Boeing terminated its two-year-old, $4.2 billion agreement to acquire the commercial operations of Embraer, a leading regional-jet manufacturer based in Brazil, as the April 24 deadline for sealing the deal passed.
Tag: Aviation
Boeing has put its chief financial officer in charge of a newly formed group called Enterprise Operations, Finance & Strategy, as part of a reorganization aimed at streamlining the company’s top leadership and preparing for what Boeing calls “the post-pandemic industry footprint.”
Boeing says it’s planning to resume all commercial airplane production in the Seattle region starting next week, more than three weeks after operations were shut down due to the coronavirus outbreak.
About 27,000 employees will be brought back to work sites ranging from Boeing’s wide-body airplane factory in Everett to its 737 production facility in Renton, using a phased approach, the company said in a news release.
Boeing said it’s taking extra precautions to keep its workers safe.
Seattle-based Alaska Airlines and nine other air carriers plan to participate in a $25 billion payroll assistance program that’s part of the coronavirus relief package signed into law last month, Treasury Secretary Steven Mnuchin said today.
“Conversations continue with other airlines regarding their potential participation,” Mnuchin said in a statement.
Today’s announcement comes after days of negotiations over the terms of the assistance program, with the Treasury Department seeking ownership stakes in at least some of the airlines that participate.
Boeing says it will bring about 2,500 employees back to its facilities in the Puget Sound region and Moses Lake, Wash., starting as early as April 13, for limited operations that will focus on defense programs and 737 MAX storage and maintenance.
Boeing says its 14-day suspension of operations at its Puget Sound airplane factories, as well as at its maintenance site at Moses Lake in central Washington state, will be extended until further notice.
The Air Force says it reached two agreements with Boeing today, aimed at making the final fixes in camera systems for Boeing-bult KC-46A Pegasus tankers and releasing $882 million in payments that were held back due to problems with the tankers.
Boeing CEO David Calhoun says the company is preparing a voluntary layoff program that’s aimed at reducing the need for “other workforce actions” as it deals with the economic repercussions of the coronavirus pandemic.
In a letter sent to employees, Calhoun said details about how the program works will be laid out in the next three to four weeks. Speaking on background, a Boeing official said several thousand employees are expected to take the voluntary layoff package or retire.
For the past year, Boeing has been struggling with the worldwide grounding of its 737 MAX passenger jets in the wake of two catastrophic crashes. The company was targeting the middle of this year to resolve all the safety issues and win the Federal Aviation Administration’s go-ahead to put the planes back into operation.
Then the pandemic hit. Last month, reports emerged about COVID-19 cases — and at least one death — among employees at Boeing’s production facilities in the Puget Sound region. Those facilities are now in the middle of a 14-day shutdown while Boeing conducts deep-cleaning operations at the plants and assesses the wider impact of the coronavirus outbreak.
Calhoun said Boeing was “doing everything possible to keep this team intact” during the pandemic.
“But one thing is already clear: It will take time for the aerospace industry to recover from the crisis. When the world emerges from the pandemic, the size of the commercial market and the types of products and services our customers want and need will likely be different. We will need to balance the supply and demand accordingly as the industry goes through the recovery process for years to come,” he told employees.
“It’s important we start adjusting to our new reality now,” he wrote.
The U.S. Navy has awarded Boeing a $1.5 billion production contract for the next 18 P-8A Poseidon maritime patrol aircraft, buoying the company’s defense business.
Even as Boeing begins a 14-day production shutdown in the Puget Sound due to the coronavirus outbreak, the aerospace giant is in line for a financial booster shot, thanks to provisions in the $2 trillion relief package drawn up in the Senate.
Boeing’s stock ended the trading session with a 24% gain. Airline stocks rose as well, thanks to $50 billion in promised loans and grants for passenger airlines, and another $8 billion for cargo carriers.
The Senate bill, which hasn’t yet come up for a vote and could still undergo revision, doesn’t specifically call out Boeing. But it does set aside $17 billion in loans for businesses that are considered “critical to maintaining national security.” Sources told The Washington Post that this provision was meant to cover Boeing’s needs, although other companies could be eligible for some of that aid.
That $17 billion by itself doesn’t fully address Boeing’s request for $60 billion in assistance. Other sources of funding — public as well as private — could fill the gap.