Boeing reports $449 mn 3Q loss, will cut 7000 more jobs
Oct 29 2020
Boeing's commercial jetliner arm reported a loss of $1.4 billion in the quarter as sales fell 56%.
According to Boeing's latest figures today, the company has made a total net loss of $3.502 billion so far this year.
Chicago-based Boeing posted a quarterly loss of $466 million, or 79 cents a share.
The Covid-19 pandemic has brought air travel to a near halt, pushing major airlines to the brink of bankruptcy and forcing them to seek government aid, cut costs and defer aircraft deliveries - when Boeing gets paid most of the money for new jets.
Calhoun has emphasized that while Boeing faces a hard medium-term environment, it expects airline demand to eventually return and the company is well positioned in the defense and space business, which is steadier than commercial travel.
Once a prodigious cash generator, Boeing is now carefully monitoring its liquidity and soaring debt while navigating an unprecedented drop in air travel and working with regulators to lift the Max's grounding. That is far deeper than the 19,000 reduction that the company announced three months ago.
Boeing has slashed production rates and targets as demand has dropped.
Boeing's CEO Dave Calhoun told employees the company aims to have a staff of 130,000 by the end of 2021.
By the end of 2020, there will be a "change to psychology with respect to the vaccine", he said. Earlier this month, it announced it would consolidate production of its 787 Dreamliner, a wide-body plane used mostly for worldwide routes, at a single facility in North Charleston, South Carolina, instead of operating lines there and in the Seattle area.
The company began a massive job-shedding campaign earlier this year and expects to cut 19,000 jobs by year-end out of the roughly 160,000 workers it had globally by end-2019. Southwest's fleet consists entirely of Boeing 737s, and the airline was forced to cancel thousands of flights past year because of the Max grounding. The company, he said, intends to "align to market realities".
The company has also taken steps to raise cash in the face of the hard market, undertaking a $25 billion bond offering in the spring that averted the need to take advantage of a USA government program that had been established for the company.
The head of the US Federal Aviation Administration also signaled the plane could soon be cleared, while emphasizing that work still had to be completed before final approval.
Approximately 450 MAX aircraft are thought to be awaiting delivery.