Connect with us

Coronavirus (Covid-19)

Stormy skies for Boeing as Coronavirus compounds dire situation




As the world’s Covid-19 cases continue to rise, aircraft manufacture Boeing is watching its stocks slide. From around US$384 a share back in September last year to as low as US$154.84 last week. It’s since bounced back to US$170.20, but a long, long way from its peak. Most of the losses kicked in from mid-February when the extent of the Coronavirus, and its impact on the airline business, became apparent.

Boeing lost US$52 billion on the stock market in just one week. The rout underscores the challenges facing the US aircraft manufacturer in a perfect storm of problems – the rise of the Covid-19 coronavirus and its impact on airlines, and the company’s self-inflicted crisis over the Boeing 73 Max aircraft.

The problems with Boeing will have a profound effect on business sentiment in the US.

Richard Aboulafia, an aviation consultant at Teal Group says the 104 year old company was a safe bet, because it has driven multiple technological revolutions and operates in a safe and growing market.

“But these beliefs are being tested. Boeing is in distress and a lot of that is self-inflicted.”

According to AFP banking sources, the Seattle-based aircraft manufacturer drew on the full US$14 billion credit line it only just secured from banks last month.

Boeing, facing hundreds of lawsuits from families of passengers on the doomed Ethiopian Airlines and Lion Air 737 MAX aircraft which crashed, wants to make sure it has enough reserves to deal with any unexpected problems in the current “uncertain climate”.

It doesn’t get much more uncertain than the current situation.

The two deadly crashes killed a combined total of 346 people.

Boeing told AFP that it estimates that the 737 Max crisis will cost it at least US$18.7 billion, which has caused its debt to explode to US$27 billion as of the end of last year. The manufacturer has neither produced nor delivered any Max aircraft in the past three months. The model has been grounded for a year.

With a return of the 737 Max to the skies uncertain, hundreds of almost-complete aircraft sitting gathering dust, and sales of the 787 slowing, Boeing’s financial situation is teetering. And then there’s the coronavirus.

Around the world airlines are having to drastically alter schedules, put off flight and ground staff, cancel orders for new planes and re-assess their business plans as passengers stay home and borders close.

The coronavirus pandemic now poses the most serious crisis for the airline industry since September 11, 2001. Last week Delta Air Lines decided to postpone deliveries of new aircraft, while United Airlines is only taking on new aircraft if it believes it can pay for them.

American Airlines announced over the weekend that it plans to cut 75% of its international flights through to May 6 and ground nearly all its wide-body fleet.

A week ago, UK airline Flybe collapsed Thursday as a slump in demand for flights because of the novel coronavirus outbreak dealt the final blow to the struggling carrier.

The Boeing 737 Max assembly plant alone employs 12,000 people. When Boeing suspended production of the MAX in January, most economists believed that this decision would affect US growth in the first half. Now its knock-on effects to a beleaguered US business sentiment will have even greater impact.

And whilst it is likely, at some stage, the world will see a major reduction in active coronavirus cases, there is still doubt whether the Boeing 737 Max will ever fly again.

Stormy skies for Boeing as Coronavirus compounds dire situation | News by Thaiger

GRAPHIC: Boeing Company shares over the past 6 months – Google


Get more from The Thaiger

📱 Download our app on Android or iOS
👋 Have your say on our Thailand forum
🔔 Subscribe to our daily newsletter
📺 Subscribe / Join for daily shows
👍 Like/Follow us on Facebook
🐦 FOLLOW us on Twitter
📷 FOLLOW us on Instagram


Join the conversation and have your say on Thailand news published on The Thaiger.

Thaiger Talk is our new Thaiger Community where you can join the discussion on everything happening in Thailand right now.

Please note that articles are not posted to the forum instantly and can take up to 20 min before being visible. Click for more information and the Thaiger Talk Guidelines.

Click to comment

You must be logged in to post a comment Login

Leave a Reply

If you have story ideas, a restaurant to review, an event to cover or an issue to discuss, contact The Thaiger editorial staff.

Follow Thaiger by email:

Singapore1 hour ago

Singapore Airlines launches 60 minute A380 flights

Thailand News Today14 hours ago

Thailand News Today | Thailand says no to Sinovac, Anutin stands by booster vax, Burmese junta takes u-turn | Oct. 19

Coronavirus (Covid-19)16 hours ago

Covid-19 Tuesday: 9,122 new cases, 71 deaths, port of entry data

Sponsored2 days ago

SO Sofitel Hua Hin opens its doors to welcome all visitors!

Welcome back to Thailand!

Thaiger is getting behind local businesses for the restart of tourism in Thailand - up to 50% discounts across all advertising packages!

Thailand18 hours ago

Thai culture, tourism, Thailand pass, chit chat | Thaiger Bites | Ep. 41

Crime18 hours ago

Arrest made for the 14 year old murder of pregnant girl

Crime19 hours ago

Cyber fraud case renews talks over the safety of online banking

Join the conversation on the Thaiger Talk forums today!
Crime20 hours ago

Myanmar’s junta government releases prisoners, cancels arrest warrants

Politics20 hours ago

North Korea continues testing ballistic missiles

Thailand21 hours ago

No more Sinovac, Thailand pass details, BKK airport expansion | Good Morning Thailand | Ep. 112

Media21 hours ago

Virtual influencers a rising force in Thailand

Thailand21 hours ago

Thailand Top Stories | Police investigate online bank fraud, BKK airport expansion | October 19

Politics21 hours ago

MP queries appointment of army general to oversee Covid-19 in southern Thailand

Politics22 hours ago

Former U.S. president Trump sues House committee over records request

Coronavirus Vaccines22 hours ago

Anutin rejects suggestion booster doses should stop until everyone gets first dose

Coronavirus (Covid-19)23 hours ago

Covid-19 pill treatment highly effective at preventing hospitalisation, death

Thailand1 month ago

Morning Top Stories Thailand | Police to end protests, Human Trafficking | September 14

Thailand8 months ago

Thailand News Today | Thai Airways in rehab, All go for Songkran | March 4

Tourism8 months ago

Phuket’s nightlife. Yes, bars and clubs are still open | VIDEO

Phuket8 months ago

Thailand News Today | Covid passport talks, Thai Airways heads to court | March 2

Tourism8 months ago

Phuket Thai food treats you need to try | VIDEO

Thailand8 months ago

Thailand News Today | Bars, pubs and restaurants ‘sort of’ back to normal | Feb 23

Tourism8 months ago

In search of Cat & Dog Cafés in Phuket Town | VIDEO

Thailand9 months ago

Thailand News Today | Gambling crackdown, Seafood market to reopen, Vlogger challenge | Jan 21

Thailand9 months ago

Thailand News Today | Covid testing for visas, Business impact, Vaccine approval | January 19

Thailand9 months ago

Thailand News Today | Weekend Bangkok bombs, Thailand fires, Covid update | January 18

Thailand9 months ago

Thailand News Today | Stray car on runway, Indonesian quake, 300 baht tourist fee | January 15

Thailand9 months ago

Thailand News Today | Governor off respirator, sex-trafficking arrest, condo prices falling | January 14

Thailand9 months ago

Thailand News Today | Chinese vaccine, Thailand ‘drug hub’, Covid update | January 13

Thailand9 months ago

Thailand News Today | Bangkok may ease restrictions, Phuket bar curfew, Vaccine roll out | January 12

Thailand9 months ago

Thailand News Today | Covid latest, Cockfights closed down, Bryde’s Whale beached | January 11