Shares of Boeing Co. fell below $200 for the first
time since mid-2017, closing at $189.08. They
have plunged 58% in just over a year.
The latest drop occurred after Bloomberg News
reported that Boeing will soon draw down the
last of a $13.8 billion bank loan it arranged a
little over a month ago. The company has been
burning through cash since halting deliveries of
the 737 Max last spring, and it is unclear when
regulators will let the grounded plane fly again.
“The year ahead is shaping up to be as
challenging for our business as any in the recent
past,” CEO David Calhoun and Chief Financial
Officer Greg Smith said in a note to employees.
“On top of the work of safely returning the 737
MAX to service and the financial impact of the
pause in MAX production, we’re now facing a
global economic disruption generated by the
COVID-19 coronavirus.”
The warning about 2020 is a strong statement
considering that Boeing is facing its biggest
crisis in decades after two deadly crashes
involving Max jets and just posted its first full-
year loss since 1997.
Indeed, 2020 is off to an ominous start
for Boeing. It reported no orders for new
commercial planes in January while rival Airbus
racked up 274 orders. Boeing’s 18 orders in
February were all for so-called widebody or
twin-aisles jets — larger planes that are typically
used for long flights.
Through Feb. 29 Boeing has reported a loss of 43
orders for the Max, as customers switched those
orders to other models. For example, Air Lease
Corp., which leases planes to airlines, swapped
9 Max orders for three larger 787 jets, and Oman
Air converted 10 Maxes into four 787s.