LOCAL NEWS

Boeing execs try to calm investors after multi-billion dollar loss

Nov 2, 2022, 12:25 PM | Updated: 1:20 pm
The logo for Boeing appears on a screen above a trading post on the floor of the New York Stock Exc...
The logo for Boeing appears on a screen above a trading post on the floor of the New York Stock Exchange, Tuesday, July 13, 2021. Boeing reported a $3.3 billion loss for the third quarter Wednesday, Oct. 26, 2022, as revenue fell short of expectations, it took a huge losses for fixed-cost defense programs and its commercial-airplane business struggled. (AP Photo/Richard Drew, file)
(AP Photo/Richard Drew, file)

Boeing posted a multi-billion dollar loss in the third quarter of this year. Now, the company is trying to rebound and move back into positive territory.

The plane manufacturer has thousands of jobs based in Washington and the Puget Sound region. This morning, company executives tried to sell investors on a new course for Boeing.

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They discussed the plan during the company’s investor conference Wednesday morning — it’s the first such conference since 2016.

Boeing has faced production delays and issues with certain contracts including defense contracts, and that has spooked some investors who maybe are looking to see what, if anything, Boeing can do to come out of this.

Boeing President and CEO Dave Calhoun was the first in a long line of executives to speak this morning.

The executives fully admitted that the COVID-19 pandemic and the grounding of its top-selling plane — the 737 MAX — after two deadly crashes had created major issues. The company has racked up debt and taken losses in some of its business sectors as a result.

Boeing executives said the company will try to ramp up production in the coming years — production that waned due to factory shutdowns during the COVID-19 pandemic. It also wants to get back to a stable delivery timetable.

The company says it will deliver 400-450 737s next year and deliver about 70-80 787s. Company executives said Boeing is hoping to get certification for the 737 MAX later this year or early next year.

Calhoun stressed that safety now dominates Boeing’s efforts.

He said the groundings and the subsequent efforts toward building a safer 737 MAX have informed all decisions going forward.

“We’ll never forget it nor should we ever forget it, and all the work we do around safety, which has been the dominant theme in our company during this whole period of time,” said Calhoun. “All the work we do around safety is built around that promise.

The company has stressed that its free cash flow has been strong and executives this morning said that Boeing believes there will be even higher free cash flow in the coming year.

A lot of that is due to jet deliveries that could ramp up through 2023.

For perspective, one executive said that manufacturing of the 737 could go from roughly 30-35 planes a month for the first six months to 40-45 planes a month in the latter half of 2023.

Boeing is projecting that more jet deliveries could generate about $3 billion to $5 billion in cash flow in 2023. That’s far higher than the roughly $1.5 billion to $2 billion range that could come through this year.

Chief Financial Officer Brian West made Boeing’s situation plain while speaking at the conference saying, “The playbook for us is very straightforward; deliver planes, generate cash, pay down debt.”

Calhoun had echoed those sentiments earlier, saying that the company does want to be transparent about its goals and wants to make promises for goals that it can actually reach.

Boeing said it was working on research for autonomous planes but stressed that such planes and their cutting-edge technology might not materialize until the 2030s.

After its third quarter earnings report, the company said it may not be back to pre-pandemic production levels until 2025-2026, a time frame that was echoed during this morning’s investor conference.

Follow this link to read additional stories from KIRO 7

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Boeing execs try to calm investors after multi-billion dollar loss