Boeing has been making bold moves lately in an effort to stay above water in an increasingly cutthroat market. The aerospace giant, which has taken several hits recently, is reportedly considering selling key assets to shore up its finances.
According to the Wall Street Journal, Boeing is considering divesting non-core assets or underperforming parts. The latest deal involves a small defense unit that produces surveillance equipment for the US military. Insiders say this is just one of many cuts in the pipeline.
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This is no walk in the park. Selling parts of the company can be risky, but for Boeing it’s a gamble they seem to have no choice but to make. The company has been hit by a series of crises this year, starting when a door panel was blown off in flight from a 737 MAX in January.
That incident set the tone for a year of turbulence, from increased regulatory scrutiny to significant production delays. Things got so bad that the company’s CEO resigned. Kelly Ortberg, who has since taken the reins, now faces the daunting task of steering Boeing through the storm.
This isn’t the only thing Boeing is dealing with. The labor unrest has once again thrown a spanner in the works. In September, about 33,000 union workers went on strike, shutting down production and further diluting Boeing’s already shaky finances.
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The strike completely froze production of key models like the 737 MAX, 767 and 777 widebody jets, and now Boeing is facing yet another headache it didn’t need. A new contract with train drivers is being voted on, which promises a significant pay increase of 35% over four years. But even if the crisis passes, Boeing’s ultimate damage could be too serious to ignore.
Meanwhile, Boeing’s board is trying to find a way out of this mess. They recently met to determine which divisions are worth keeping, reviewing financial reports and scrutinizing department heads.
The Wall Street Journal notes that these internal conversations are critical as Boeing looks to downsize and turn around. Will it be enough? That’s the million-dollar question, especially with regulators’ investigations into the company’s safety practices still ongoing.
