Boeing has confirmed that to assist with its request for government aid to aid both itself and other manufacturers in the aerospace supply chain, it will suspend paying any dividends, the company CEO will forego his salary, and the current embargo on share buybacks will remain in place, indefinitely.
Like many companies in the aerospace sector, Boeing has been badly hit by the widespread economic effect of the COVD-19 outbreak and government aid will be critical to the survival of many. Boeing has been especially hard hit as it has been dealing with the fallout from the grounding of the 737 MAX nearly a year ago after two fatal crashes.
“Boeing is drawing on all of its resources to sustain operations, support its workforce and customers, and maintain supply chain continuity through the COVID-19 crisis and for the long term,” the company said late on Friday. Both Democrats and Republicans have made it clear that government aid should be subject to limitations on executive compensation, buybacks and dividends.
According to Reuters news agency, U.S. President Donald Trump said he would demand limits on any company receiving assistance. “When we did a big tax cut, and when they took the money and did buybacks, that’s not building a hangar, that’s not buying aircraft, that is not doing the kind of things that I want them to do,” Trump said.
Boeing also announced at the end of last week that former United Nations ambassador Nikki Haley had resigned from its board after opposing its bid for government financial assistance. “I cannot support a move to lean on the federal government for a stimulus or bailout that prioritizes our company over others and relies on taxpayers to guarantee our financial position,” Haley said in a letter to the company’s management released by Boeing on Thursday.
