Escalation of Commitment

QUOTE

Will Rogers once said…

“Never let yesterday use up too much of today.”

(American vaudeville performer and actor)

CONCEPT

Escalation of Commitment

Escalation of Commitment—often linked to the sunk cost fallacy—describes the tendency to continue investing time, money, or effort into a failing venture solely because of the resources already spent.

Rather than cutting losses and reallocating efforts toward more promising endeavors, individuals or organizations keep doubling down in hopes of turning things around.

Psychology, group dynamics, and pride frequently amplify this effect, leading people to ignore mounting evidence that a project may be unsalvageable.

STORY

Sonic Boom … or Bust?

In 1962, when the British and French governments agreed to develop the Concorde—the world’s first supersonic passenger airliner—they believed they were forging a glamorous future for air travel.

The promise seemed straightforward and captivating: jet across the Atlantic in less than half the usual time. Early cost estimates hovered around £150–170 million, and the two nations eagerly committed resources to showcase their technological prowess.

But almost immediately, delays and design challenges piled up. Engineers grappled with unprecedented issues—everything from balancing the plane’s weight distribution at supersonic speeds to mitigating the intense heat generated by Mach 2 flight. With each adjustment came new costs, pushing the budget beyond what anyone had anticipated. By the late 1960s, development expenses soared into the hundreds of millions, far exceeding the original projections.

Still, no one was ready to concede defeat.

As the bills continued to balloon, critics pointed out that the market for supersonic travel appeared limited. Environmental concerns, especially sonic booms, restricted the routes Concorde could fly. Airlines balked at the high price tag for each aircraft, uncertain whether enough affluent passengers would consistently pay for such flights. Despite mounting skepticism, the governments remained resolute: they had already poured untold sums of taxpayer money into Concorde.

Scrapping the project would mean publicly admitting a massive financial miscalculation.

Facing these daunting realities, both Britain and France pressed on, ordering additional prototypes, fine-tuning engines, and tweaking the plane’s distinctive delta-wing design.

Concorde finally entered commercial service in 1976—years behind schedule and at a total development cost that some historians estimate exceeded £1.3 billion (a staggering amount for the era). Though Concorde attracted elite passengers and turned heads wherever it flew, it never came close to recovering the monumental investment poured into its creation.

Government officials continued subsidizing flights, hoping the prestige and high-profile aura might justify ongoing losses. Yet, even with tickets costing several times more than a typical transatlantic fare, Concorde struggled to remain profitable.

When an Air France Concorde crashed in 2000, killing all on board, it further eroded public confidence. Commercial flights ceased entirely by 2003, leaving only the memory of a beautiful but costly ambition.

The dramatic cost overruns, environmental hurdles, and limited customer base became footnotes to the underlying message: once too much has been spent—financially, reputationally, or politically—decision-makers often find it painfully difficult to change course, even as the evidence piles up.