The Pros and Cons of Boeing

In 2002, Boeing was the gold standard in the aerospace industry:

Safety culture in systems engineering: Decades of manned spaceflight, such as the Space Shuttle and International Space Station, had built rigorous processes, quality systems, and risk management experience.
Industrial resources in the supply chain: A mature and vast supplier network, production bases, and political lobbying power.
Capital and order reserves: Stable government contracts, such as the Delta rocket, satellite launches, and strong cash flow.
Talent density: A large pool of experienced engineers and project management experts.

Until SpaceX exposed Boeing's systemic flaws.

After failing to buy rockets from Russia, Elon Musk founded SpaceX with the core logic that traditional aerospace was costly, slow to iterate, and stagnant in innovation—directly targeting Boeing.

Cost black holes and bureaucracy. Boeing's quotes were 3-5 times higher than SpaceX's, rooted in excessive subcontracting. Most rockets were outsourced, turning Boeing into a systems integrator with profits sliced away and weak control. High fixed costs supported a bloated management team, legacy facilities, and retiree benefits.

Meanwhile, SpaceX pursued vertical integration, developing its own engines, chips, and software, building rockets on an assembly line in Hawthorne, California. This is also the advantage of $Cleveland Cliffs(CLF.US).

Risk aversion and innovation inertia. Boeing's culture aimed for zero errors but led to slow decision-making, fearing disruption to its existing profit model, such as maintenance service fees.

Musk demanded engineers remove non-essential parts, while Boeing's processes added more redundant review steps.

Moreover, $Boeing(BA.US) is notorious for its technical, debt, and path dependencies; long reliant on government cost-plus contracts, it lacked iteration drive, as seen in decades of minor fixes to the Delta rocket.

SpaceX started from scratch, adopting 3D printing, composite materials, and agile software development.

Customer focus also faltered. Boeing treated NASA and others as patrons, often delaying deliveries and overspending, like the SLS rocket. SpaceX, early on, used self-funded R&D and public trial-and-error to build trust—Falcon 1 failed three times before succeeding on the fourth attempt.

Boeing's Starliner, launched in 2009, was still delayed by software and valve issues by 2024, costing over $4.4 billion. SpaceX's Dragon, launched in 2006, docked with the ISS in 2012 and achieved crewed flight in 2020 at a cost of ~$2.6 billion.

SpaceX adopted Silicon Valley-style rapid prototyping, using car seatbelts as early seats. Boeing over-relied on traditional aerospace supply chains, with layered outsourcing causing coordination issues.

Boeing saw aerospace as high-end manufacturing, prioritizing process, documentation, and compliance but easily falling into bureaucracy. SpaceX viewed it as a systems engineering blend of hardware and software, using internet thinking for rapid iteration, vertical integration, and first-principles industry restructuring.

But this is also where their differences lie.

Boeing's strengths—safety legacy and political-business relationships—became burdens in the new era. Shareholder-first culture squeezed R&D investment, with massive stock buybacks post-2010 instead of tech investment. Engineering culture gave way to finance culture, and HQ's move from Seattle disconnected it from frontline work. It couldn't afford rapid failure, as public trial-and-error would hurt stock prices and government trust.

Until Trump took office, emphasizing Boeing's role as a U.S. manufacturing leader and placing it under defense... So what happens next? 🤔