Boeing's latest problem: a possible junk downgrade

• S&P Global Ratings could downgrade Boeing bonds due to cash problems during a strike.
• The strike threatens Boeing's recovery and hurts 737 Max production – and the company's cash flow.
• Moody's also recently downgraded Boeing.

Adding to Boeing's list of woes, S&P Global Ratings is considering downgrading its bonds due to the company's growing liquidity problems amid a mass workers' strike.

S&P, which rates corporate bonds based on the company's ability to repay debt, has been reviewing the aircraft maker for a possible downgrade to junk status because the company is burning through cash so quickly, the agency said in a statement on Tuesday.

Junk status is given to bonds with a rating below BBB because they are more likely to be unable to repay their debts. A lower rating makes it more expensive for companies to borrow than for competitors with a higher rating.

The ratings agency estimated that the strike threatens Boeing's recovery and that the company will not meet its goal of increasing Boeing 737 Max production to 38 planes per month by year's end. S&P estimates Boeing will use $10 billion of cash this year.

Boeing also has about $4 billion in debt due in April 2025, the agency said.

Last month, another credit agency, Moody's, also downgraded the company, citing the strike and its impact on cash flow.

Boeing is a month into its layoff of 33,000 employees. The strike came on the heels of a vote in which workers in Washington and Oregon did not accept an agreement proposed by Boeing and the Machinists and Aerospace Workers Union.

Talks between Boeing and union leaders collapsed on Tuesday, two days after they resumed.

After the strike, Boeing made great efforts to prevent the crash leave a “large number” on leave of employees and said that management would take a pay cut for the duration of the strike. Boeing too Employees were banned from flying business class and implemented a hiring freeze.

The strike has halted production of the 737 Max, the company's best-selling jet.

In addition to financial difficulties, Boeing also faced a number of problems Reputation incidents this year because of security, after an incident where The door plug of an airplane burst through in flight.

Boeing did not immediately respond to a request for comment sent outside normal business hours.