Fitch Ratings has signalled increased confidence in Boeing’s financial and operational stability by boosting its long-term credit outlook for the aircraft manufacturer.
The ratings agency said on 30 June it has revised its outlook for Boeing to “stable” from “negative”.
It cites Boeing’s cash on hand, its recovery from last year’s machinists’ strike, and other “sustained operational improvements, particularly continued 737 Max production progress”.
Fitch has left its credit rating for Boeing unchanged at BBB-, which the agency defines as “good credit quality” and within the range of investment-grade credit.
Assigning Boeing a “stable” outlook means Fitch expects the company’s BBB- credit rating will likely remain unchanged for one to two years, it says.
Fitch had in April 2024 assigned Boeing a negative outlook, signalling that, at the time, Fitch saw “increased risk” of downgrading Boeing’s credit rating.
With the outlook upgrade, Fitch notes Boeing has recently increased 737 production to a “mid-30s” monthly rate. It expects Boeing will hike 737 output to 38 monthly in the third quarter of this year, and that Boeing will increase 787 production to eight monthly next year. Boeing has recently been producing five 787s monthly with the goal of reaching seven monthly before year-end.
Fitch also cites Boeing’s progress ridding itself of its once-massive inventory of stored 737 Max – jets it had produced but not delivered in recent years due to required rework. Boeing has said it expects to complete rework on the last of those stored 737 Max this year.
Boeing also has a “robust liquidity position”, says Fitch, noting it raised $24 billion in equity last year and is on track to bolster its coffers with the planned $10.5 billion sale of several digital businesses, including Jeppesen.
Fitch expects Boeing’s 737 Max deliveries will hit the “high-400s” this year and the “mid-50s” next year. For context, Boeing delivered 265 737s in 2024.
