Boeing Seeks $60 Billion Assistance
Boeing said on Tuesday it was seeking at least $60 billion in “government aid” including loan guarantees. The aviation giant’s shares in the stock market were falling like rocks well before the COVID-19 disruptions. It has already been facing significant financial troubles due to the grounding of its 737 Max plane.
CNBC’s Jim Cramer on Wednesday called on the Federal government to follow through the company. He asked to provide them assistance as the coronavirus continues to impact the aerospace industry and the economy negatively.
Cramer said it’s a plea for the 2 million workers who are in the supply chain. It will run out of money if it doesn’t receive government assistance, he added.
What Happened to Boeing Prior to COVID-19 Disruption?
The company is the nation’s largest manufacturer, employing more than 100,000 people domestically. Its supply chain includes thousands of big and small businesses around the United States. It manufactures both commercial and military aircraft, missiles, satellites and other defence equipment.
In stock trading, the tumbling of its price has pulled down to more than 40% of the markets in recent weeks. Donald Trump said the worldwide grounding of 737 Max contributed to a drop in the gross domestic product. After two fatal crashes that left 346 people dead, the 737 Max plane was grounded, causing strain to the company.
Adding to the strain, the novel coronavirus pandemic is pushing them to the brink.
What is President Donald Trump’s Position on the Assistance Request?
Boeing’s workers, clients and the public had lost confidence in its management, which was in disarray. The Max disaster has not been settled, as well as other problems such as airlines being stuck with airplanes they can’t use. These instill fears among their customers.
The manufacturer has economic and military importance. One option the US government can consider is requiring the military business to be stock listed separately or even privatized. On the commercial side, the government should have oversight of the company’s operations from management down to factory floor workers.
President Trump said Tuesday he would strongly consider a bailout for the company which is a top US defence contractor. The airline was in favor of an enormous government support package as the aerospace industry struggles due to COVID-19.
In more stocks news, Boeing stock plunges to a 7-year low. Bailout fails to comfort investors on potential liquidity issues still due to COVID-19.
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