Boeing has been struggling with major problems for years, but these have recently become worse due to the strike by employees in the Seattle area. The staff is demanding a 40 percent salary increase and has therefore been off work for almost a month.
As a result, production of most passenger aircraft has come to a standstill (with the exception of the 787, which is built elsewhere). That costs an estimated 100 million dollars in turnover per day and drains the cash register. Boeing announced the layoffs of 17,000 employees on Friday.
Emirates CEO Clark is concerned. “Unless we manage to raise new capital through a rights issue (a share or bond issue, ed.), I see an impending downgrade in the credit rating with Chapter 11 on the horizon,” he told The Air Current.
In Chapter 11 proceedings, a company under protection from creditors is radically reorganized to become financially healthy again. That certainly does not necessarily have to lead to the end of Boeing (that chance is very small, the company is too important for that).
Boeing is expected to try to raise $10 billion through a rights issue to replenish its coffers. Meanwhile, credit rating agency Moody’s is considering downgrading the company’s credit rating to Junk status.
Largest widebody customer
Emirates is the American aircraft manufacturer’s largest widebody customer, with orders for 205 aircraft from the new 777X family and 35 787s. Boeing recently confirmed that delivery of the first 777-9 (the largest variant of the 777X) has been postponed for another year, until 2026.
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Boeing’s Bumpy Flight: A Comedy of Errors
Well, ladies and gentlemen, grab your peanuts and buckle up, because Boeing is on a turbulent ride that makes a roller-coaster look like a merry-go-round! The aerospace giant has been struggling with more than just a few minor hiccups. It’s a full-blown multi-engine failure, and now, with employees in Seattle staging a walkout, the drama is escalating faster than a 787 taking off without a co-pilot!
Employee Demands: More Than Just Chump Change
It seems the staff at Boeing got together and decided, “Hey, instead of just complaining over coffee, why not just demand a 40% salary increase?” Now, I’m not a financial expert, but asking for almost half your salary in one go is about as realistic as me asking for a full refund for my Netflix subscription after they canceled my favorite show! So here we are, one month into a strike that’s halted production like a cat at a dog show.
The Cost of Grounding
And what’s the cost of this little rebellion? A staggering $100 million per day! That’s right—in just about a month, they’ve managed to drain a cash register that would make Scrooge McDuck weep! The only thing left flying around Boeing will be IRS notices, because it seems they might need to perform a few aerial acrobatics to avoid a financial nosedive.
Not surprisingly, the axe has fallen, with Boeing announcing a whopping 17,000 layoffs faster than you can say “Layoff Party!” But don’t worry, Boeing assures us that Chapter 11 might just be a slight detour on their route to recovery, like taking a scenic route while driving your bus directly into a lake.
Emirates’ CEO: Drowning in Worry
Emirates CEO Tim Clark, bless him, seems to think that without capital injection through a rights issue, we might see Boeing’s credit rating downgraded to Junk status. It’s like Mrs. Brown’s boys sitting down to discuss fashion sense—irrelevant yet intriguing; you can’t help but watch!
A Fragile Future
Rumor has it, Boeing is plotting to raise a cool $10 billion through said rights issue. That’s right: in a world where everything is about sustainability, they’re planning to recycle some cash! And as for Moody’s, they’re considering an upgrade—an upgrade to “Junk” status. That’s the kind of gold star you don’t want to hang on your fridge!
Largest Customer Woes
But wait, there’s more! Emirates, Boeing’s largest widebody customer, is sitting on a mountain of orders, including a staggering 205 aircraft from the new 777X family and 35 787s. Talk about commitment! Recently, Boeing pushed back the delivery of the first 777-9 to 2026. At this rate, they might as well just tell Emirates, “Your plane is in another castle.” Princess Peach would approve.
The Bottom Line
So, what have we learned today? Keep your eye on Boeing, folks! It’s like watching a train wreck—you know you shouldn’t, but it’s impossible to look away. As employees shuffle back to their desks and Boeing attempts to raise funds while avoiding the equivalent of taking a financial plunge, let’s hope this aviation titan can keep its wings level and navigate the storm.
Who knows, they might just turn this comedy of errors into a heroic comeback worthy of a Hollywood blockbuster.
Until next time, remember: when you fly with Boeing, it’s always best to expect turbulence, both in the air and in the accounts!
