One early winner from President Donald Trump’s trip to the Middle East is undoubtedly Boeing, and new, record-breaking deals, could give it the runway to soar after a bad year. Up to 268 new Boeing aircraft were ordered by Abu Dhabi’s Etihad Airways, Qatar Airways and Saudi lessor AviLease. In a statement, Boeing said that these orders will support nearly 400,000 jobs in the U.S. Boeing CEO Kelly Ortberg traveled with Trump, and was on hand to personally receive the orders.
It could mark a turnaround for the aircraft manufacturer, which had a devastating 2024. A door plug on a 737 MAX 9 jet blew out mid-flight, grounding many airplanes; a two-month strike for more than 33,000 machinists; and planned prosecution for fraud charges in connection with two plane crashes in 2018 and 2019 that left 346 people dead. Boeing’s stock saw an uptick last week as the deals were announced, and its current price is up nearly 4% compared to a week ago.
However, the success of the deals is contingent on Boeing actually being able to produce the planes. Last year’s safety issues and strike both increased its backlog and forced production slowdowns. The company is ramping its deliveries back up, but according to Boeing’s most recent earnings report, it has a backlog of more than 5,600 commercial airplanes. Aviation expert Mike Boyd told Bloomberg that these deals mean Boeing must deliver, and needs to clean up the problems that shaped its last year—as well as previous management issues in which analysts say the company became more focused on short-term profits and concentrated less on safety.
Boeing could be seeing another big deal with the federal government as well. The Wall Street Journal reports the federal government is planning to grant Boeing a nonprosecution agreement in the fraud case about the deadly plane crashes, which would allow the company to avoid a felony conviction. Under this agreement, which is not final, Boeing could pay $444 million to victims’ families, as well as an additional $243 million fine, and be forced to hire an independent compliance consultant reporting to the Justice Department. An attorney for the victims’ families told the Journal the agreement is a terrible deal that will protect Boeing from accountability. However, the legal deal would give Boeing as a company more ability to fulfill the Middle Eastern deals—and shows how the Trump Administration can help out big business, both on the deal and regulatory side.
The economic picture for all companies is shifting quickly, and it is difficult to plan for the future. I talked to Tom Strohl, president of business transformation firm Oliver Wight Americas, about how strategies such as integrated business planning can make it at least more manageable. An excerpt from our conversation is later in this newsletter.
TOMORROW’S TRENDS
How To Plan For The Future When The Economic Picture Is Changing Quickly
In a situation like this, is it possible to plan for the long term? How would you recommend doing it?
How does a business get this single version of truth?
Strohl: That’s what integrated business planning is all about. Integrated business planning is a senior management-led process that speaks to aligning the three key core business processes—which are portfolio management, demand management, supply management—but then align financials looking out into the future, minimally 24 months. Once you have that, now you can very quickly see when you’ve got a change—such as tariffs, regulatory or taxation changes, geopolitical issues, or even natural disasters. Now you have the ability to say, ‘If that happens, then this is what we need to do.’Ideally, companies that had a robust integrated business planning process would’ve already been using that even before November. But certainly, the new administration was telegraphing what they were going to be doing around tariffs, regulatory and taxation changes and all of that. Our position is, this isn’t a question of whether it’s good or bad. This is a question of it’s happening, and what are you going to do? Back in November, if they were asking the questions, right now they’d be in a much better situation.
What kind of advice would you give to business leaders that are trying to shore up their planning process and be able to get a much better handle on everything?
Strohl: First and foremost, educate yourself about what good looks like. Understand the capabilities that you have internally: the skill sets, the readiness level of your internal organization to be able to make these kinds of changes. And if you need help, get help.
If they’re wanting to change, I fully support that, but make sure you know what you’re doing. We have a phrase in our organization that says, ‘Commitment without understanding is a liability.’ And we see that a lot with clients. They’re out trying to effect change, but they don’t really understand the implications of the change, and it becomes a liability for them.