The Trump administration, lawmakers and political candidates are under increasing pressure to find ways to help the United States weather the coronavirus pandemic and the economic turmoil that accompanies it.
Defense spending takes on new importance for the aerospace giant, one of America’s largest defense contractors, as its commercial aircraft unit pulls out of the pandemic. The turmoil led Boeing to a loss of $ 2.4 billion in the second quarter, leading to further cuts in production of planes like the 787 and the possibility of job cuts beyond the estimated 19,000 people who the company said would leave Boeing.
Boeing’s defense and space unit revenue was little changed from the second quarter of last year to $ 6.6 billion, but sales of its commercial aircraft unit fell by more than 65% year over year to $ 1.6 billion.
The trend has been picked up in other companies like Raytheon Technologies which have both commercial and defense activities.
“Overall, as the pandemic continues to have a profound impact on our commercial aviation business, our balanced portfolio includes resilient defense business that will help us offset short-term aviation trade headwinds,” said the CEO Greg Hayes on an analyst call Tuesday.
The White House did not comment. Representatives of Trump and Biden’s presidential campaigns did not immediately comment.
Defense contractors have good reason to be concerned. Current Republicans across the country are being dragged down by the president’s poor approval ratings, despite efforts by some candidates to distance themselves from Trump’s positions. Yet most analysts now believe Democrats are in a good position to broaden their majority in the House and, increasingly, to win the net four Senate seats they need to take control of the upper chamber.
Boeing’s Calhoun brushed aside the possibility of an impact on the industry due to a potential change in Congress, saying lawmakers “tend to rally” on policies that support jobs.
Like many Fortune 100 companies whose financial results are heavily influenced by both government spending and federal regulation, Boeing is careful not to get too involved in partisan politics or give the impression that ‘he favors one party over the other.
So far, in the 2020 election cycle, Boeing’s Political Action Committee has donated $ 1.1 million to federal candidates. Of that total, 47% went to Democrats and 53% to Republicans, according to the Open Secrets campaign funding tracking website.