Southwest Stands With CEO as Board Retirements To Bring New Leadership
Southwest Airlines announced the next phase of its board’s transformation on Tuesday as six directors are slated to retire in…
Report indicates Boeing strike hits 737 deliveries most in Q3.
Boeing has notified employees of a hiring freeze and is considering furloughs in the coming weeks as experts predict significant cash loss for the company this quarter due to an ongoing machinist strike.
Over 30,000 machinists and aerospace workers at the company walked off the job Friday after a large majority of them rejected a tentative contract. A Bloomberg Intelligence analysis predicted Monday that Boeing could be out $3.5 billion in cash in Q3 if the strike continues through September.
According to the Bloomberg report, the cash loss could reduce Boeing’s balances to $9 billion – near the minimum for the company. The largest driver of results in sales will be 737 deliveries, which Boeing will have made 78 of for Q3 versus 70 in Q2. The report stated that defense and Global Services are expected to perform similarly to Q2.
Boeing’s finance chief Brian West told employees in an emailed memo that the company would take actions to preserve its cash, including:
“… [W]e are planning to make significant reductions in supplier expenditures and will stop issuing the majority of supplier purchase orders on the 737, 767 and 777 programs,” West said in the memo. “We are also considering the difficult step of temporary furloughs for many employees, managers and executives in the coming weeks.”
Bloomberg Intelligence stated that airlines most affected by Boeing’s strike will be Ryanair, Southwest, United, and Alaska. While it’s not in the high-demand season, this is expected to predominantly affect U.S. air travel.
The report stated that the most-affected airlines in the near term appear to be Southwest, Alaska, Aeromexico, and Jin Air of Korea, all of which are expecting two deliveries in the remaining half of September. With vacation season waning in the U.S., Bloomberg estimates a minimized impact from delays.
Caleb Revill is a journalist, writer and lifelong learner working as a Junior Writer for Firecrown. When he isn't tackling breaking news, Caleb is on the lookout for fascinating feature stories. Every person has a story to tell, and Caleb wants to help share them! He can be contacted by email anytime at [email protected].
View all postsReceive a daily dose of the airline industry's top stories along with market insights right in your inbox.
Southwest Airlines announced the next phase of its board’s transformation on Tuesday as six directors are slated to retire in…
The U.S. Department of Transportation (DOT) has launched a federal inquiry into the four largest U.S. airlines’ rewards programs in…
Elliott Investment Management now owns 10% of Southwest’s common stock and can call a special meeting at the carrier, according…
Receive a daily dose of the airline industry's top stories along with market insights right in your inbox.