Newspaper article St Louis Post-Dispatch (MO)

Boeing Slows Payments to Suppliers as It Accelerates Cost-Cutting

Newspaper article St Louis Post-Dispatch (MO)

Boeing Slows Payments to Suppliers as It Accelerates Cost-Cutting

Article excerpt

NEW YORK * Boeing Co. is stepping up efforts to conserve cash, cut costs in its supply chain and trim inventory of parts in its factories, telling vendors it will take longer to pay bills, Boeing and aerospace industry executives said.

Under the new terms, Boeing is taking up to 120 days to pay, rather than 30 days as in the past, these people said. The new schedules are being rolled out this year.

Boeing also is reducing its factory inventory and is relying on suppliers to hold parts instead, these people said. The moves come at a time when investors are closely watching Boeing's cash flow.

In a statement to Reuters, Boeing confirmed the changes in terms, saying they were necessary to compete when airlines want more capable planes at lower prices.

"To align with industry norms" and remain competitive, "we are in the process of adjusting the payment terms of our large suppliers," spokeswoman Jessica Kowal said in the statement. …

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