Can Boeing recover from its Starliner spacecraft failure?

SpaceX has sent its Crew Dragon spacecraft on a rescue mission to bring two astronauts home.

NASA astronauts Butch Wilmore and Suni Williams travelled to the International Space Station (ISS) aboard the Boeing Starliner spacecraft in June.

But several engines malfunctioned once Starliner was in space. Scientists found the spacecraft was leaking helium, which is essential for the engines to function.

That left the NASA astronauts stranded aboard the space station while engineers spent weeks analysing and discussing the problem.

Now NASA officials have decided that Wilmore and Williams will remain in space until February 2025.

They will then return to Earth on Crew Dragon due to safety concerns surrounding Starliner, which was on its first mission with human crew members.

For Boeing, this embarrassing episode is the latest in a long series of problems.

This includes fatal crashes involving its 737 Max aircraft in 2018 and 2019, as well as a door that blew out mid-flight on a 737 Max 9 plane in January.

What Boeing and SpaceX tell us about the aerospace industry

Boeing’s Starliner craft has been beset with challenges since 2014.

NASA awarded both Boeing and SpaceX contracts to develop spacecraft that could transport astronauts and supplies to and from the ISS as part of its Commercial Crew Program (CCP).

Boeing received $4.2 billion (£3 billion) to develop the Starliner craft. Meanwhile, SpaceX received $2.6 billion (£1.9 billion) to develop the Crew Dragon.

Despite the lower contract value, SpaceX’s Crew Dragon has performed much better than Starliner. It successfully made its first crewed flight in 2020 and has launched regularly to the ISS ever since.

Starliner, meanwhile, has still not had a fully successful crewed flight.

This shows how much the landscape has shifted in the space sector. SpaceX was seen as something of an upstart at the time the contract was awarded.

It’s also a vote in favour of the iterative, agile processes that SpaceX adopts, versus the more traditional, linear development processes at Boeing.

The flaws in Boeing's strategy

Boeing’s reputation for safety and reliability took a massive hit with the two fatal crashes of its 737 Max aircraft.

According to a US Congressional committee report from 2020, the accidents happened against a background of financial pressure to compete with the relatively new A320neo family of aircraft manufactured by Airbus.

This pressure “resulted in extensive efforts to cut costs” and maintain the 737 Max programme schedule, the report said.

The committee identified several instances where “the desire to meet these goals and expectations jeopardised the safety of the flying public”.

Nevertheless, Boeing still managed to spend several billion dollars buying back shares, which can boost a company’s share price, among other things.

Boeing engineers were concerned about pressures within the company and their effects on safety.

These worries extended to the development of the Maneuvering Characteristics Augmentation System (MCAS), an onboard system intended to prevent stalling by adjusting the aircraft’s angle automatically.

However, the system was initially omitted from aircraft documentation. Pilots who were not familiar with the system didn’t know how to override it, leading to the fatal accidents.

In response to the Congressional report, a Boeing spokesperson said in a statement: “We have learned many hard lessons as a company from the accidents…as this report recognises, we have made fundamental changes to our company as a result, and continue to look for ways to improve.”

Faced with a public outcry after the accidents, Boeing made adjustments to its safety management systems and supply chain quality controls.

It also added safety goals as a feature of its employee compensation processes and is generally trying to shift its culture to emphasise safety. There is also more oversight by the Federal Aviation Administration.

The Boeing Starliner: what next?

The partial failure of Starliner’s mission doesn’t help Boeing’s effort to bounce back from its problems.

However, the company’s reputation has not been irreparably damaged.

Boeing can recover and is taking the right initiatives to re-emphasise a safety culture – something that’s crucial to its business going forward. But recovering trust while upholding financial performance can take years.

Boeing has lost $32 billion (£24 billion) since 2019. While losses narrowed in 2023, figures for the last two quarters have not been encouraging with respect to returning to profit. Boeing has a strong order book, but the company needs to find ways to balance efficiency and profitability without compromising safety.

For now, the future of NASA’s CCP, to transport astronauts to and from the space station, is secure. The US space agency can lean more on SpaceX, as it is doing to return the stranded astronauts.

Other companies such as Sierra Space are also developing spacecraft that could, in future, undertake the safe transport of humans to and from space.

It’s quite possible that NASA could eventually partner with these companies for its future needs.

The US space agency prefers to have more than one supplier for such crucial services, so it has flexibility when needed. It’s also preferable in case something goes wrong with one of the vehicles, something known as having “redundancy”.

The ISS is expected to be decommissioned in 2030 when it will reach the limits of its useful life.

The future for NASA and Boeing

NASA is likely to support Boeing’s continued involvement with the CCP given the sunk costs of the contract and the agency’s need to have more than one supplier.

Yet, even after the ISS is commanded to burn up over the Pacific Ocean, there will probably be commercially owned space stations that require vehicles to transport astronauts.

However, both the Boeing Starliner capsule and SpaceX Crew Dragon spacecraft spent more than a decade in development. So while other companies are waiting in the wings, their vehicles are not going to materialise immediately.

NASA is also building a space station in orbit around the Moon, called Gateway. This is part of NASA’s Artemis programme. The space agency’s Orion spacecraft will fulfil the crew transport role at first, but there could be a place for commercial providers further down the road.

The Artemis programme has the objective of returning humans to the Moon this decade and Gateway will be central to lunar operations. NASA could also launch missions to other destinations in deep space from this lunar space station.

Boeing may or may not choose to be a part of this bold new era in spaceflight and space transportation, but it will need to fully implement significant changes to rebuild trust and recover from a challenging few years.

This Core Insights article is adapted from a piece originally published by The Conversation.

Further reading:

How NASA fits into the new space race

How have open innovation and 'pirates' transformed NASA?

Increase the odds of success in digital transformation

How to build a resilient organisation

Loizos Heracleous is Professor of Strategy and teaches Strategy and Practice on the Full-Time MBA, Executive MBA, and Global Online MBA.

Learn more about strategy on the four-day Executive Education course Creating Strategic Advantage at WBS London at The Shard.

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