ABSTRACT
McDonnell Douglas has had an extremely successful decade in the 1970s. From 1970–1979 the firm recorded total Government sales of over $20 b., nearly.62% of total corporate sales. McDonnell Douglas has consistently ranked as a leading contractor for both department of defense and NASA. The company entered the decade as a strong contractor. In 1967, McDonnell had absorbed the Douglas Aircraft Company in Long Beach, CA. In 1974, a brief controversy erupted over the Renegotiation Board’s decision on McDonnell Douglas’ 1967–1969 profits, which combined higher profit rates in St. Louis with the lower profit rate of Douglas Aircraft’s operations. The only major problem for the firm came on the commercial side: the Chicago crash of the DC-10 in 1979. It was unclear how this accident might affect the firm. Some analysts saw the impact as short-lived, while one McDonnell Douglas employee noted: “The most devastating result would be that customers become suspicious of our technology and engineering”.
