Defense Firm CEOs Send Letters to US Gov’t for Up to $15bn COVID-19 Lifeline
By Staff, Agencies
Top executives from eight defense firms in the US have urged the US government to ensure billions will not be reallocated to other firms affected by the ongoing coronavirus pandemic without replacing the funds, Reuters reported on Wednesday.
Defense firms Lockheed Martin Corp, Raytheon Technologies Corp, BAE Systems Inc, General Dynamics, Boeing Co's defense wing, L3Harris Technologies Inc, Huntington Ingalls Industries and Textron Inc published separate letters sent to the White House and Pentagon, voicing concerns over COVID-19 expenses "well beyond" the Pentagon's funding, potentially blocking US efforts to modernize its military, the report read.
Pentagon officials have reportedly requested funds in the "lower double-digit billions" to the White House Office of Management and Budget amid fears over losing high-skilled workers facing redundancies or poaching by competitor firms.
According to defense industry analyst Jim McAleese, up to $15bn may be needed to save the nation's defense industry, the report read.
Chief executive Greg Hayes issued a temporary 10 percent base pay cut in June to all salaried staff at its Pratt & Whitney and Collins Aerospace Systems businesses as well as corporate offices, a press statement revealed.
But according to Boeing chief executive David Calhoun, the ongoing pandemic was "affecting every aspect of our business" but that the company was working to tackle the "unprecedented health crisis and adapt for a changed marketplace".
“While COVID-19 is adding unprecedented pressure to our business, we remain confident in our long term future. We continue to support our defense customers in their critical national security missions," Calhoun said at the time.
To date, Boeing holds cash flows of $4.3bn with revenue losses of roughly $19bn and over 12,000 jobs due to numerous crises, including COVID-19 workforce shortages and the ongoing 737 Max crisis, according to company figures.
Two crashes involving the troubled aircraft resulted in 346 deaths in Indonesia and Ethiopia in recent years, with investigations suspecting the Maneuvering Characteristics Augmentation System [MCAS]. The US Federal Aviation Authority began performed flight tests in late June ahead of efforts to recertify the troubled aircraft, according to reports.