Fitch: Boeing Has Limited Rating Headroom for Prolonged Strike

By Josh Beckerman

Fitch Ratings said a strike lasting a week or two would be unlikely to pressure Boeing's investment-grade BBB- credit rating, but added the rating has limited headroom for an extended strike.

Thousands of Boeing machinists went on strike after midnight Pacific time on Friday.

Fitch said a strike of similar length and operational impact to a 57-day strike in 2008 could "result in a negative rating action without the addition of new liquidity in a credit-conscious manner."

Fitch added that its ratings-case forecasts don't assume operationally disruptive labor action, but do account for union-related labor-cost increases under new contracts.

Meanwhile, Moody's Ratings placed Boeing's ratings on review for downgrade, including the Baa3 senior unsecured rating and P-3 commercial paper rating.

"In our review, we will assess the strike's duration and impact on cash flow and the potential equity capital raising Boeing may undertake to bolster its liquidity," Moody's said.

Write to Josh Beckerman at josh.beckerman@wsj.com

(END) Dow Jones Newswires

September 13, 2024 13:46 ET (17:46 GMT)

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