(Bloomberg) — Boeing Co . is considering options for its Starliner operations as part of a broad overhaul, raising the potential that it will end one of the most storied stories in American space exploration.

Although the assessment of whether to walk away from a key NASA program is still in its early stages, it is the most concrete step yet by the US aerospace industry to rethink its role in the commercial space industry.

Boeing has remained the most prominent of the legacy aerospace manufacturers working with NASA as Elon Musk’s SpaceX has risen from an upstart to the industry’s dominant force. A scaled-down Boeing — or one that’s completely absent from the industry — would leave the U.S. government inextricably dependent on SpaceX to put astronauts into space from American soil, at least until other companies enter the market.

“Having a resilient way to get astronauts to the space station is at risk,” Clayton Swope, deputy director of the Aerospace Security Project at the Center for Strategic and International Studies, said of Boeing’s review.

Boeing’s new CEO Kelly Ortberg is evaluating the company’s portfolio to raise money, weed out underperforming units and save a company in crisis. The review of the Starliner program signals that Boeing may wind down or sell a business marred by years of failures with more than $1.8 billion in cost overruns and delays.

Dumping the Starliner would mean turning its back on a roughly 60-year line of flying American astronauts into space — from the iconic Saturn V rocket that carried Neil Armstrong to the moon to the plane-like shuttles that flew to the International Space Station, which Boeing manages for present.

With the Starliner facing multiple delays, SpaceX’s rival Crew Dragon capsule has made 43 visits to the ISS since 2019, carrying both crew and cargo for NASA. The agency recently hired SpaceX to rescue two Americans stuck on the space station, after the Starliner’s traction problems forced the agency to order the vehicle to return to Earth empty.

“Boeing was supposed to be the safe bet,” said Chad Anderson, Managing Partner of Space Capital and a SpaceX investor. “If they walk away, it’s a sad thing for America, for competition and for access to space.”

Subscribe now: Business of Space newsletter, a weekly inside look at stories about investing beyond Earth.

NASA and Boeing are still working together to resolve the problems experienced during the company’s latest test flight, with the goal of eventually certifying the Starliner for regular crewed flights — unless something changes on the Boeing side, according to a person familiar with the matter.

Boeing does not comment on market rumors or speculation, a spokesperson said by email. A NASA spokesperson declined to comment on Boeing’s review.

The Starliner review comes amid a crippling, six-week labor strike that has halted production of key jetliners, including the cash cow 737 Max. The work stoppage exacerbates Boeing’s strained finances, with its credit rating on the verge of junk and worsening cash burn, which the company expects to stretch into 2025.

Ortberg said he wants to focus resources on Boeing’s core commercial aircraft and defense divisions and is looking to streamline its broad portfolio, with the goal of “doing less and doing it better.” He expects to take a decision on which units are to be divested at the turn of the year.

Even before the news of Boeing’s potential spaceflight, first reported by the Wall Street Journal, the future of the Starliner was unclear beyond a plan for half a dozen more missions to the space station for NASA.

Its costs will likely continue to rise, especially if NASA requires another test run to the space station. The Starliner “may already be obsolete,” Agency Partners analyst Nick Cunningham told clients in a memo Wednesday, calling the vehicle a “disproportionate loss maker.”

Boeing and Lockheed Martin Corp. has been trying to sell its United Launch Alliance joint venture for the past year. Boeing’s space portfolio also includes a lucrative contract for NASA’s SLS lunar rocket, although it is expected to cost about $2 billion per launch and SpaceX says it is working on cheaper options. ISS is headed for retirement.

Boeing is not the only legacy space player to suffer. Airbus SE plans to eliminate as many as 2,500 jobs at its defense and space division as the European plane maker seeks to streamline operations amid tougher competition.

Boeing may decide to keep some or all of its space portfolio, which also includes defense products such as spy satellites and the secretive X-37B space plane.

Yet in the past decade, Boeing has fallen behind major technological leaps made by SpaceX, which has reduced the cost of space travel by reusing boosters and building a majority of components in-house.

Besides the possibility of relying on Russia if SpaceX fails, Anderson said there is a risk to taxpayers and the industry at large if Boeing leaves the business.

“SpaceX is not going to lower prices on its own. Until you bring in more competition, nothing can challenge that,” he said. “Competition is good for everybody. More innovation, lower prices, more participation, more ideas.”

— With the help of Julie Johnson.

©2024 Bloomberg LP