Boeing Plans To Sell Off Major Assets As The Company Scrambles To Remain Profitable And Stay Competitive In A Tough Market
Boeing has been making bold moves lately, trying to stay above water in a market that’s becoming more unforgiving. The aerospace giant, which has faced several blows recently, is reportedly considering selling off key assets to shore up its finances.
According to the Wall Street Journal, Boeing is considering divesting from noncore or underperforming units. The latest deal involves a small defense unit that produces surveillance gear for the U.S. military. Insiders say this is just one of many cuts in the works.
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This is not a walk in the park. Selling off parts of the company might be risky, but for Boeing, it’s a roll of the dice they seem to have no choice but to make. The company has been hit with a string of crises this year, starting when a 737 MAX had a door panel blow off midflight back in January.
That incident set the tone for a year full of turbulence, from increased regulatory scrutiny to significant slowdowns in production. Things got so bad that the company’s CEO stepped down. Kelly Ortberg, who has since taken the reins, now faces the daunting task of guiding Boeing through the storm.
This isn’t all Boeing’s dealing with. Labor unrest has thrown yet another wrench in the works. In September, around 33,000 unionized workers went on strike, halting production and throwing Boeing’s already shaky finances into even deeper trouble.
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The strike completely froze output for key models like the 737 MAX, 767 and 777 widebody jets and now Boeing is facing one more headache it didn’t need. A new contract with Machinists is up for a vote, promising a hefty 35% pay bump over four years. But even if it passes, Boeing’s bottom-line damage might already be too severe to ignore.
Meanwhile, Boeing’s board has been scrambling to find a way out of this mess. They recently met to determine which divisions are worth keeping, reviewing financial reports and grilling division heads.
The Wall Street Journal notes these internal talks are critical as Boeing looks to downsize and pivot. Will it be enough? That’s the million-dollar question, especially with regulatory investigations into the company’s safety practices still in full swing.
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