This year, a body panel blew one of its jets out of the air. Starliner space capsule stranded two astronauts in orbit. Its largest union halted aircraft production, worsening its cash flow. He’s set to plead guilty in a case linked to two fatal crashes, and his credit score is flirting with junk status.

There are many potential villains here: a culture that puts financial engineering ahead of aerospace engineering, an outsourcing strategy that shifts work to lower-cost factories or suppliers, the pursuit of production goals rather than safety goals, and employees eliminating detached leadership.

Whatever the reason, Boeing has reached a point where people are really asking: Could Boeing fail? So what would the endgame look like in such a scenario involving a national icon?

Regulators, under pressure from lawmakers, began scrutinizing Boeing more closely after the crashes sapped public confidence in the company, slowing deliveries and approval of new aircraft models.

Kelly Ortberg, who took over as CEO of Boeing just three months ago, told investors and employees last week: “Trust in our company has eroded.” Boeing declined to comment and referred to Ortberg’s comments this week.

“It will take time to return Boeing to its legacy, but with the right focus and culture, we can once again become an iconic company and aviation leader,” Ortberg said. In a memo to staff, Ortberg said the company needed to repair a malfunction. Broken culture diminishes itself and improves execution.

Ortberg decided to cut 17,000 jobs and sell up to $25 billion in stock or debt to cover cash flow. Boeing is exploring the sale of some of its space businesses. But the new CEO failed to reach an agreement with the 33,000 machinists who walked off the job six weeks ago, demanding higher wages and benefits. The strike causes Boeing to lose $1 billion a month from dwindling reserves.

The planemaker’s assembly problems in many ways date back to the 737 MAX, the latest version of the decades-old narrow-body machine.

The focus on reducing training costs coincided with the design flaws that led to the fatal crash of Lion Air Flight 610 six years ago this month. Boeing’s subsequent failure to admit its mistakes and quickly fix the plane’s safety problems set the stage for a second crash in Ethiopia just a few months later, undermining the trust the company had provided to regulators, airlines and the flying public for decades.

Following the first 737 MAX crash in Indonesia on October 29, 2018, Boeing downplayed problems with the flawed flight control system and instead pointed to missteps by the airline’s pilots and maintenance.

Then-CEO Dennis Muilenburg directed his communications team to remove any draft press release that mentioned any work to fix a new cockpit feature that sent the plane into a fatal crash, according to an agreement with securities regulators. The press release declared that the MAX was “as safe as any aircraft that has ever flown the skies.” Boeing and Muilenburg settled the case without admitting or denying guilt.

Whether Boeing’s overemphasis on financial metrics has led to cultural decay has been debated inside and outside the company. Critics attribute the beginning of the decline to the 1990s, when Boeing began adopting many of the common management practices at its supplier General Electric, including a focus on short-term profitability.

The merger of rival McDonnell Douglas in 1997 further strengthened Boeing’s pivot from an engineering-focused culture to more centralized corporate control. Its decision to move its headquarters from its Seattle manufacturing hub to Chicago in 2001 and then to Virginia in 2022 exemplified this shift.

Greater emphasis on financial metrics had some positive effects on the aerospace industry, which at the time was often not spending money on things airlines actually needed. For example, the L-1011 TriStar was loved by engineers, but it arrived late and had a very short range; this effectively forced Lockheed Martin out of the commercial aircraft business in the 1980s.

But amid a culture shift at Boeing, some engineers are afraid to raise safety issues with managers or face undue pressure, current and former employees say. Before the first MAX crash, some worried that the flight control system, known as MCAS, could lead to costly simulator training for airlines and make the plane less attractive to purchase. Boeing said it was taking steps to encourage more employees to voice their concerns.

Federal prosecutors investigated an email they claimed showed a Boeing employee was under financial pressure to deceive the Federal Aviation Administration into not requiring simulator time for pilots flying the MAX. The email showed that the employee was concerned he would be blamed for “costing Boeing tens of millions of dollars.”

Muilenburg appeared concerned that regulatory questions after the first crash could disrupt the company’s cash flow. “We need to be careful that (the FAA’s interest in pilot guidelines) does not turn into a compliance clause restricting short-term deliveries,” the CEO said in an email that emerged in shareholder lawsuits.

David Calhoun said that when he takes over as CEO in 2020, the company will focus on building trust and getting back to basics. “We’re going to do a little less vision and a little less long-range planning,” Calhoun told reporters at the time. “We will get back to restoring trust in each other, trust in our customers, and trust in our regulator; we will be transparent every step of the way.”

More and more quality and application problems have emerged in commercial aircraft, defense and space programs. Boeing executives have repeatedly emphasized that they will focus on safety, engineering and quality. The company has not been able to make an annual profit since 2018.

Alaska Airlines’ implosion in January revealed that many of Boeing’s problems remain unresolved. Government investigations have found that front-line workers still face production pressures and problem planes continue to roll down the line and out of the factory.

David Boulter, the FAA’s safety chief, said the key to fixing Boeing is to ensure all employees have the opportunity to talk about problems and be heard; This is the type of culture that has fueled safety gains at airlines.

“Obviously, that’s where we’ve seen the most success with airlines,” Boulter said on the sidelines of an industry event in Las Vegas this month. “Those with great safety cultures have great safety records.”

The plane maker lost nearly 20% of its stock market value following the Ethiopian Airlines crash in March 2019, which grounded the global 737 MAX fleet. But even that didn’t completely reverse the massive rally that took shares to a record high of $446 in the previous three months.

Inventories remained at the same level in December 2019 when the company had to temporarily halt aircraft production. But that came to an end early in the Covid-19 pandemic in 2020, when all production was halted and recertification of the MAX was further delayed.

Now investors have accepted that Boeing’s earnings will be much lower in the future. The shares are worth $155.

The ongoing strike has led all three major rating companies to warn that Boeing’s debt could be downgraded to the “speculative” category.

Wall Street analysts estimate that increasing production to more than 50 MAX and 10 Dreamliners per month would generate more than $10 billion in annual revenue, but that is proving increasingly difficult. On Wednesday, Chief Financial Officer Brian West told analysts Boeing’s operations will burn cash in 2025.

Investable companies don’t shed cash, no matter how strong the long-term business case is.

In the second half of the decade, executives will need to begin investing heavily in developing a new, innovative, narrow-body aircraft to replace the MAX. Failure to do so would likely mean giving up head-to-head competition with European rival Airbus.

It’s been more than a decade since Boeing began delivering the 787 Dreamliner, the last “clean sheet” commercial design not based on a previous model. However, excessive outsourcing has made this program fraught with problems.

To recreate a true success story, Boeing dates back to 1990, when a team led by longtime company engineer Alan Mulally, who later became CEO of Ford Motor, designed the 777 in collaboration with airline customers and pioneered new computer design tools. He needs to go back to ‘s. .

Some analysts believe the best path forward would be to follow in GE’s footsteps and break up the company to allow each division to better focus on its own strengths. Boeing’s defense, space and security arm, which accounts for 31% of total revenue, could perhaps get by without space projects comparable to Elon Musk’s SpaceX. As for the rest, advances in aerodynamics, materials science and manufacturing processes often converge between the defense and commercial sides.

The defense business also gives Boeing access to lucrative Pentagon contracts, reinforcing the impression in Washington that the company is “too big to fail.”

There is no easy way out, with $12.5 billion of the $58 billion debt maturing in 2025 and 2026. Boeing looks set to issue about $10 billion of the total $25 billion it could raise in new shares. Often stock investors fear being diluted. This time around, many are encouraging managers to maximize cash collections to gain room to maneuver.

As time is running out to get out of this slump, the interests of producers and bean counters may finally be aligned.

Write to Andrew Tangel at [email protected] and Jon Sindreu at [email protected].