Transportation
Boeing Faces $100 Million More in Interest Costs If Rating Is Cut to Junk
- Coupon would increase .25 percentage points for each downgrade
- So-called step ups capped at 1 percentage point at each grader
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Boeing Co.’s annual interest costs could rise by at least $100 million if its credit rating is cut to junk, adding to its troubles as it navigates stalled union talks and seeks to shore up fresh capital.
The planemaker’s credit rating is already on the cusp of junk and is being reviewed for downgrade at both S&P Global Ratings and Moody’s Ratings. For every step its ratings are cut by Moody’s or S&P, its borrowing costs will rise by 25 basis points, or 0.25 percentage point.