Why Shares of Boeing Are Falling Today
Shares of Boeing (NYSE: BA) fell 9% on Wednesday morning on reports the company is planning a full drawdown of a $13.8 billion loan it secured last month. Even if the move is only precautionary, it speaks to the precarious situation Boeing finds itself in as global travel wanes due to COVID-19 coronavirus fears.
Boeing's massive commercial aerospace unit has been a cash cow for the company for more than a decade, but troubles were surfacing well before the coronavirus outbreak rattled investors. The company's much-anticipated 737 MAX has been grounded for a year now following the crashes of two of the planes that killed all on board.
The MAX is expected to return to the skies by the second half of this year, but demand for the plane is no longer as certain as it once was. Outbreak concerns have caused demand for air travel to plummet, leading at least one prominent Boeing and 737 MAX customer, Southwest Airlines, to hint that it could defer deliveries of the jet if it doesn't see an uptick.
Source Fool.com
