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Comment by arcticbull | Hacker News Reader

Lost, or invested? One imagines if they outright lost it and saw no opportunity to recoup (i.e. no longer an investment) they'd just end the program.

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The contract doesn't permit Boeing to cancel. NASA can.

How does that work? Does Boeing pay a penalty if they don’t make progress?

US law allows companies to split off a subsidiary with all the liabilities and the main company to continue to function with all the assets just like before https://www.ltltalccommittee.org/

Boeing wouldn't need to pay anything.

They would never get another space contract again if they did that, but they can see this will be a larger market in 30 years, so they'll lick their wounds and continue on commercial space projects.

> They would never get another space contract again if they did that

People say that, but I don't think it's true. Boeing pulled out of the Phantom Express project seemingly unscathed.

https://www.space.com/boeing-withdraws-darpa-military-space-...

Depends on how good their lobbyists are.

They're also vastly different projects. Phantom Express was very much experimental; Starliner wasn't supposed to be. Part of the selling point for Boeing was "this is mundane stuff we already know how to do".

You cite LTL / J&J like they got away with it. It's currently being litigated in multiple courts, it could go either way: https://money.usnews.com/investing/news/articles/2023-06-27/...

No, that is not how bankruptcy court works. The subsidiary needs to have enough assets to pay the creditors, up to the entire value of the company.

For that investment to work, they need to bring in some revenue as well. The ISS is scheduled to retire by 2030. Let's assume this capsule goes operational in 2025 and flies twice a year, that's 10 flights to recoup well, well over a billion by then. Let's say a 100 million per flight. Not sure what the contract is exactly, but it's not looking great.

Pretty sure SpaceX is cheaper, so NASA will be the only customer.

NASA plans to have other places to send astronauts by then. The ISS will almost certainly have its life extended again before that though.

NASA has already awarded all the ISS crew flights up through it's scheduled retirement in 2030. Boeing is contracted for 6 flights, and SpaceX for 14 (including the 6 it has already flown). NASA hasn't published the milestone payment schedules, but the total contract was for $4.2 billion, so Boeing would have needed to budget a 26% profit margin on the whole endeavor to break even at this point. That wouldn't surprise me, but they are probably quickly reaching the point where they will actually be losing money.

They could end the program but violating their contract probably costs them more than just finishing the work at a loss.

they would have cancelled a long time ago if they could

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