Jim Cramer, a prominent financial commentator, has voiced his concerns about Boeing’s financial health in the wake of the company’s announcement to lay off 17,000 employees. This drastic measure comes as Boeing grapples with a multitude of issues, including safety concerns, worker strikes, and production delays.
Cramer, in a recent appearance on CNBC’s ‘Lightning Round,’ expressed his worry, stating, “I’m worried…The balance sheet’s not great, and they should have raised capital when they had a chance to.” He further added, “This was a very jarring series of news tonight, and I don’t have any conviction whatsoever that they are getting this right.”
The layoffs, representing a staggering 10% of Boeing’s workforce, are a stark indication of the company’s current financial reality. The decision comes as Boeing faces a number of challenges. In January, its 737 Max planes were grounded following a mid-flight incident. In July, Boeing admitted guilt in crashes involving the 737 Max in 2018 and 2019, leading to the tragic loss of over 300 lives.
Adding to Boeing’s woes, its Starliner spacecraft returned from the International Space Station in September without astronauts due to technical issues. Moreover, nearly 33,000 Boeing factory workers have been on strike since mid-September, further straining the company’s resources.
Boeing CEO Kelly Ortberg, in an email to staff, outlined the need for layoffs to align with the company’s financial reality and future recovery plans. The delivery of the first 777X airplane has also been postponed to 2026, adding to the mounting pressures facing the aerospace giant.
Cramer’s concerns highlight the severity of the situation Boeing is facing. His statement about Boeing’s balance sheet and the missed opportunity to raise capital underscores the urgency of the company’s predicament. The layoffs and the postponement of the 777X delivery signal a difficult period ahead for Boeing as it seeks to navigate these challenges and regain stability.
