River ‘piracy’ gave towering Everest a growth spurt, scientists say
Police leaders jailed in South Korea over 'man-made' fatal Halloween crush
US to unveil first of two decisions on more solar tariffs
Which countries have pledged aid to Lebanon as conflict worsened?
Kremlin, asked on Iran's use of Russian comms devices after pager attacks, says trade is growing
Police release bodycamera video showing Ryan Routh's arrest
China's central bank buys 200 billion yuan of sovereign bonds in September
Brazil private economists forecast two 50-basis-point rate hikes this year
Braves host Mets in doubleheader to determine last two NL playoff teams
A look back on the legacy of basketball Hall of Famer Dikembe Mutombo
NBA-Shot-blocking great Dikembe Mutombo dies at 58, NBA says
(Reuters) -Fitch Ratings lowered its 2024 forecasts for Boeing's aircraft delivery and free cash flow on Friday as the planemaker grapples with investigations and slumping production of its strongest-selling jet.
"The delivery forecasts were affected by the Civil Aviation Administration of China's (CAAC) decision to restrict certain aircraft model deliveries to Chinese customers while it requests additional documentation regarding voice recorder and battery information," Fitch said.
The forecast revision also reflects the U.S. Federal Aviation Administration's decision to maintain oversight within Boeing's factories while individually certifying newly produced aircraft.
Boeing currently has a BBB-minus rating, one level above "junk" status, with a negative credit rating outlook from multiple agencies as output of its 737 MAX slipped into the single digits at times this spring. The U.S. planemaker said earlier this month it would burn cash rather than generate cash.
Fitch and other agencies do not currently expect these latest adjustments to result in rating changes.
Jonathan Root, senior vice president, Moody’s Ratings, said on Friday that Boeing's recent comment about negative free cash flow was unexpected.
“This is another example of ongoing negative surprise from Boeing while it rehabilitates its commercial airplanes business," Root told Reuters.
However, he said Boeing's bolstering of liquidity after a $10 billion May debt issue currently mitigates "potential ratings pressure."
Nick Varone, a senior director at Fitch, told Reuters that the possibility of Boeing's burning free cash for 2024 was generally incorporated into the agency's negative outlook.
Varone cited a return in 737 MAX production rate to around 38 a month, or inventory reduction as things Fitch is looking for to get back to a stable outlook.
The rating agency forecasts from 350 to 370 737 MAX deliveries and about 65-70 787 deliveries in 2024, below previous expectations of about 400 and 75, respectively.
(Reporting by Kannaki Deka in Bengaluru, Allison Lampert in Montreal and Shivansh Tiwary in Bangalore; Editing by Alan Barona and Leslie Adler)
