Boeing Warns on Cash Burn, Awaits Strike Vote

Boeing Warns on Cash Burn, Awaits Strike Vote

In what could hardly be called a vote of confidence, Boeing shares fell 6.3% in premarket trading Wednesday after the planemaker cautioned investors of a "significant" cash burn in the second quarter. On top of that, Boeing is still awaiting a crucial strike vote from its machinists union.

Boeing's Cash Burn

In a regulatory filing Tuesday, Boeing said it expects to burn through between $2.5 billion and $3 billion in cash during the quarter ending June 30. This is a significant increase from the $1.2 billion it burned through in the first quarter. The cash burn is being driven by a number of factors, including the ongoing grounding of the 737 MAX, the impact of the COVID-19 pandemic on air travel, and the company's decision to increase production of the 787 Dreamliner.

Machinists Union Strike Vote

Boeing is also facing a potential strike by its machinists union. The union, which represents about 27,000 workers, is scheduled to vote on a new contract offer from Boeing on Wednesday. If the union rejects the offer, it could lead to a strike as early as next week. A strike would be a major blow to Boeing, which is already struggling with the grounding of the 737 MAX and the impact of the COVID-19 pandemic. A strike could further delay the return of the 737 MAX to service and disrupt production of other Boeing aircraft.

What's Next for Boeing?

Boeing is facing a number of challenges, but it is also taking steps to address them. The company is working to get the 737 MAX back in the air, it is increasing production of the 787 Dreamliner, and it is working to negotiate a new contract with its machinists union. It remains to be seen whether Boeing will be able to overcome these challenges, but the company is taking steps to address them. The outcome of the machinists union strike vote will be a key factor in determining Boeing's future.

Sources

* [Boeing Warns on Cash Burn, Awaits Strike Vote](https://www.nytimes.com/2020/06/30/business/boeing-cash-burn-strike-vote.html) * [Boeing shares fall 6.3% premarket after warning on cash burn](https://www.cnbc.com/2020/06/30/boeing-shares-fall-6point3percent-after-warning-on-cash-burn.html) * [Boeing Machinists Union to Vote on New Contract Offer](https://www.seattletimes.com/business/boeing-aerospace/boeing-machinists-union-to-vote-on-new-contract-offer/)