To keep Starliner flying, Boeing must make some hard choices

In September 2009, Boeing announced that it would participate in NASA's new "commercial crew" program. The aerospace industry leader vowed to bring its long experience in supporting the space agency and leverage its human spaceflight experience to make the program successful.

"Boeing has a lot to offer NASA in this new field of commercial crew transportation services," Keith Reiley, then the Boeing program manager for the project, said at the time. "To show our commitment, we are willing to make a substantial investment in research and development."

This was a consequential moment for the new program, which lacked widespread support from Congress. The commercial initiative had only been created because the Obama administration tucked $50 million into its American Recovery and Reinvestment Act of 2009 for a new program start.

In recent years, both of the two top leaders of NASA in 2009—former Administrator Charlie Bolden and Deputy Administrator Lori Garver—have pointed to Boeing's entry into the commercial crew program as essential to its long-term success.

"Boeing entering the commercial crew program meant that you got a lot more support from Congress because they tend to have a very robust lobbying program," Garver said last year. "I was very happy when the traditional, big aerospace company Boeing bid. Because I think that was a tough call. And I think if they look back on it, they wouldn't do it again."

Lack of investment

Thursday's disquieting announcement from Boeing that it found two serious safety issues with its Starliner spacecraft—insufficiently strong parachute straps and hundreds of feet of flammable tape inside the vehicle—within weeks of its first crewed flight raises questions anew about the viability of the program.

To date, Boeing has taken nearly $900 million in charges against its earnings for setbacks in Starliner's development, and this latest delay, which is likely to take at least six months to resolve, if not much longer, will undoubtedly push those charges higher. It is difficult to see Boeing ever making money on Starliner after nearly 14 years of involvement in commercial crew.

Although Reiley said in 2009 the company was making a "substantial investment" in the development of Starliner, then known as CST-100, multiple sources told Ars that was not the case. Instead, Boeing for a long time "nickel-and-dimed" the time engineers spent working on Starliner. This was partly due to congressional underfunding of the commercial crew program but also because Boeing did not want to put skin in the game.

This has been a poor decision in retrospect because, due to the fixed-price nature of its contract with NASA, Boeing is largely responsible for cost overruns and losses due to ongoing delays. The company now essentially has three options, none of which is particularly appealing.