Boeing obtains a $1.5 billion line of credit, citing financial uncertainty. The move comes during a worldwide grounding of the company's 737 Max airplane following two deadly crashes.
A partially completed Boeing 737 Max airplane is pictured at the Boeing manufacturing facility in Renton, Wash., in 2015. By Douglas MacMillan Douglas MacMillan Reporter covering corporate accountability Email Bio Follow April 29 at 10:03 PM Boeing has secured a $1.5 billion line of additional credit, a sign the plane maker is taking more caution with finances as sales of the 737 Max remain on hold.
Boeing’s business requires a large amount of cash to produce new planes and invest in operations, and its ability to generate cash has been stifled by the worldwide grounding of the 737 Max. The company continues to produce 42 new 737 jets a month, but cannot sell any 737 Max planes to customers until global regulators are satisfied that Boeing has improved their safety.
In a statement, Boeing spokesman Gordon Johndroe said the added line of credit “provides adequate financial flexibility to address financial market uncertainty, emerging business needs, as well as take advantage of potential strategic business opportunities should they arise.” Last week, Boeing said it paused its plan to buy back $18 billion in stock from investors, a move that freed up more cash to use in the business. Boeing also took the unusual step of withdrawing its guidance, or estimate of future financial results, because it doesn’t know how many planes it could sell this year.
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