Airplane maker Boeing (BA) - Get Report, navigating the worst downturn for the airline industry ever, has asked White House and congressional officials for short-term aid for itself, its suppliers and airlines as the coronavirus pandemic afflicts never-before-seen damage on the travel industry.
“Short-term access to public and private liquidity will be one of the most important ways for airlines, airports, suppliers and manufacturers to bridge to recovery,” Boeing said in a statement. “We appreciate how the administration and Congress are engaging with all elements of the aviation industry during this difficult time.”
Boeing, European rival Airbus and a network of suppliers are navigating the sharpest industry downturn since at least the 9/11 terror attacks as nations close their borders, forcing people onto the ground, and as airlines cut unprecedented routes and service.
The U.S. plane maker is seeking to avoid layoffs and damage to hundreds of smaller companies that make parts and systems for its aircraft. At the same time, it is still grappling with hundreds of grounded 737 MAX aircraft, which it had been working on getting re-certified and back up in the air following two deadly crashes a year ago.
In national television and on Twitter, President Donald Trump has said that the U.S. government would “back the airlines 100%.” A trade group, Airlines for America, said passenger carriers need $50 billion in aid, plus another $8 billion for air cargo companies.
Meantime, S&P Global Ratings downgraded Boeing to BBB, or two steps above junk. In addition to a weaker-than-expected recovery due to the prolonged 737 MAX grounding, "... the significant reduction in global air travel due to the coronavirus will likely result in an increase in aircraft order deferrals, further pressuring cash flows,” it said.
Shares of Boeing were down 2.24% at $126.71 in morning trading on Tuesday. The stock fell nearly 24% to $129.61 in New York on Monday, its lowest since September 2016. The shares have lost more than half their value this year, making Boeing the biggest laggard on the Dow Jones Industrial Average.