Beaten by the pandemic, Boeing was humiliated in March as a symbol of the power of the United States and went to the markets to look for funds to finance its fragile operations. But he had no luck. While it raised $ 25 billion, that step showed that it faces a new era in its 103-year history: Boeing is no longer that infallible mastodon that dominated the aviation market for decades. Boeing accumulates cancellations of purchase orders for its flagship product, the 737 MAX, which have been on the ground for more than a year worldwide after two accidents that killed 346 people and revelations that weakened the company’s image. In addition, appetite for the 787, its last revolutionary aircraft, decreased considerably.
Boeing’s future, which contributes 1% to the GDP of the world’s largest economy, is now clouded by the planetary health crisis that decimated air transport and also by the unrelenting competition from its European rival Airbus. “Boeing has serious financial challenges,” says Stan Sorscher, a former Boeing engineer. “Air traffic has sunk, the planes are on the ground, customer airlines do not need new planes, and the capacity of their supply chain providers is in question,” he adds. Scott Hamilton, an expert at analytics firm Leeham, went further: “Boeing’s great challenge is to survive.” And the group’s CEO David Calhoun admits that he lost ground.
In the face of such crises and weaknesses, financial rating agencies, which judge a debtor’s ability to honor its loans, downgraded Boeing’s rating to just one notch above that of risky investment. For a long time, Boeing was considered a bankruptcy-covered company. It claims to have 17,000 suppliers in the United States, 2.5 million jobs and is one of the Pentagon’s largest suppliers.At the beginning of the crisis, Boeing sought help from the federal government for 60,000 million dollars and gained strong support in Washington, including that of President Donald Trump himself, who in April affirmed “We cannot allow Boeing to get something.” However, to help her, the government considered demanding severe counterparts to prevent public money from being used to pay dividends or executive compensation.