S&P places Boeing ratings on CreditWatch negative

S&P Global Ratings stated: “The strike by Boeing Co.’s machinist union is in its fourth week, increasing financial risk for the company. We estimate the company will incur a cash outflow of approximately $10 billion in 2024, due in part to working capital buildup to support manufacturing process overhaul and costs associated with the strike. We believe the company will likely require incremental funding to maintain its target cash balance, fund operating and working capital, and meet debt maturities. Therefore, we placed the ratings on Boeing, including the ‘BBB-‘ issuer credit rating and senior unsecured debt ratings, on CreditWatch with negative implications. We are also placing our ‘A-3’ short-term and commercial paper ratings on CreditWatch with negative implications. The CreditWatch listing reflects the increased likelihood of a downgrade if the strike persists toward the end of the year, further constraining the recovery in the company’s cash flow generation and the company does not raise capital sufficient to meet its upcoming needs in such a way that does not increase financial leverage.”