Original link: Boeing’s crisis is getting worse. Now it’s borrowing tens of billions of dollars / CNN.
Boing will borrow 10 B$ from banks and issue new stock for 15 B$ to get capital. The employees are at strike. And the company are planning to layoff 10% of employees.
Not good.
Note that the capital problem is self-inflicted. In the period 2013-2019 Boing made stock buybacks for 43 B$ (and 68 B$ 2010-2024). If Boeing had that money, then they would not need to borrow a dime.
In theory there is nothing wrong with stock buy backs. It is a way to distribute money to stockholders. And in some cases it is unproblematic - Apple has done it and not a problem because Apple is swmming in cash. But in practice it seems to often be a path chosen by badly managed companies to try and keep their stock price up (which may be necessary for executives to receive their bonuses!) even though they do not really have that much excess cash.