Queso wrote:You have to be thinking about the financial side of this as well... If the airlines aren't taking delivery, they likely aren't making lease/purchase payments, leasing companies aren't receiving lease payments and aren't making purchase payments, Boeing still has to make payments on the materials they are using to build the planes, the transportation getting them to final assembly, they still have to pay their employees, they still have to pay for electricity and other utilities, rent, taxes, etc...
This has to be a HUGE cash flow problem for them, even as capitalized as they may be. How long can this go on? It's not like not getting paid during development and testing of 3 or 4 new planes, we're potentially talking about 100+ airliners sitting around not making money before there's any foreseeable money coming in for them.
Edit: And that's not even considering any penalty payments for planes already delivered not being able to be in service.
Zak wrote:I obviously don't have any figures at hand, but I don't think cash flow will be an issue for Boeing. Few companies will find it easier to get more cash when they need it. With market interest rates being as low as they still are, it won't even cost Boeing a lot of money.
To put things into perspective, Boeing shares are still higher than the day before the Lion Air crash.
Boeing will be able to cope with the short-term fallout of the MAX situation. For me, the more interesting part is the awkward decision-making processes that the whole situation unveiled.
It bears some resemblance to the current situation German car makers are in. It doesn't matter for how long you've been a champion in your market. When your decision makers begin to fail (usually a result of hubris and greed), your company is heading into a dangerous direction.
It will be interesting to see if Boeing really learned a lesson here.
Boeing looking to borrow $10 billion: reports
As the groundings of the 737 MAX continue and cash reserves are draining at Boeing due to the fact that production is still running on other aircraft programs, the company is reportedly seeking to borrow $10 billion or more, according to reports by Reuters, citing sources close to the matter.
Just before the company announced its Q2 2019 financial results in July 2019, it took a $4.9 billion charge, citing “potential concessions and other considerations to customers for disruptions related to the 737 MAX grounding and associated delivery delays.” However, more unhappy customers are lining up to claim compensation from the manufacturer due to the prolonged grounding, including American Airlines and Southwest Airlines, two long-standing customers of Boeing.
Queso wrote:Ummm hmmm... Just as I thought. Back in "Ethiopian B737 MAX 8 Crashes On Departure" thread on April 8, 2019...Queso wrote:You have to be thinking about the financial side of this as well... If the airlines aren't taking delivery, they likely aren't making lease/purchase payments, leasing companies aren't receiving lease payments and aren't making purchase payments, Boeing still has to make payments on the materials they are using to build the planes, the transportation getting them to final assembly, they still have to pay their employees, they still have to pay for electricity and other utilities, rent, taxes, etc...
This has to be a HUGE cash flow problem for them, even as capitalized as they may be. How long can this go on? It's not like not getting paid during development and testing of 3 or 4 new planes, we're potentially talking about 100+ airliners sitting around not making money before there's any foreseeable money coming in for them.
Edit: And that's not even considering any penalty payments for planes already delivered not being able to be in service.Zak wrote:I obviously don't have any figures at hand, but I don't think cash flow will be an issue for Boeing. Few companies will find it easier to get more cash when they need it. With market interest rates being as low as they still are, it won't even cost Boeing a lot of money.
To put things into perspective, Boeing shares are still higher than the day before the Lion Air crash.
Boeing will be able to cope with the short-term fallout of the MAX situation. For me, the more interesting part is the awkward decision-making processes that the whole situation unveiled.
It bears some resemblance to the current situation German car makers are in. It doesn't matter for how long you've been a champion in your market. When your decision makers begin to fail (usually a result of hubris and greed), your company is heading into a dangerous direction.
It will be interesting to see if Boeing really learned a lesson here.
And now? https://www.aerotime.aero/rytis.beresne ... rrow-moneyBoeing looking to borrow $10 billion: reports
As the groundings of the 737 MAX continue and cash reserves are draining at Boeing due to the fact that production is still running on other aircraft programs, the company is reportedly seeking to borrow $10 billion or more, according to reports by Reuters, citing sources close to the matter.
Just before the company announced its Q2 2019 financial results in July 2019, it took a $4.9 billion charge, citing “potential concessions and other considerations to customers for disruptions related to the 737 MAX grounding and associated delivery delays.” However, more unhappy customers are lining up to claim compensation from the manufacturer due to the prolonged grounding, including American Airlines and Southwest Airlines, two long-standing customers of Boeing.
Boeing's crisis-hit 737 Max jetliner faces a new potential safety issue as debris has been found in the fuel tanks of several new planes which were in storage, awaiting delivery to airlines.
The head of Boeing's 737 programme has told employees that the discovery was "absolutely unacceptable".
A Boeing spokesman said the company did not see the issue further delaying the jet's return to service.
ShanwickOceanic wrote:And the hits just keep onnn comin'...
