The Opening Bell is powered by The Water Coolest. You can sign up for TWC's full, daily email newsletter here. In the meantime, check out one of the features from today's edition ...
Boeing announced that it would be halting production at its Washington plants, while GE Aviation sent a number of employees to the chopping block amidst coronavirus concerns.
Boeing for broke
Let’s start with Boeing. Don’t worry, not the 737 Max...yet. The airplane maker announced that it was shutting down production at its Washington state-based plants for more than two weeks after an employee that works there died of coronavirus. Not on-site, but still not a great headline.
The employee worked in Boeing’s Everett, WA plant, and was the first of Boeing’s employees to die of COVID-19, while there are 32 confirmed cases among Boeing personnel. 24 of Boeing’s ‘VID+ employees work near Seattle, and Boeing had previously said that employees that were sick and couldn’t work from home would be given 10 paid days off. For the record, it’s recommended that coronavirus patients self-isolate for at least 14 days, but skirting safety precautions is day 1 sh*t at Boeing.
The planemaker employs more than 70k employees across its Washington plants. The state which was the first to declare a state of emergency, again, if you’re keeping track.
The bright side?
There isn’t much…but Boeing can now make more of a case in its request for a $60B bailout from the federal government. The possibility of a bailout helped its share price rise 11% at the end of the day, despite losing more than 68% on the year. The worst drop of any Dow share...again, if you’re keeping track.
GE-e mister, that sounds bad
GE is right behind Boeing on the list of “Oh Sh*t, What Will They Do Next” Companies. The Google of the 19th century announced it would be laying off 10% of its aviation division, as demand for travel, if you can believe it, has fallen.
GE is taking things one step further, though. It’s reducing executive compensation while furloughing half of its domestic maintenance, repair, and overhaul employees for up to 90 days. According to the bastard child of Thomas Edison, the moves could save between $500M and $1B dollars. Investors’ ears have perked up, no doubt.
Investors will have to wait, however, as shares of GE fell 1% on the news, bringing yearly losses to date to 42%.
The bottom line...
Hey Boeing, people don’t forget. Despite coronavirus, Boeing’s still got that little 737 Max issue to deal with.
One of Boeing’s Washington factories acts as a parking lot for its 737 Max model. The same model that has been grounded for more than a year after two deadly crashes that caused global outrage against one of the US’s largest exporters.
Between the lack of sales and the fact that it’s shutting down two of its largest factories, Boeing’s going to have a lot of work on its hands when it gets back to business. Whenever that might be.
Just a week ago, the company announced it would be rewiring all of the 737 Max models currently in holding, while its friends at the FAA decide how to deal with the more than 800 737 Maxs that have already been delivered. At the time, Boeing still expected to have the planes ready to fly by midyear.
Boeing Temporarily Halts Work at Seattle-Area Factories [Bloomberg]
But wait, there's more. The above is just one feature that appears in today's edition of The Water Coolest's daily email newsletter. Sign up now to get the latest news and commentary delivered to your inbox every weekday at 6 AM EST.