Boeing’s Post-War Commercial Aviation Activities

When World
War II ended in August 1945, the U.S. government cancelled most
orders for bomber aircraft, which had been a mainstay of the aircraft
industry. Total industry production dropped from 96,000 airplanes
in 1944 to 1,330 military aircraft in 1946. Companies like Boeing
turned to the commercial market to try to supplement whatever military
orders they could find, as well as find ways to diversify into
entirely non-aeronautical activities such as building automobiles.

The Stratocruiser,
a luxurious version of the C-97 transport plane, was Boeing’s first
commercial venture after the war. First flying in 1947, it was moderately
successful—55 were sold—but it was not quite enough to pull the
company out of its post-war slump. The company’s doldrums were further
aggravated by a strike of 14,800 union members in April 1948 over
the issue of seniority. The strike lasted into September and virtually
shut down production.

Boeing’s
first successful commercial aircraft in the post-war era was the
367-80, called the Dash 80. Its development began in 1952, and the
plane first flew in July 1954. This plane combined features of the
military B-47 and B-52 with a large cabin size. Although the Dash
80 was a gamble—Boeing sank $16 million of the company’s profits
into its development—it was a success. It became the model for both
the KC-135 Stratotanker and the Model 707-120, Boeing’s first commercial
jet airliner and a direct competitor to the Douglas
DC-8.

Pan American
Airway’s Juan Trippe
ordered the first 707s after their 1957 introduction. He ordered
20 at the same time that he ordered 25 DC-8s from Douglas. The 707
was soon flying across the Atlantic Ocean. Two 707s, designated
VC-137C, were specially adopted for use as Air Force One, and remained
in service until 1990. It also was modified for use as the E-3A
Airborne Warning and Control System (AWACS), produced until 1991.

The 727
airliner followed in 1963. This plane was designed to serve smaller
airports and could operate on shorter runways than the 707. It was
Boeing’s only tri-jet and its sales started out slowly. To help
create interest, Boeing sent the plane on a 76,000-mile (122,310-kilometer)
tour of 26 countries. The gamut worked and more than 1,800 planes
were sold, many more than the 250 Boeing had originally planned
to build.

The 737
debuted in 1967. Smaller than the 707 and 727, it faced heavy competition
from the Douglas DC-9 and the British Aircraft Corporation BAC-111.
It was quieter and vibrated less than earlier planes and could be
flown with just a two-member flight crew. On June 12, 1987, orders
for the plane surpassed the 727, making it the most ordered commercial
plane in history.

Boeing’s
most famous aircraft is undoubtedly its 747
wide-body jumbo jet. Conceived in the spring of 1965, largely at
the instigation of Pan Am’s Trippe, the first 747 rolled out on
September 30, 1968. The first flight took place on February 9, 1969,
and it entered service in January 1970. In 1990, two 747s became
the new Air Force One, replacing the 707s that had served in that
role for almost 30 years.

About
the same time that Boeing was sinking its money into the 747, it
was also attempting to develop America’s first
supersonic transport (SST). In the early 1960s, fearful about
being left behind in the SST race, the U.S. government asked its
aerospace companies to submit a design to compete with Europe’s
future Concorde. At the end of 1966, the government chose Boeing’s
design over Lockheed’s, and the company began work on a prototype.
Hard economic times and mounting environmental concerns, though,
combined to force the program’s cancellation in March 1971, after
more than $500 million of federal funds had been sunk into the program.

From 1968,
Boeing carried out a major internal restructuring. Eliminating some
divisions and creating others, its Commercial Airplane Division
remained the largest in the company. Thornton “T” Wilson
became president in 1968 and had to deal with the problems associated
with the 747. In 1969, company profits declined to only $10 million.

The 1970s
were extremely hard times for Boeing. The United States was in a
recession, and sales of commercial aircraft were slow. The 747 had
not yet established itself in the market, and the company went for
one 18-month period without a single new domestic order for any
of its airliners. In the Seattle area alone, Boeing’s workforce
plummeted from 80,400 in early 1970 to 37,200 in October 1971. All
of Seattle suffered, and a billboard on the city’s edge read: “Will
the last person leaving Seattle turn out the lights.” Wilson
remained as president until 1972, when Malcolm Stamper, who had
led the 747 program, took the post, which he held until 1985. Another
reorganization at the end of 1972 resulted in the formation for
three largely autonomous companies: Boeing Commercial Airplane,
Boeing Aerospace, and Boeing Vertol for helicopters.

The country
began to recover by 1983, and airlines once again began buying Boeing
aircraft. The environment had changed, however, during the downturn.
Fuel prices had risen and environmental concerns had come to the
forefront. Planes had to be faster, quieter, and more energy efficient.
The export market also grew, and in 1988, Boeing was ranked third
among all industrial exporters, with $17 billion in sales. Cost
control was a high priority, and Boeing cut its workforce from a
1989 peak of 165,000 to below 120,000 by 1993.

Beginning
in the early 1980s, Boeing concurrently developed the 767 and 757.
The 767 served in the medium to long-range market, carrying about
220 passengers. Like the 747, it was a wide-body plane with two
aisles but with the efficiency of the smaller 757. In December 1991,
a modified 767 was adopted to carry the AWACS (Airborne Warning
and Control System)—an airborne system of radar and electronic equipment
that allows control of the total air effort in a battle area. The
twin-engine 757, designed to replace the 727, rolled out in 1982.
It could seat about 200 passengers in its original model and up
to 290 passengers in its newer model. Orders for the two planes
were slow after their initial group of orders but increased significantly
in 1980 when Delta Air Lines ordered 60 757s.

The model
777, first flown in June 1994 and delivered in May 1995, was the
first entirely new Boeing airplane in more than a decade. It represented
a major advance in being designed almost entirely by computer. A
large twin-jet, it could hold more than 400 people, about the same
as the 747. About the same time, Boeing introduced updated 737 versions
with various passenger capacities. Total 737 orders neared 3,000
in 1996.

At the
end of 1996, Boeing surprised industry observers by announcing a
bid for acquisition of McDonnell Douglas,
one of Boeing’s main competitors. McDonnell Douglas agreed to the
merger, and a single company with more than 220,000 employees was
formed. In 2001, Boeing remains the only American provider of commercial
aircraft, competing with Europe’s Airbus Industrie for the world’s
airliner market.

—Judy
Rumerman

Mansfield,
Harold. Vision, the Story of Boeing. New York: Madison Publishing,
1986.