The Boeing logo is pictured at its Renton plant, where Boeing 737 MAX airliners are built in Renton, Washington, April 20, 2020.
JASON REDMOND | AFP via Getty Images
Boeing On Thursday, he said he did not plan to seek federal help after raising $ 25 billion in a bond offering, the largest debt sale the company has ever made, as it faces what it expects to be a multi-year drop in air travel due to the coronavirus pandemic.
“Following the response, and pending the closing of this expected transaction on Monday, May 4, we do not plan to seek additional funding through capital markets or US government options at this time.” , he said in a statement.
The $ 2.2 trillion in federal coronavirus relief approved by Congress last month has set aside $ 17 billion in federal loans for companies deemed to be national security interests, according to a Boeing bill. Boeing CEO Dave Calhoun has balked at the possibility of providing the government with an equity stake in exchange for federal aid, but this week said all options were on the table.
When asked if the company would apply for government loans, Calhoun told CNBC this week that “credit markets have eased considerably” recently after a number of stimulus programs.
CFO Greg Smith, in an article on the bond offering, thanked the Trump administration for the recent stimulus and called the investor response to the Boeing debt sale “a testament to confidence. that the market has in our business, our people and our future. “
Boeing and its main rival Airbus both face the biggest crisis in their history as demand for new jets evaporates during the pandemic and they burn money. The dismal environment for new passenger planes and aircraft services makes Boeing more dependent on its defense arm.
Boeing rushed to consolidate liquidity and recently withdrew a nearly $ 14 billion loan. CEO Calhoun told investors on Wednesday that the company “is intensely focused on ensuring liquidity during the immediate crisis.”
Boeing announced its second consecutive quarterly loss on Wednesday. The company is cutting 10% of its workforce, which numbered around 160,000 at the end of last year, and is cutting production of planes including the 787 Dreamliner. Calhoun said this week that it will likely take two to three years for travel demand to return to 2019 levels.
The pandemic is a new crisis for the company which was already battling the fallout from two fatal crashes to its 737 Max that killed all 346 people on the flights. The plane has been grounded by regulators around the world since March 2019 and it is not known when it will be cleared to fly again.
Correction: A previous version of this story misstated the size of the federal coronavirus relief package. It was $ 2.2 trillion.