31 People Share Their Favorite Examples Of Massive Corporate Failure

Olestra. The company spent $5B developing an oil that couldn't be absorbed by the body. The only problem was that the undigested oil had to go somewhere. The FDA made them put a warning label on their products that said "may cause a**l leakage." It didn't sell...

World War II was over. Germany was a bombed-out smoking ruin. The victors saw that communism was taking hold in countries with collapsed economies, so they wanted to resurrect the economies of Europe. They were desperate to just get people working again. They'd try anything that had a ghost of a chance at working.

The U.S. essentially told Ford that they'd give them the Volkswagenwerk, the factory that made VWs. If Ford were to take over, just run this factory and make some cars, get people back to work, they could have it for free.

Henry Ford II told his board of directors: "Gentlemen, what we're being offered here isn't worth a damn." And declined the offer.

Target's expansion to Canada was a disaster.

They spent billions purchasing existing Zellers (Canadian department store) locations from Hudsons Bay Company (HBC). Then they spent 100s of millions more renovating them. They leased more locations to open stores. 133 in total. Due to a variety of issues, mainly distribution problems -they tanked, Target Canada declared bankruptcy and had to pay more millions to get out of leases and sell their owned real estate. This all happened in about 5 years.

My favourite part of the story is the HBC took some of the proceeds from the sale of Zellers and bought Saks Fifth Avenue with it. They're recently begun re-opening Zellers

Hasbro laying off all their staff at wizards of the coast in their DND and Magic The Gathering divisions. You don't gut the only departments responsible for your only reason for profit and growth. Like WTF are they thinking unless the CEO is planning on shorting his own company stock?

The Metaverse

Lenovo shipping laptops loaded with the Superfish malware. 

IBM. They let Microsoft retain the rights to the PC operating system they put on the IBM PC.

The entire Penn Central disaster. The railroad was massive but terribly managed and lasted less than 3 years before becoming the biggest bankruptcy in US history at the time

Southwest airlines last Christmas

Boeing. Bought their biggest US competitor after they watched it torch itself with Jack Welch MBA cultists. Just ended up eating the MBA cancer too and now it's terminal. 777 - last 100% old B aircraft. Smooth rollout to unanimous praise. The last Great Boeing plane. 787 - amazing generational leap design, but some major problems with production and some typical teething problems with such a new & advanced design. MBA cultists start injecting their poison and production optimized to ~~crush their experienced union workforce~~ allow it to be "assembled like Legos" anywhere. All production moved to SC after 2021 despite continued production quality problems that won't go away at SC. Also f**k you WA taxpayers who gave B a huge tax break if 787 production stayed in WA, but holding B accountable would make B have a sad and politically hard and we can't have that now can we? MBA cultists are clearly now in control. Delays and problems cost B ~$6B as of Q1 23. Those extra costs mean less gas in the tank for new projects. Maybe. 737 Max - Old B engineers completely pushed out of all strategic decision making and after Airbus spooked management with the NEO in the 10's, decided to go with a quick slapped together new engine option plus some updating version of the 737 and abandoning project Yellowstone. This is despite old guard B engineers feelings that 737 NG was supposed to be "the last 737." Major hoops jumped through (including jumping through their own a*****e) to keep on same 737 type rating at all costs. So much outsourcing. Avionics design flaw makes it through certification due to said outsourcing, corporate malfecense, and FAA regulatory capture and get their pee pee slammed in the car door. Yellowstone aircraft would have cost $10B. Max was supposed to cost $4-5B. Total costs for Max f**k up now north of $20B. Between 787 and Max f**k ups, B now behind $25ish billion. Sure would be nice to have that money for the new aircraft they need to bring to market in the 2030's now wouldn't it? Don't forget closing down Long Acres campus in 2021. Old B is now dead. SLS - What a complete disaster of a program. Over budget, behind schedule, and very nearly a PR disaster with the Artemis 1 launch. Test vehicles still can't even do what they are supposed to do. The worst example of govt pork barrel/make work program and corporate ineptitude. Boeing is mostly staying afloat by virtue of being the sole large heavy aircraft production company left in USA and is "too big to fail." I dream that Boeing Commercial Aircraft is spun off and they can get back to their roots of designing amazing commercial aircraft.

Xbox as a brand over the course of one generation went from a serious player compared to its closest corporate competitor to an afterthought. Although technically the PS3 outsold the 360 by the end of the generation, I'd argue that the 360 was still the more recognizable face during the time.

Then the PS4 vs Xbox One generation occurred and through a series of incredibly dumb and baffling decisions, Xbox lost substantial market share. During the FTC trials against Microsoft trying to acquire ABK, MS said that they lost the most important generation, and while a lot of wild claims were made during the trials, this wasn't one of them.

The PS4 era is when a lot of people established large digital libraries of games and made a lot of friends and really locked people into a platform.

Even if Xbox suddenly turned things around and started pumping out incredible, exclusive games and made a new console that was all-around more technically capable than Sony's, I still think they'd lose a follow up generation simply because it's so hard to migrate from one platform to another without losing friends and money sunk into digital games.