Janice R. Andrews
S&P, a leading global ratings agency, has placed Boeing’s credit rating under negative review due to an ongoing labor dispute. Approximately 33,000 workers are currently on strike, bringing production of Boeing’s best-selling aircraft to a standstill and exerting significant financial pressure on the company.
The ratings agency projects that Boeing could experience a cash outflow of around $10 billion in 2024. S&P cautions that if the strike persists until year-end, Boeing might need to secure additional funding to meet its financial commitments, raising concerns about the company’s liquidity position.
The prolonged nature of the strike increases the possibility of a credit rating downgrade, which could further impact Boeing’s financial health. Such a downgrade would likely result in higher borrowing costs and potentially hinder the company’s ability to obtain favorable financing terms.
The labor dispute has already substantially disrupted Boeing’s operations, prompting S&P to take action amid the uncertainty surrounding its resolution. As the strike continues, the global aerospace industry is closely monitoring Boeing’s strategies to alleviate the financial strain.
The upcoming weeks will be critical for Boeing as it works to resolve the labor conflict and manage its potential impacts on both production capabilities and overall financial standing.
