• Boeing CEO David Calhoun said company will not take fed money if it means giving up equity stake.
  • Boeing shut down plants across Puget Sound which employ 70,000 people
  • Boeing shares have plunged in half since Feb. 21 

U.S. Treasury Secretary Steve Mnuchin claimed on Friday that troubled aerospace giant Boeing (BA) does not want federal bailout money.

"Boeing has said that they have no intention of using a program that may change in the future," Mnuchin told Fox Business News. "These are things that the companies need to come and ask us for. Right now, Boeing's saying they don't need it."

Boeing was reportedly eligible to receive a portion of the $454 billion that the Treasury Department will supervise under the $2 trillion stimulus bill. Boeing could potentially also receive much of the $17 billion in loans targeted for national security matters.

On Tuesday, Boeing CEO David Calhoun said his company would not accept federal money if it meant relinquishing equity stake to the government.

“Nobody has an interest in retaining government equity in their company,” Calhoun said. “We want to pay everything back. Everybody does. If [Congress] forces it, we just look at all the other options, and we’ve got plenty of them. It’s just not ideal for us or our suppliers -- all of those companies spread throughout the United States. It’s not ideal if we don’t have it, but if they attach too many [strings] to it, of course [we] take a different course.”

Boeing has $15 billion in liquidity, which is probably sufficient to survive the coronavirus crisis. The company has also suspended its dividend payments and cut other costs.

However, some analysts are skeptical that Boeing can survive without federal aid.

Ken Herbert, investment banking analyst at Canaccord Genuity, said Boeing may have no other viable options than federal funds since private sector financing will likely not be forthcoming.

"We expect Boeing to eventually take the government aid, even with unattractive strings attached, as we believe airline demand will continue to fall," he wrote.

Also, once the currently grounded 737 Max aircraft returns to service, deliveries are expected to be slow since airlines have been cutting capacity.

Michael Bruno of Aviation Week also pointed out that Boeing finished 2019 with more than $27 billion in debt. By mid-March 2020, the company had fully drawn down a new credit line of nearly $14 billion.

As such, some Washington state lawmakers want Boeing to take a federal bailout.

“With supply-chain layoffs already happening, it’s important for the aerospace industry -- which employs 136,000 Washingtonians -- to have access to capital and liquidity,” said U.S. Sen. Maria Cantwell, D-Wash., after the deal passed the Senate.

The Seattle Times editorial board implored Boeing to accept money from the federal government.

“Federal leaders are right to make rescue money available, and to attach meaningful conditions to it,” the Times opined. “Along with the equity stake, stimulus money would require limiting executive salaries -- Calhoun is foregoing his already -- and forbid stock buybacks to shore up the price. In Boeing’s specific case, the requirements should also include systemic reforms to corporate governance, including a reform of the board of directors, so oversight lapses that enabled past mistakes don’t recur.”

Meanwhile, Boeing has shut down plants across the Puget Sound, Wash. for at least the next two weeks. These facilities employ some 70,000 people.

Also, at least 30 Boeing employees have tested positive for the coronavirus and one employee at a plant in Everett, Wash. died on Monday of complications related to the virus.

As of 1:45 p.m. EDT, Boeing shares were down 7.3%.

Shares have been cut in half since Feb. 21.