Reportedly the pandemic is taking its toll on aerospace manufacturing, as Boeing Co (BA.N) announced it would halt production of most widebody jets and Airbus SE restarted only partial output after a four-day shutdown as suppliers cut jobs. With airlines unable to fly because of a collapse of demand over fears of contagion, reinforced by air travel restrictions, planemakers and their suppliers are under pressure to save cash to ride out a squeeze on liquidity.
Moody’s cut its outlook for the aerospace and defence industry to negative from stable and warned that even when markets recover, the damaged balance sheets of most airlines would hurt demand for new aircraft. Global passenger capacity fell by 35% last week, the worst since the start of the crisis, according to data from airline schedules firm OAG, which said deeper cuts were likely in the coming weeks.
Boeing faces the shutdown of key assembly lines for the second time in a year after being forced to halt production of its grounded 737 MAX aircraft in January. Production of long-haul jets like the 787 and 777 in Washington state will pause for 14 days starting wednesday, forcing the world’s largest industrial building, the giant Boeing wide-body plant at Everett north of Seattle, to fall silent for the first time in recent memory.