On Tuesday, Boeing Co called for a $60 billion loan rescue for the struggling U.S. aerospace manufacturing industry, which is currently being clobbered by the coronavirus.
Boeing requested House of Representatives officials for short-term support for themselves, suppliers and airlines as the travel industry outlook worsens by the day due to the pandemic, said people familiar with the matter.
Cash has already started to be saved by the largest U.S. aircraft supplier as airlines postpone jet deliveries in the midst of a downturn in travel demand as the 737 Max is still grounded. Last week, Boeing started to suspend new hires, restrict overtime and curb some expenditure.
Reuters first announced that Boeing was searching for "ten trillion of dollars" in U.S. government loan guarantees and other assistance as it faces a potential liquidity crisis due to the effect of the outbreak on In the aviation industry, two people briefed Reuters on the matter.
The U.S. planemaker is trying to prevent layoffs and disruption to hundreds of smaller companies that make parts and systems for their aircraft, sources said, who asked not to be identified because of the talks were private.
Boeing was also buffeted by the grounding of its best-selling 737 Max which is waiting for regulatory approval to resume flights after two deadly crashes.
The emergency funds will help the wider aviation industry's health as a big portion of Boeing's liquidity funding would be used to pay suppliers to sustain the supply chain's health, the company disclosed in a statement late Tuesday.
Boeing spokesperson Gordon Johndroe said the airline supports at least $60 billion in access to public and private liquidity, and that includes bond guarantees for the aviation industry.
A senior official in the administration said the White House was in communication with Boeing about the virus. President Donald Trump stated last week the U.S. the government should "100 percent support the airlines" - a point he then reinforced in a tweet.
A trade organization, Airlines for America, said passenger carriers needed $50 billion in funding, plus an additional $8 billion for air freight companies.
Meanwhile, shares pared earlier losses to close down on the stock market by 4.2 percent 124.14, touching the lowest point since July 2016 and more than wiping out gains since Trump's November 2016 surprise victory. Boeing stock fell another 9.5 percent after closing.
Top Boeing 737 Max supplier Spirit AeroSystems dropped 10.6 percent, while engine supplier General Electric retreated sharply to 6.5 percent.
