Boeing has billions in government contracts, supplies jets for world's wars and has iron grip on global travel - but with mounting safety concerns and a whistleblower 'suicide', is the Goliath company 'too big to fail'?

Boeing is battling a seemingly endless flurry of scandals.

Ever since two of its 737 MAX jets were involved in crashes which killed 346 people in 2018 and 2019, the company has been beset by a constant slew of incidents from mid-air malfunctions to alleged safety failures.

And the crisis reached a new low this week after the apparent suicide of a whistleblower who repeatedly sounded the alarm about Boeing's alleged shortcomings.

John Barnett, a former quality manager whose crucial role involved checking the safety of aircraft before they leave factories, had repeatedly raised the alarm about alleged safety failures by Boeing. 

The issues have prompted urgent questions about the company's future. They also pose another conundrum: Is Boeing 'too big to fail'?

Boeing's seemingly endless list of scandals has led some to ask whether it is 'too big to fail'

Headquartered in Arlington, Virginia, it employees around 170,000 people around the world – including about 136,000 in the United States. Pictured: Boeing's Everett, Washington factor

The term, typically used to describe banks, is reserved for a handful of global organizations whose failure would trigger shockwaves throughout business or society as a whole.

The crisis at Boeing deepened this week after a worker-turned-whistleblower, John Barnett, shot himself after testifying against the firm

In Boeing's case, it commands such a large share of commercial aviation, along with billions of dollars in military contracts, that many analysts say its collapse would trigger a crisis in the industry - and even threaten America's national security.

But following a series of safety scandals which have spooked regulators, investors and the public, some of those analysts say Boeing's 'too big to fail' status faces its biggest test to date.

The aerospace behemoth is in an unprecedented position: its stock price - and its reputation - are plummeting.

$60 BILLION BEHEMOTH

With annual revenues of $66.61 billion in 2022, Boeing is one of the largest companies in America.

Headquartered in Arlington, Virginia, it employees around 170,000 people around the world – including about 136,000 in the United States. 

There are currently more than 10,000 Boeing commercial aircraft in service, according to the company. Around two thirds of those are the 737 model, making it one of the most popular commercial aircrafts in history.

A photo shows the wreckage of a crashed Ethiopia Airlines 737 MAX 8 following an incident in March 2019 which killed 157 people

The company's revenue makes it the second largest aerospace and defense manufacturer in the world based on revenue, which was $66.61 billion in 2022. That is only around $500 million less than the number one company, Raytheon Technologies.

But despite its financial record, the recent scandals have reportedly cost it billions in revenues.

Boeing's stock price has also tumbled in the wake of its scandals this year. The stock is down by 27 percent since the beginning of January, equivalent to about $40 billion.

The firm's position at the helm of a global industry means its failure would send shockwaves throughout its supply chains and trigger other knock on impacts across the US economy.

NATIONAL SECURITY LYNCHPIN

Boeing is one of the largest recipients of defense contracts from the US government, official figures reveal – and it produces some of the military's most important equipment.

The company was awarded contracts worth $14.2 billion in 2022, placing it fifth in the table of top recipients from the Defense Department.

Recent contracts include a $2.3 billion deal to supply 15 KC-46A refueling tankers. The aircraft is a variant of the Boeing 767 and is used to refuel smaller aircraft, including fighter jets, during flight.

That deal, announced by the Pentagon in November 2023, meant Boeing had been recruited to provide a total of 153 KC-46A aircraft worth tens of billions of dollars to the US and its allies.

Boeing produces the F-15EX Eagle II fighter jet which is used by the US Air Force. The company was awarded contracts totaling $14.2 billion by the Department of Defense in 2022

Earlier this month, the Department of Defense revealed Boeing had been awarded another contract worth nearly $440 million to built a military communications satellite for the US Space Force.

Even before Boeing's latest crises – including the incident involving a door blowout on an Alaska Airlines flight – analysts were opining about the 'national security implications' of the company's recent troubles.

As Boeing faces financial issues and problems with its commercial aircraft, questions have been raised about its ability to deliver on military contracts. That could leave the military forced to rely on outdated hardware as it waits for delivery of new tools.

The firm's defense arm also reported losses totaling $1.7 billion last year following $4.4 billion in losses in 2022.

That is why the ongoing crisis will also draw a high amount of scrutiny from the US government, which may feel inclined to step in to prevent the troubled airline from declining further.

COMMERCIAL CRISIS

Boeing is responsible for nearly half of the global commercial aircraft market

The company's market share was 42 percent, according to figures published in January, with the company lagging only behind its European competitor Airbus.

The figures revealed Boeing had also recorded a 70 percent rise in net orders last year as the broader industry recovered from the pandemic.

An aerial photo shows Boeing 737 MAX airplanes parked on the tarmac at the Boeing Factory in Renton, Washington

But the recent scandals have reportedly cost the firm billions in revenues – as well as causing significant harm to its reputation.

In a sign of the company's impact on the broader industry, Southwest Airlines said today that it would reevaluate its financial forecasts for the year following delays by Boeing in delivering aircraft.

Southwest also said its operating capacity for 2024 was 'in flux' due to Boeing's alleged shortcomings. Southwest CEO Bob Jordan said: 'We all need Boeing to be better.'

Boeing announced the departure of its 737 MAX program in February just weeks after the door blowout on the Alaska Airlines flight. That issue led to the Federal Aviation Authority to temporarily ground all 737 MAX 9 airplanes.

The 737 MAX 8 was the aircraft in two separate crashes in 2018 and 2019 which killed a total of 346 people.