April is the cruelest month for Boeing. As of April 6, the aerospace and defense giant’s Puget Sound, Washington, sites were closed indefinitely for deep cleaning, and Boeing is trying to convince workers to come back after at least one local death from the COVID-19 pandemic was reported in late March. That same day, the company announced that work at its factory in Charleston, South Carolina, was suspended, too.
Meanwhile, Boeing is asking if there are some workers who do not want to come back at all.
On April 2, Boeing announced voluntary layoffs, and CEO and President David Calhoun acknowledged there likely will be changes coming to its product lines. But as monumental as those changes might be, they are not the biggest concern. Instead, the OEM first must figure out how to finance itself through the rest of the year.
The numbers were well-publicized in March as the U.S. Congress raced to pass its multitrillion-dollar stimulus and relief bill in response to the coronavirus pandemic, the CARES Act. Jaws dropped when Boeing sought a $60 billion aid package for itself and its suppliers as part of the legislative sausage-making.
But it is easy to see why it did so: Short-term commercial paper financing is frozen as a recession suddenly grips the U.S. and likely the world. Boeing Chief Financial Officer Greg Smith said access had dried up, at least temporarily. Calhoun tried to offer a brave face and said Boeing has access to $15 billion in cash and another $9.6 billion revolving credit line.