This morning National Legal and Policy Center presented a “Communist China Audit” proposal at The Boeing Company’s annual shareholder meeting that would require the company to produce a report that addresses its vulnerabilities related to its extensive business in the communist country.
The corporation’s board of directors opposed our resolution, as explained in its proxy statement. NLPC’s report on Boeing, which includes its response to the board’s opposition statement, was filed with the Securities and Exchange Commission last month.
Last year at this meeting I started my remarks by calling attention to the unrelenting financial losses for Boeing.
Here we are a year later, and the company still can’t seem to get out of its own way.
It would be interesting to hear from Mr. Calhoun why the company backed up this year’s annual meeting 11 days earlier than last year’s meeting, before it plans to announce its first-quarter earnings results for this year on April 26.
It seems like an uncomfortable subject is being avoided by scheduling the meeting earlier this year.
Last year earnings were announced a couple of days before the meeting.
Regardless, the topic of our proposal for Boeing is the risk it faces due to the significant dependence upon business in, and from, communist China.
According to at least one Wall Street analyst, with the increased political instability between the United States and Beijing following the recent spy balloon incident, Boeing faces a “new China crisis.”
As we state in our proposal, we would like greater disclosure from the company as to how true that is.
According to the company’s own limited disclosures, China “has a component role on every current Boeing commercial airplane model … More than 10,000 Boeing airplanes currently fly throughout the world with parts and assemblies built in China.”
Boeing has over 35 direct suppliers in China and is the largest international customer of Chinese commercial aviation manufacturing.
On the customer side of things, Boeing’s access to China’s commercial airline market has been nearly shut out. Just two weeks ago another deal was announced between Boeing’s top competitor, Airbus, and China – widening the gap between the two top airline manufacturers.
It only confirms what Mr. Calhoun told investors in October – that “It’s really hard for me to find signals that things are going to change in China and move in our direction.”
And now, adding insult to injury, a state-owned Chinese plane manufacturer is about to market its own commercial jet to compete with Boeing.
As a former US deputy national security adviser said, “It really looks like a knockoff.”
He also said, “China has a lot of different varieties of ways of relieving people of their intellectual property.”
Whether or not Boeing re-establishes a foothold in the Chinese market, regardless, it looks like this business partnership with their government-controlled entities has turned extremely bad.
As many American multinational corporations have been repeatedly warned, if you go into business with international thugs who have no reservations about torturing, maiming and disappearing their political opponents, you shouldn’t be surprised that they will steal your stuff too.
We urge shareholders to vote FOR Proposal number six, to make Boeing more transparent about its risks related to business with China.
Read NLPC’s shareholder proposal for The Boeing Company here.
Read NLPC’s report to Boeing’s shareholders, filed with the SEC, here.
Listen to Chesser’s three-minute remarks at the Boeing annual meeting here.