Whatever it takes. In short, that has been President Donald Trump’s message to airlines and the aerospace industry to help both sectors financially during the current Covid-19 crisis. Airlines say they would need some $50 billion while the aerospace industry has pleaded for a $60 billion cash injection. And that’s the minimum.
Boeing is leading the aerospace manufacturing coalition that has asked for $60 billion in public and private liquidity that includes loan guarantees. “Funds would support the health of the broader aviation industry, because much of any liquidity support to Boeing will be used for payments to suppliers to maintain the health of the supply chain”, Boeing said in a statement on March 17.
“The long term outlook for the industry is still strong, but until global passenger traffic resumes to normal levels, these measures are needed to manage the pressure on the aviation sector and the economy as a whole.”
Covid-19 has hit Boeing hard. Directly, as some workers have been infected by the virus and have been sent home, just as some of their colleagues. Plus the timing of the crisis: right in the middle of Boeing’s weakest position ever in which it has burnt cash as grouding of the MAX has now entered its 13th month.
To keep its liquidity position, Boeing has fully drawn on the $13.8 billion credit facility provided by Citibank, JP Morgan Chase Bank, Bank of Amercia Securities, and Wells Fargo.