Air Force gives Boeing nearly $900 million to weather crisis
Cash is king right now, especially for companies like Boeing, which are looking for ways to stay liquid to weather this economic storm. The Air Force has stepped in to help, despite the continuing problems with a line of K-46 refueling tankers built by the company.
To that end, the Air Force is going to give Boeing nearly $900 million to help ensure that the major defense contractor will survive this global economic crisis.
Now, this isn’t a gift. Rather, it’s money that Boeing is actually owed, but the Air Force has withheld because of problems with the KC-46. The Air Force has held back about $28-million on each of the 33 refuelers delivered so far.
The tanker, which is a modified 767, has experienced a series of problems from debris left on board to refueling leaks revealed this last week, in addition to a long-term problem with the on-board camera system used to direct the refueling booms.
This infusion of cash comes on the same day that the Air Force and Boeing have come to a new agreement on fixing that camera system. Boeing said the freeing-up of cash isn’t related.
The Seattle Times reported the company hopes to have the final camera fix in operation in 2023. It will use a quick software fix to be in use by 2021. This agreement will allow the Air Force to use the tankers on actual refueling missions. Right now, they are only be used to move cargo.