Apr 30, 2020 - Economy

Boeing declines government funding after raising $25B in bond deal

Orion Rummler

A factory where Boeing manufactures the 737 MAX airplane on April 29 in Renton, Washington. Photo: Stephen Brashear/Getty Images

Boeing does not expect to seek aid from the federal government to offset losses exacerbated by the coronavirus crisis, after selling $25 billion in bonds in the public market, the company said in a Thursday press release.

Flashback: Boeing sought $60 billion in federal aid for the aircraft industry, including suppliers, in March. The Treasury Department had set aside up to $17 billion for Boeing as part of its $2 trillion CARES rescue package, the Wall Street Journal reported earlier this month.

Boeing said Wednesday it would cut 10% of its workforce as the airline industry as a whole reels from dwindling air travel amid the pandemic.

Details: The company's seven-part bond offering, which WSJ reports is "one of the largest-ever," includes maturities ranging from three to 40 years.

Background: Boeing's production shutdown in the aftermath of two fatal crashes last year had already caused forecasts for the company's GDP this year to shrink.

Thought bubble from Axios’ Joann Muller: The huge bond deal is a vote of confidence in Boeing’s staying power, despite the uncertainty caused by the pandemic. Accepting federal aid would have been controversial, as Boeing already faced financial difficulties because of the grounding of its best-selling plane, the 737 Max, prior to the pandemic. CEO David Calhoun also balked at the idea of giving the U.S. Treasury a stake in the company.

Go deeper: Coronavirus threatens to further delay return of Boeing's 737 MAX

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Boeing declines government funding after raising $25B in bond deal

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