Seven big moments that shaped the future of Boeing

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

Bill Boeing didn’t know much about flying when he went into business making airplanes. He had no formal training in the science of flight and had learned to fly less than a year earlier when he started what would become the Boeing Co. on July 15, 1916.

The company only survived its first decade due to cash infusions from Bill Boeing, who’d made a fortune in the timber business. The Boeing Co. nearly folded several times in the following decades. That was normal for the industry, whose rocky ups and downs have wrecked dozens of firms.

The Boeing Co., though, survived and today is the world’s biggest aerospace corporation. Here are seven moments that punctuate its story so far and shape its future.

1.$6,000 for UW

Bill Boeing understood top-notch engineering would be critical to his company’s success. The country’s few aeronautical engineering programs were back East, though. So, he jump-started one at the University of Washington in Seattle.

In 1917, he gave $6,000 to UW to build a wind tunnel on the condition that the university’s engineering department offer aeronautics courses. By 1929, UW had an aeronautics department.

Boeing’s initial $6,000 gift has grown to more than $80 million in contributions to UW. And the school has provided thousands of engineers to Boeing. None has played a bigger role at the company than two of the first UW alums he hired in 1917 — Claire Egtvedt and his classmate, Phil Johnson. Both would lead the Boeing Co. and help steer it toward Jet Age dominance.

2.Boeing walks away

By 1934, Bill Boeing had created an aviation industry empire called United Aircraft and Transport Corp., or UATC. It was a holding company that owned several key suppliers, airplane makers and commercial airlines. It was one of three conglomerates that dominated the industry and had a virtual lock over lucrative federal airmail contracts.

The holding companies made millions while the Great Depression gripped the nation, drawing the suspicion of many New Deal Democrats.

Critics accused Boeing and other airmail carriers of colluding to collect huge profits from the contracts and to elbow out smaller competitors. A Senate investigation grilled industry leaders, including Bill Boeing.

It was a matter of “big business in a very anti-business era,” said Paul Spitzer, an aviation historian and former Boeing archivist who lives in Seattle.

The worst allegations were never proved. Before the Air Mail Scandal petered out, Congress passed a law saying a company couldn’t both make airplanes and run airlines. That forced UATC to split into three companies, known today as Boeing, United Airlines and United Technologies.

Bill Boeing was disgusted by the experience. He sold his shares in his company and walked away from the aviation industry.

3. Betting on big

Boeing’s departure left Egtvedt in charge. Despite the company’s past success making small planes, the talented engineer staked a future on making bigger and more complex aircraft. That directly led to several groundbreaking airplanes: the Clipper, the Stratoliner, the B-17 Flying Fortress and the B-29 Superfortress.

While the Stratoliner and the Clipper were commercial flops, the Flying Fortress and Superfortress proved vital in World War II.

Demand for warplanes soared as war approached. Boeing built plants and added thousands of workers to keep pace. In 1939, Egtvedt passed the company presidency to Phil Johnson. The talented leader and manager shepherded Boeing through the dizzying growth.

“Johnson could walk out into the factory and know whether they were doing their job right or whether they were slacking,” Spitzer said.

4.Perfecting the jetliner

After the war, it was clear the future would travel on jets. But developing one of the first jetliners could ruin a company that got it wrong.

Boeing President Bill Allen, who succeeded Johnson, made a move in the early 1950s with the 367-80, better known as the Dash 80. Boeing spent nearly all the money it had made since the war ended to develop the jet prototype. If it had failed, the cost could have swamped the company.

The Dash 80 bred the KC-135 military tanker and the 707, and secured Boeing’s spot as the world’s dominant jet maker.

5. A plane for every need

Boeing expanded at breakneck speed in the 1960s as it developed a suite of jetliners to meet the needs of airlines.

It started with the 727, designed for smaller airports and shorter runways. Early sales lagged, though. So, Boeing sent a 727 on a 76,000-mile tour of 26 countries. It worked. Boeing eventually produced 1,832 727s, a record later broken by the even smaller 737. The Baby Boeing, as the 737 was dubbed, first flew in 1967. Boeing’s behemoth 747 followed two years later in 1969.

Having a plane for customers’ nearly every need helped Boeing dominate the commercial jetliner market for decades to follow. It wasn’t until the late 1980s when a competitor, Airbus, finally copied the strategy. Today, that approach still heavily influences airplane development at both companies.

6. Surviving the Boeing bust

The Boeing boom years slammed into the Boeing Bust in the late 1960s. A global recession, soaring oil prices and new environmental regulations contributed to airlines cancelling jet orders. Boeing slashed its workforce from 142,400 employees in 1968 to 56,300 in 1971, according to annual reports.

It happened so fast, many production managers “didn’t even know how many people they had working for them,” Spitzer said.

As the global economy recovered a few years later, airlines bought new planes in batches. Many of the laid-off workers came back to the Boeing family.

7. Going global

Boeing’s purchase of McDonnell Douglas ensured its status as the world’s biggest aerospace company. It also sped up and magnified a seismic shift in Boeing’s corporate culture. It shed a homegrown identity for a more global, corporate look.

Harry Stonecipher, the Boeing CEO and president who came from McDonnell Douglas, famously told workers to quit behaving like a family and start acting like a team. Workers who didn’t perform would be cut from the team.

“When people say I changed the culture of Boeing, that was the intent, so that it’s run like a business rather than a great engineering firm,” Stonecipher told the Chicago Tribune in 2004. “It is a great engineering firm, but people invest in a company because they want to make money.”

Boeing has an order backlog worth nearly $500 billion at list prices. And it is developing new airplanes — the 737 MAX, 777X and the KC-46A tanker. It continues to develop new technologies and expand human knowledge.

Yet, those successes are marred for many here by memories of company leaders moving Boeing headquarters to Chicago, putting a second 787 assembly line in South Carolina and hard bargaining with unions and suppliers.