By Andrew Tangel and Doug Cameron 

Boeing Co. is set to emerge as a big winner of the coronavirus stimulus package, even if the aerospace giant declines to seek direct taxpayer help.

The company had lobbied for at least $60 billion for itself and its vast supplier network to blunt the blow of the pandemic that has paralyzed global airline travel and reduced demand for passenger aircraft.

The prospect of canceled orders and airlines unable to take new planes added to the pressure on Boeing from the continuing crisis around the grounding since last year of its 737 MAX jets, which has already sent its debt soaring as it borrowed to compensate customers and support suppliers.

The $2 trillion stimulus bill approved by Congress includes much of what it wanted: billions of dollars available for it and its supply chain, and billions more to its struggling airline customers to stay in business.

"It's important that the supply chain gets relief," said Eric Fanning, chief executive of the Aerospace Industries Association, a trade group that counts Boeing among its members. "The most effective way to inject support is through its customers."

Whether Boeing will tap into stimulus money directly remains to be seen.

Lawmakers set aside $17 billion in loans and loan guarantees directed at companies deemed essential to national security. Congressional officials and a senior U.S. aviation industry executive said the carve-out was partly aimed at Boeing.

Tapping that $17 billion pot would come with strings that Boeing Chief Executive David Calhoun has rejected. In particular, the loans would come with a condition that the U.S. government take an equity stake or warrants for shares in loan recipients. The government could instead take a senior debt position in recipients.

"Right now, Boeing is saying they don't need it," U.S. Treasury Secretary Steven Mnuchin said Friday on Fox Business Network. He added: "I appreciate the fact that Boeing thinks they can operate on their own -- that's what we want them to do."

Earlier this week, Mr. Calhoun told the television network Boeing would rather secure private financing than give the government an equity stake. "If they forced it, we'd just look at all the other options, and we have got plenty," he said.

Mr. Calhoun said this week that Boeing had $15 billion in cash, and it still has access to a $9.6 billion loan facility.

A Boeing spokesman said Friday the company was considering all options for government aid, including a share of $454 billion of stimulus funds available to businesses across industries that don't require the government taking an equity stake.

Boeing shares, which had doubled this week, dropped 7% on Friday. Shares in its suppliers and U.S. airlines also fell sharply. The declines reverse gains earlier this week following the Senate's passage of its stimulus plan.

Whatever help Boeing might wind up seeking, President Trump has vowed to protect the Chicago-based manufacturer. It is widely regarded as too important to the nation's economy and national defense for the government to allow it to fail. Boeing is the nation's largest exporter and second-largest defense contractor. It supports thousands of smaller businesses that supply everything from aircraft fuselages and wings to cockpit electronics.

The company has declined to detail the components of the $60 billion it has been seeking. After the Senate passed its stimulus bill late Wednesday, Boeing praised the package, saying its liquidity boost was "critical for airlines, airports, suppliers, and manufacturers to bridge to recovery."

Faced with mounting financial strain, Boeing has suspended its dividend and has been considering potential layoffs. Executives have said they were working to avoid cutting or furloughing employees from its 65,000-worker commercial arm.

Under the proposed stimulus plan, certain loan recipients must maintain at least 90% of their current workforce through Sept. 30, among other worker protections, eliciting praise from the International Association of Machinists and Aerospace Workers, which represents Boeing factory workers in the Seattle area.

--Lindsay Wise and Siobhan Hughes contributed to this article.

Write to Andrew Tangel at and Doug Cameron at


(END) Dow Jones Newswires

March 27, 2020 14:03 ET (18:03 GMT)

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