Air Force One deal has liftoff
Boeing recently signed a contract with President Trump to test and modify two new Air Force One jets – the deal is valued at $3.9 billion.
The Boeing 747/748’s will be finished by 2024 according to sources, which would be Trump’s last year in office if he wins reelection. Although a White House spokesman claims the president’s negotiated deal will save taxpayers over $1 billion. However, other estimates claim taxpayers will only save a few hundred million dollars.
The negotiation process all started in January 2017 when President Trump tweeted, “Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!” After this, Boeing reached out to Trump to bring the price down lower.
In 2015, the Air Force made Boeing the sole creator of the Air Force One. Although other companies can contribute parts and consulting advice, Boeing will design and assemble the plane. Because of this, competition was eliminated and Boeing has a lot more freedom in how it prices the jet.
Further, Air Force One is bound to be expensive, as the modifications are not small for the president’s jumbo jet. Air Force One includes dual power units, an elevator, lodging for family and staff, and self-defense functions. Although Boeing technically only modifies their 747 jet, they essentially have to create an entirely new jet when building Air Force One.
Since this news came out, Boeing’s stock (BA) has risen 1.4%. The aerospace company has one of the most valuable stocks in the market, so this is an impressive jump.
Featured image via US Air Force