[Editor’s note: The article was originally published in December 12, 2016 after the Republican presidential candidate Donald Trump was elected to become the 45th US President in January 20, 2017.]
On Dec. 12, President-elect Donald Trump attacked the F-35 Joint Strike Fighter on Twitter, saying the cost of the next-generation stealth plane is “out of control.”
The F-35 program and cost is out of control. Billions of dollars can and will be saved on military (and other) purchases after January 20th.
— Donald J. Trump (@realDonaldTrump) December 12, 2016
A presidential tweet can have some serious corporate repercussions: In subsequent trading, shares in Lockheed Martin, the company that produces the aircraft, dipped more than 4%, and its market value plunged by $4 billion, according to CNBC.
To put that in perspective, it’s 1/100th the estimated cost of the weapons program itself, which some believe could reach $400 billion.
Lockheed isn’t the only one. Last week, Trump called out Boeing as well.
Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!
— Donald J. Trump (@realDonaldTrump) December 6, 2016
Boeing secured a contract in January 2016 to start work on the 747 jets meant to replace the 25-year-old Air Force One planes, which will be phased in early next decade.
And although its stock price dipped by 1% after the tweet, it has since recovered.
But companies across the country are feeling the sting of Trump’s Twitter attacks.
Northrop Grumman is only a component producer on the F-35, and its stocks hit a one-month low as a result of the tweet.
While these companies have more than enough financial capital to withstand such attacks, other smaller contractors may not be so resilient.
Hopefully these companies fare better than the F-35 in a thunderstorm.
Around the same time the president-elect was firing off his tweet, a pair of the stealth aircraft that were scheduled for delivery to Israel — the first installment of 50 planes that have been promised — were grounded for several hours in Italy due to bad weather.
By Sarah Sicard, TaskandPurpose.com
Originally posted on December 12, 2016
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Lockheed Martin stock takes hit from Trump tweet