Boeing suspends dividend, CEO foregoes pay after
coronavirus-related aid request
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[March 21, 2020] By
Eric M. Johnson
SEATTLE (Reuters) - Boeing Co <BA.N> will
cancel CEO pay, suspend its dividend and extend a pause on share
buybacks, the U.S. planemaker said on Friday, as companies eager for
government aid to curb fallout from the coronavirus face pressure to cut
payouts to investors.
Boeing's decision echoes similar measures taken by the largest U.S.
airlines in an effort to win over taxpayer support for their requests
for stimulus packages, as the fast-spreading virus virtually erases air
travel demand and hits the global economy.
Boeing has said it wants at least $60 billion in U.S. government loan
guarantees for itself and to help prop up a U.S. aerospace manufacturing
supply chain already reeling from the year-old grounding of its
previously fast-selling 737 MAX jetliner after fatal crashes.
"Boeing is drawing on all of its resources to sustain operations,
support its workforce and customers, and maintain supply chain
continuity through the COVID-19 crisis and for the long term," the
company said late on Friday.
Democrats and some Republicans have been insisting on limits on
executive compensation, buybacks and dividends as part of any government
On Friday, U.S. President Donald Trump said he would demand limits on
any company receiving assistance.
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The Boeing logo is displayed on a screen, at the New York Stock
Exchange (NYSE) in New York, U.S., August 7, 2019. REUTERS/Brendan
McDermid -/File Photo
"When we did a big tax cut, and when they took the money and did buybacks,
that's not building a hangar, that's not buying aircraft, that is not doing the
kind of things that I want them to do," Trump said.
"I am fine with restricting buybacks - in fact I would demand that there be no
stock buybacks. I don't want them taking hundreds of millions of dollars and
buying back their stock because that does nothing."
Boeing, which suspended its stock buyback program in April 2019 in the middle of
the 737 MAX crisis, said it will extend its pause of any share repurchasing
"until further notice."
On Thursday, Boeing said former United Nations ambassador Nikki Haley had
resigned from its board after opposing its bid for government financial
"I cannot support a move to lean on the federal government for a stimulus or
bailout that prioritizes our company over others and relies on taxpayers to
guarantee our financial position," Haley said in a letter to the company's
management released by Boeing on Thursday.
(Reporting by Eric M. Johnson in Seattle; Additional reporting by Tracy Rucinski
in Chicago and David Shepardson in Washington; Editing by Cynthia Osterman and
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