The U.S. is entrusting its most expensive jet-fighter programme in history to a company that hasn’t successfully launched a commercial or military aircraft in a decade.
Boeing has been chosen by the Pentagon to build the US Air Force’s next-generation manned jet fighter, beating out Lockheed Martin in a move that surprised Wall Street and left Lockheed disappointed.
The Pentagon’s decision is crucial, as Boeing is trying to recover from a series of safety problems with its 737 MAX jet, a crippling strike and six straight annual losses.
The deal, worth over $50 billion, is structured to guarantee a profit through the development stage of the project. Boeing’s defence business represents around one-third of the company’s revenue, but has lost billions of dollars over the past few years, while Boeing says it has been locked into money-losing Pentagon contracts.
The new manned fighter, dubbed the F-47, is designed to fight with semiautonomous drones and will have new stealth and long-range strike capabilities. It is the type of sophisticated air-to-air warplane the Air Force says is vital to deterring China’s military in the decades ahead.
The Boeing jet fighters currently in flight were developed and launched before the company’s 1997 merger with McDonnell Douglas. Boeing has never before built a stealth aircraft.
Boeing spent $2 billion to expand its St. Louis complex, where the F-47 is expected to be built. It has been flying an experimental version of the jet fighter for years.