Boeing enters US$10 billion credit agreement with banks
BOEING said on Tuesday (Oct 15) it has entered a credit agreement worth US$10 billion with a consortium of banks, as the US planemaker readies financing sources amid a crippling strike and upcoming debt maturities.
The latest development signals that the planemaker is diversifying its financing options as it has US$11.5 billion of debt maturing through Feb 1, 2026.
Earlier this year, Boeing committed to issuing US$4.7 billion of its shares to acquire Spirit AeroSystems and assume its debt.
Boeing’s cash woes have worsened since roughly 33,000 of its workers represented by the Machinists union walked off their jobs in September, halting production of its best-selling 737 MAX aircraft.
The strike is costing the company more than US$1 billion per month, according to one estimate that was released before Boeing announced it will cut 17,000 jobs or 10 per cent of its global workforce.
The planemaker was already reeling due to a regulator-imposed cap on production of its MAX jets after a mid-air cabin-panel blowout in January.
Boeing has posted operating cash flow losses of more than US$7 billion for the first half of 2024 and had about US$60 billion in debt, including the US$10 billion it raised earlier this year. REUTERS
