Nikki Haley, the former South Carolina governor and U.N. ambassador who has been touted as a future presidential candidate, says she’s resigning from Boeing’s board of directors to protest the company’s request for $60 billion in federal aid.
Boeing has been hit hard by the impact of the coronavirus outbreak on the aviation industry, as well as the continued grounding of the 737 MAX fleet in the wake of two fatal crashes. This week the company said it supports a minimum of $60 billion in access to private and public liquidity for the aerospace manufacturing industry.
In a letter sent to Boeing CEO David Calhoun and the board, Haley said she couldn’t go along with Boeing’s request.
“I cannot support a move to lean on the federal government for a stimulus or bailout that prioritizes our company over others and relies on taxpayers to guarantee our financial position,” she wrote. “I have long held strong convictions that this is not the role of government.”
For that reason, she said she was resigning from the board position that she’s held since last year.
Haley served as South Carolina governor from 2011 to 2017 — a time during which Boeing significantly expanded its operations in the state, thanks largely to Charleston’s 787 Dreamliner factory. She resigned the governorship in 2017 to become President Donald Trump’s U.N. ambassador, and left that diplomatic post at the end of 2018.
Today, Senate Republicans unveiled their version of a $1 trillion aid package aimed at sustaining the U.S. economy amid the coronavirus outbreak. Although the measure includes $50 billion in loans and loan guarantees for commercial airlines and $8 billion for air cargo carriers, nothing is specifically held out for Boeing.
Earlier this week, Trump told reporters that he supported a Boeing bailout — and referred indirectly to the company’s 737 MAX troubles:
“it was unthinkable what happened, with respect to Boeing. Probably I would consider it the greatest company in the world prior to a year ago. Now they get hit in 15 different ways and they have different management. I’ve met the new people running Boeing. I think it’s going to be outstanding.
“But, yeah, we have to protect Boeing. We have to absolutely help Boeing. They were doing a job. … It was coming along well. And then all of a sudden, this hits. So, obviously, when the airlines aren’t doing well, Boeing is not going to be doing well. So we’ll be helping Boeing.”
Today, however, Trump said industry bailouts might come with strings attached. For example, he supported the idea of companies providing the federal government with an equity stake:
“Look, people are coming in for money. In some cases, no fault of their own. But in some cases, where they did certain things over the course of the years, including buying back stock — you know, they bought back stock and they paid a higher price for it, as it turned out. Maybe I view that as a little bit differently than somebody that didn’t and somebody that built plants all over the United States, of which there were plenty of them, too.”
Boeing has built new facilities over the past few years, including a billion-dollar 777X composite wing factory in Everett, Wash. But it’s also spent more than $43 billion over the past six years on stock buybacks.
Due to the fallout from the coronavirus outbreak, Boeing’s share price has fallen from its 52-week high of $398.66 to less than a quarter of that value, $97.71, as of today’s market close.
More from GeekWire:
- Boeing suspends its dividend, holds up buybacks and stops paying CEO and chairman amid pandemic
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