Boeing’s Financial Woes: A Desperate Bid for Stability
The aviation giant has been struggling to stay afloat, with no annual profit since 2018 and a staggering loss of $25 billion. In a bid to rectify its financial situation, Boeing has announced plans to raise up to $25 billion in new stock and debt over the next three years.
A Swift Move to Raise Capital
The company is wasting no time in its efforts to raise the much-needed cash. According to reports, Boeing has already finalized a deal to sell its small defense subsidiary, Digital Receiver Technology (DRT), to Thales Defense & Security, a division of Thales SA, Europe’s largest defense electronics firm.
DRT: A Strategic Sale
DRT, based in Maryland, designs and manufactures complex Software Defined Radio (SDR) systems used by the intelligence, defense, and homeland security communities to gather, analyze, and share signals intelligence. While the terms of the deal remain undisclosed, the sale is expected to contribute to Boeing’s ambitious fundraising goal.
A New Era of Austerity
In a separate announcement, Boeing’s new CEO, Kelly Ortberg, revealed plans to cut approximately 17,000 jobs and delay the launch of a new 777 airliner. The company has been facing significant strain due to the ongoing strike by 33,000 machinists, which has crippled production for over a month.
Labor Disputes and Layoffs
The union is set to vote on a new deal this Wednesday, which would increase pay by 35% over four years and provide $7,000 ratification bonuses to workers. However, if an agreement is not reached by the end of next month, the temporary furloughs of 700 workers at Spirit AeroSystems, a company Boeing is acquiring for $4.7 billion, will become permanent layoffs.
A Long Road to Recovery
As Boeing navigates these challenging times, it remains to be seen whether the company’s efforts to raise capital and reduce costs will be enough to restore stability and drive growth. One thing is certain – the road to recovery will be long and arduous.
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