In a letter seen by Reuters, the Chief Executive (CEO) of Boeing Co. or Boeing, Dave Calhoun told employees that the airplane manufacturing company would resume its commercial airplane production next week in the state of Washington next week. The company, which suspended its operations last month due to the emergency lockdown prompted by the coronavirus pandemic, aimed to seek a rescue financial assistance from the US government.
Reopening of Boeing’s Productions
It was reported that Calhoun told nearly 27,000 employees that the Puget Sound area of Washington would be returning to production of the 747, 767, 777, and 787 jet programs and the company’s workers were told to start reporting from April 20 for all except for the 787 programs.
Meanwhile, the CEO claimed, “Our industry will need the government’s support, which will be critical to ensuring access to credit markets and likely take the form of loans versus outright grants.” He further added, “Our team continues to focus on the best ways to keep liquidity flowing through our business and to our supply chain until our customers are buying airplanes again.”
Since January, Boeing’s productions of the 737 Max had been put on hold after two fatal crashes happened in five months and all of the 737 Max models were grounded due to the restraining order imposed by the aviation regulators. Meanwhile, it is likely that employees would return to work for the 737 programs in Puget Sound from April 20 as they resume working toward restarting MAX production.
Seeking Rescue Package from the US Government
Last month, the ailing airline company sought to “ensure a minimum of $60 billion in access to public and private liquidity, including loan guarantees, for the aerospace manufacturing industry” from the US government. However, Calhoun said in March that the company had no intention from the US Treasury to take an equity stake as a condition of government loans.
At the same time, US President Donald Trump has earlier made a pledge to help Boeing on several occasions as he said last week, “Boeing has not asked for aid yet but I think they probably will… We can’t let anything happen to Boeing.” Considering the prospect of Trump’s statement, Boeing hired investment banks Lazard and Evercore Inc. last week to advise on the potential US government assistance or private-sector loans.
Calhoun recalled that US Treasury and 10 airlines had agreed on relief package worth nearly $25 billion to fight the virus downturn of the aviation industry in the US and help the airlines’ companies to save from collapsing. Calhoun explained, “Knowing that the U.S. airline industry has critical financial support through this devastating wave of the virus allows us to plan our production system for the medium- and long-term impact on air travel.”
Earlier, Congress has set aside $17 billion in direct loans for national security-related companies due to the pandemic that could allow Boeing to take part in a Treasury-backed Federal Reserve lending program.
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