Boeing reported a staggering $11.8 billion loss for 2024, marking its worst financial result since 2020 when the aviation industry was hit hard by the COVID-19 pandemic. The aerospace giant struggled with a combination of safety crises, quality control failures, and a damaging strike, which severely impacted its operations.

In the final quarter of the year, Boeing faced a $3.8 billion loss, largely driven by a seven-week strike by 33,000 workers, primarily based in the Seattle area. This strike halted production at key factories, including those responsible for the 737 Max, 777, and 767 freighter models. The strike, which began in September, reflected worker dissatisfaction over pay and retirement benefits. Although the dispute was resolved by early November, the production stoppage dealt a major blow to Boeing’s finances.

Boeing’s troubles were compounded by ongoing quality control and safety issues. In January 2024, a serious incident occurred when a door panel detached from a newly delivered 737 Max shortly after takeoff, exposing the plane to potential danger. Investigations revealed that the panel had not been properly secured, a mistake that highlighted significant quality control lapses at both Boeing and its key supplier, Spirit Aerosystems. This incident raised fresh concerns about Boeing’s commitment to safety, a topic that had already been in the spotlight following two fatal crashes involving another 737 model, the Max 8, in 2018 and 2019.

These challenges forced Boeing to halt production temporarily and prompted regulators to demand substantial changes in its safety and quality procedures. In response, Boeing appointed Kelly Ortberg as CEO in August 2024, hoping that his engineering background would bring stability and restore confidence in the company.

Despite efforts to stabilize operations, Boeing faced additional setbacks. The company was forced to delay the introduction of the 777X, a new version of its long-haul aircraft, which had already been delayed for years. Originally expected to enter service in 2025, the aircraft will now not carry passengers until 2026.

Boeing’s commercial aircraft deliveries were also far behind its main competitor, Airbus, which delivered 766 planes in 2024. Boeing only managed to deliver 348 commercial aircraft during the year.

While the company’s defense division faced less public scrutiny, it was equally affected, reporting a loss of over $5 billion due to rising costs on military contracts.

Despite these setbacks, Ortberg remained optimistic, stating, “We made progress on key areas to stabilize our operations during the quarter and continued to strengthen important aspects of our safety and quality plan.” He emphasized that the company was committed to making the necessary changes to recover and rebuild trust with its stakeholders.

The rise of DeepSeek, a Chinese artificial intelligence (AI) app, has caused a significant stir in the tech industry, as it surged to the top of Apple’s App Store, surpassing established competitors like ChatGPT. The app’s popularity has triggered a selloff of shares in major tech firms, including Nvidia, Microsoft, and Meta, with European stocks also experiencing a decline.

DeepSeek’s rapid ascent has raised eyebrows across the industry, challenging the belief that the U.S. holds an unchallenged lead in AI technology. The app is powered by the DeepSeek-V3 model, which researchers claim was developed for less than $6 million—significantly lower than the billions spent by rival companies. However, some in the AI community have questioned the validity of these claims.

The app’s success comes as the U.S. has imposed restrictions on the sale of advanced chip technology to China, a move that has spurred Chinese AI developers to innovate by sharing resources and exploring alternative approaches. As a result, AI models have become more cost-efficient and require less computing power, potentially disrupting the industry’s economic structure.

Following the launch of DeepSeek-R1 earlier this month, the company claimed its performance rivaled that of OpenAI’s latest models, particularly in tasks like math, coding, and natural language processing. Marc Andreessen, a Silicon Valley venture capitalist and advisor to former President Donald Trump, compared the rise of DeepSeek to the Soviet Union’s launch of Sputnik, suggesting that the U.S. has once again been caught off guard by a technological competitor.

The app’s surge has rattled markets, with companies like ASML, a Dutch chip equipment maker, and Siemens Energy, a manufacturer of AI-related hardware, seeing significant drops in share prices. Fiona Cincotta, senior market analyst at City Index, pointed out that the introduction of a low-cost Chinese AI model has taken many by surprise, raising concerns about the profitability of established rivals.

Vey-Sern Ling, a technology equity advisor based in Singapore, warned that DeepSeek’s success could undermine the entire AI supply chain investment case. However, analysts at Citi noted that the challenges faced by Chinese companies, such as the ongoing chip restrictions, could hinder DeepSeek’s long-term development.

Despite the potential disruptions, DeepSeek’s founder, Liang Wenfeng, remains confident in his company’s direction. The 40-year-old, who founded the company in 2023 in Hangzhou, has been an influential figure in the Chinese tech scene. He reportedly built a large stockpile of Nvidia A100 chips, which were later banned for export to China, and combined them with less advanced chips still available for import. Liang’s innovative approach has caught the attention of both industry experts and Chinese government officials.

As DeepSeek continues to challenge U.S. tech giants, the global AI landscape is expected to undergo significant shifts in the coming years.