The McDonnell Douglas MD-95 became the Boeing 717 when the two companies merged in 1997. (Javier Bravo Muñoz via Wikimedia Commons)

The McDonnell Douglas MD-95 became the Boeing 717 when the two companies merged in 1997. (Javier Bravo Muñoz via Wikimedia Commons)

Mergers and buys expanded Boeing’s business beyond planes

The Boeing Co. is turning 100 on July 15. Throughout the year, The Daily Herald is covering the people, airplanes and moments that define The Boeing Century. More about this series

Boeing hasn’t simply outlasted many of its competitors, it has consumed some, including several giants of aerospace: North American Aviation, Piasecki Helicopter and, most significantly, McDonnell Douglas.

Boeing began with an acquisition. Its first production plant, including the Red Barn, was a converted shipyard purchased by Bill Boeing in 1910.

The company has spread across the globe and expanded its business far beyond making airplanes, in large part through mergers and acquisitions. That is how Boeing came to Wichita, Kansas (Stearman Aircraft, 1929); Philadelphia (Vertol Aircraft Corp., 1960); Seal Beach, California (Rockwell International — successor to North American Aviation, 1996); St. Louis (McDonnell Douglas, 1997); and other sites.

In recent decades, Boeing has expanded the services it offers by buying other companies, such as Jeppesen in 2000. The Denver-based company provides information management services and products for aviation and maritime customers.

The McDonnell Douglas deal made Boeing the biggest aerospace company in the world. McDonnell Douglas was a huge defense and space contractor, while Boeing dominated commercial aviation.

A common joke among Boeing workers is that McDonnell Douglas bought Boeing with Boeing’s money. Critics of the deal derisively dubbed the result “McBoeing.”

Many longtime Boeing workers and some industry watchers blame the deal for many of the problems the company has experienced since, such as 787 production issues and alienation of its workforce. Boeing’s string of successes in the Jet Age was replaced with McDonnell Douglas’ mixed record, said Richard Aboulafia, an industry analyst with Teal Group in Washington, D.C.

Still, the merger went better than the McDonnell and Douglas shotgun wedding in 1967. McDonnell, a leading fighter-jet manufacturer at the time, bailed out Douglas, which was in a financial crisis despite making popular passenger jets. The merger seemed to drive Douglas out of the commercial market more quickly.

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