A substantial source of financing for Boeing's international customers won't be automatically renewed by Congress after the charter for the Export-Import Bank expires on Tuesday. The potential loss of numerous emerging-market customers comes as a headache for Boeing, adding a new complication to the jumbo jet-buying process.
Boeing will now have to decide whether to foot the bill itself to help supply credit to customers in riskier countries or accept the potential loss of customers and scale back production.
If Boeing manages to firm up a 20 aircraft deals with Volga Dnepr, the jumbo-jet assembly line would have enough business for another two years. Earlier this month, Boeing announced that the Russian cargo operator agreed to purchase 20 747-8 freight planes valued at $7.4 billion.
Without financing support from the Export-Import Bank, Boeing could lose multiple emerging-market buyers to European competition, which has three government-supported export credit agencies available.
The government-backed financing has come under scrutiny from critics who have labeled it crony capitalism, while supporters of the Export-Import Bank have called for a meeting with Congress to discuss a revival of the charter.
Earlier Tuesday came news that Europe's Airbus beat Boeing for a contract to refuel South Korea's military tankers. The deal is worth an estimated $1.33 billion.
Shares of Boeing traded at $139.99, up 66 cents, on Tuesday afternoon. The stock is up 7.3% year to date.