Boeing is keeping the total cost of the jets under wraps, the estimated price is $5.3 billion, about one-third more than the $3.9 billion widely advertised by the Trump White House, Defense One reported. The aircraft's owners manual alone will cost $84 million.
When Air Force One was last replaced during the George H.W. Bush administration, the total cost was $660 million, or roughly $1.45 billion today, according to the LA Times.
Despite the hefty charges, the VC-25Bs are not built from scratch. To save money, Boeing sold the government two jets that were intended for a Russian airline that went bankrupt in 2015.
President Joe Biden will be the first commander-in-chief to use the new jets, with one set to enter service in 2024 and the other in 2025, Bloomberg reported.
While Trump took a keen interest in the new jets — even designing a red, white, and blue color scheme to replace the light blue and white model designed by the Kennedys — Biden has avoided them.
"I can confirm for you here: The president has not spent a moment thinking about the color scheme of Air Force One," White House Press Secretary Jen Psaki told reporters last year.