US Aviation and Automotive Companies Post Significant Losses in Q2 Due to COVID-19 Impact

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Major airlines and automobile manufacturers leading the U.S. economy posted consecutive losses in the second quarter due to the COVID-19 pandemic. With the virus resurging in some states, future earnings prospects remain bleak.

On the 29th (local time), according to Bloomberg News and others, aircraft manufacturer Boeing announced a net loss of $2.4 billion (approximately 2.9 trillion KRW) in the second quarter. Revenue plunged 25% year-on-year to $11.8 billion, falling short of market expectations ($13.16 billion). Boeing is also expanding its layoffs. Initially, it planned to reduce 10% of its total workforce of 160,000 employees, or 16,000 people, within this year, but the Wall Street Journal (WSJ) reported that the target was increased by 3,000 more.

General Electric (GE), which announced its earnings on the same day, also posted a net loss of $2.2 billion in the second quarter due to sluggish aviation business and other factors. Considering it had a loss of $61 million in the second quarter of last year, the scale has significantly increased. Orders for aircraft engines sharply declined, causing revenue in this segment to drop from $7.88 billion to $4.38 billion. Despite increased sales of oxygen respirators, medical business revenue also decreased compared to the previous year.

Automaker General Motors (GM) recorded its first quarterly loss since facing bankruptcy in 2009. GM posted a loss of $758 million in the second quarter, with revenue halving to $16.78 billion, down 53% year-on-year. Although GM anticipated a return to profitability in the second half of the year, Divya Suryadevara, GM’s Chief Financial Officer (CFO), expressed cautious views, stating that the situation remains very fluid.

This content was produced with the assistance of AI translation services.