Precision Castparts
Aerospace manufacturer serving Boeing and Airbus posted $10.4B revenue in 2024, rebounding 24% in profits after $11B pandemic writedown.
Warren Buffett called it his biggest mistake. For eight years after the 2016 acquisition, Precision Castparts bled value—$11 billion in writedowns by 2020 as aerospace demand collapsed during COVID. But 2024 delivered vindication: $10.4 billion in revenue, up 12% year-over-year, with pre-tax profits surging 24% to $1.9 billion. The manufacturer that produces complex metal components for Boeing, Airbus, GE Aerospace, and Rolls-Royce finally returned to pre-pandemic scale.
The turnaround mirrors biological recovery after environmental stress. Like forests regenerating after wildfire, PCC's manufacturing network reactivated dormant capacity as commercial aviation rebounded. First-half 2024 revenues hit $5.2 billion—a 12.6% jump—driven by aerospace orders, not forced efficiency programs. The company's distributed production system, spread across specialized facilities for castings, forgings, and fasteners, functions like mycorrhizal networks: each node serves distinct niches (engine parts, structural components, fastening systems) while sharing resources through Berkshire's capital allocation.
What makes PCC's structure resilient is resource allocation without central interference. Berkshire provides capital but demands no integration with other subsidiaries, no shared services, no corporate synergies. Each production facility maintains local adaptation to customer specifications and regulatory requirements—the aerospace equivalent of endemic species evolving to specific microclimates. When Boeing's 737 MAX grounding hit in 2019, PCC's diversification across multiple airframe manufacturers and engine makers prevented complete collapse.
The 2024 recovery reveals the value of patient capital. While standalone aerospace suppliers faced bankruptcy or fire sales during the pandemic, PCC weathered the crisis through Berkshire's $171 billion insurance float. No desperate cost cuts, no workforce purges, no asset sales. The result: when airlines resumed aircraft orders in 2023-2024, PCC retained the engineering expertise and production capacity to capture the upswing. The rebound narrowed Berkshire's cumulative losses on the acquisition, proving that industrial ecosystems require time horizons measured in decades, not quarters.