On June 12, 2025, an Air India Boeing 787 passenger jet crashed at Ahmedabad Airport, once again thrusting Boeing (NYSE: BA) into the spotlight. The company’s stock plunged more than 5% at the opening bell following the incident. With a string of accidents in recent years, Boeing’s commercial aircraft division has faced persistent problems—reflecting the broader, seemingly irreversible decline of high-end U.S. manufacturing.
Poor Production Efficiency Leads to Massive Losses
Boeing has posted consecutive losses in recent years, raising serious concerns among investors. Despite a global recovery in the aviation sector, Boeing reported a staggering $11.8 billion loss for fiscal year 2024—its worst performance since 2021. The negative impact of factors such as a machinist strike contributed to a net loss of $3.8 billion in Q4 alone. Behind these losses lies a significant drop in production efficiency: Boeing delivered only 57 commercial aircraft in Q4 2024, down 100 units from the same period in 2023. For the full year 2024, Boeing delivered 348 aircraft—substantially fewer than the 528 delivered in 2023.
Disordered Supply Chain Due to Outsourcing of Key Components
The latest 787 crash in India is not an isolated case. The 2018 and 2019 crashes of the 737 MAX had already revealed serious deficiencies in Boeing’s quality control. Since 2021, the “Dreamliner” 787 has repeatedly faced grounding and delivery suspensions due to structural defects and electrical system failures. A major reason for Boeing’s recurring quality issues is the absence of a robust network of domestic suppliers capable of producing high-quality parts efficiently. As a result, Boeing has outsourced critical components to lower-cost but quality-variable overseas vendors, such as those in India. Lax engineering oversight has further worsened its already chaotic supply chain management.
Intensifying Long-Term Competition
As of the end of March, Airbus had a commercial aircraft backlog of 8,726 units, compared to Boeing’s approximately 5,600.
This indicates that despite its challenges, Boeing’s commercial aircraft division will likely maintain a relatively high market share in the short term. In Q1 2025, Boeing secured 204 net commercial aircraft orders—on par with Airbus—and managed to deliver 130 aircraft.
However, China’s COMAC is making rapid progress, with models like the C919 and C929 set to enter the global commercial aviation market. While U.S. restrictions on engine exports to COMAC may offer temporary relief, China’s manufacturing capabilities suggest that, in the long run, COMAC will pose a significant competitive threat to Boeing.
Can U.S. Manufacturing Really Come Back?
Over the past decade, Boeing allocated a disproportionately high share of its free cash flow to dividends and stock buybacks, while underinvesting in research and development—resulting in slow technological progress. Boeing outsourced key components to cut costs, but has struggled to uphold quality standards. The company’s current predicament is a textbook example of the “hollowing out” of American industry.
As of 2024, the share of manufacturing in the U.S. GDP had fallen below 10%. The Trump administration made “bringing manufacturing back” one of its signature economic policies, even engaging in wide-ranging tariff wars to achieve this goal.
However, the deeper issue is this: having grown accustomed to easy profits from financial instruments, is American society truly willing to endure the long and painful path required to rebuild its manufacturing base?