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Trading of Boeing’s Stock Halts, MAX Production Stops, Certification TBD

Trading of Boeing’s Stock Halts, MAX Production Stops, Certification TBD
Joe Cortez

The Boeing Company is facing additional backlash from both the Federal Aviation Administration and even the President of the United States, after announcing another delay of the Boeing 737 MAX re-certification. The Chicago-based company now says the airplane may not fly again until the summer of 2020.

The troubled Boeing 737 MAX will not fly until the middle of 2020, according to a recent statement by the Chicago-based manufacturer. The news is not only being criticized by politicians, but could be costing jobs as well.

The aircraft was first grounded after two fatal accidents in 2019: Ethiopian Airlines Flight 302, killing all 157 souls on board, and Lion Air Flight 610, killing 181 souls on board.

Boeing’s Statement on the 737 MAX

Trading of the Boeing stock was temporarily halted before the news was released. Although it was expected, the stock markets still punished the company over the announcement, with the stock continuing to drop in price in trading as of 12 noon Eastern Time on Jan. 22, 2020.

“We are informing our customers and suppliers that we are currently estimating that the ungrounding of the 737 MAX will begin during mid-2020,” the statement read. “This updated estimate is informed by our experience to date with the certification process. It is subject to our ongoing attempts to address known schedule risks and further developments that may arise in connection with the certification process.”

The statement went on to read that the delayed timeline would also account for additional investigation during the recertification process. Boeing specifically noted the “Joint Operations Evaluation Board process,” which will ultimately dictate how pilots will be trained and certified once the 737 MAX comes back online.

The Ramifications From the Continued 737 Max Grounding

Errors in the pilot training, certification and airworthiness inspection of the 737 MAX is costing Boeing money from many different fronts. The Federal Aviation Administration is proposing over $8 million in fines against the company in part due to the 737 MAX. Of them, $5.4 million is for “nonconforming slat tracks” installed in the completed 178 737 MAX aircraft, and $3.9 million for “installing nonconforming components” on an unidentified 133 aircraft.

The problem is so big, the company is putting the entire 737 MAX production operation on hold. CNN reports the assembly line temporarily shut down on Jan. 20, 2020. While the manufacturer is not planning on any labor furloughs or layoffs, Boeing supplier Spirit AeroSystems announced 2,800 layoffs due to the 737 MAX suspension.

Even the President of the United States is weighing in on the problem. In an interview with CNBC, Donald Trump called Boeing “A very disappointing company.”

“When you talk about growth, it’s so big, that some people say it’s more than a half-point of GDP,” Trump told CNBC from the World Economic Forum. “So Boeing…big, big disappointment to me.”

How American Carriers Are Taking the News

As long as the 737 MAX is under ground orders, American carriers are prohibited from flying them. And with the news that re-certification may not come until Summer 2020, domestic operators are adjusting their timelines carefully.

American Airlines states they believe the 737 MAX will be back in service by June 4, 2020. Until then, all 737 MAX aircraft are being removed from their schedule. The airline says they will adjust their schedule in February 2020 to adjust for the lost 737 MAX aircraft, and all itineraries will be automatically updated.

Southwest Airlines – the biggest domestic owner of 737 MAX aircraft – is removing the airframe from their schedule through June 6, 2020. This furthers their previous schedule change through April 13, 2020. The airline says by removing the aircraft from their schedules, they can “reduce last-minute flight cancellations and unexpected disruptions to our customers’ travel plans.”

United Airlines has not updated when they anticipate the 737 MAX will go back into service.

View Comments (5)

5 Comments

  1. born sleepy

    January 22, 2020 at 3:02 pm

    Boeing will never recover flyer confidence for this plane. I won’t fly on one, not so much over MCAS but over how Boeing lied and covered up. Because what else did they hide about this plane that should never have been approved for production in the first place? Bolting huge modern engines on a frame designed for JT8Ds cigars without also completely redesigning the gear for proper ground clearance would have cost too much, we’ll just jam the engines higher up the wing, what could go wrong?

    The program should be canceled, the extant planes scrapped, and Boeing hit with a multi-billion-dollar fine and loss of DoD contracts. Their behavior was inexcusable.

  2. Centurion

    January 22, 2020 at 5:50 pm

    The plane should have never been called a 737 with all of the design changes made.

  3. noneemac

    noneemac

    January 22, 2020 at 9:53 pm

    Hello, Copy Editor?! This article is rife with errors and typos, and it should never have been published without a thorough review. Most glaring is the writer’s assertion that all “souls” were killed in the crashes. Let’s start there, and then clean this mess up!

  4. SamirD

    January 22, 2020 at 10:52 pm

    This is the biggest case of American shortsightedness since General Motors. And it’s sad really. Boeing did a lot to earn the top dog in the air. And now they’re potentially going to lose it all…disappointing is true.

  5. caljn

    January 26, 2020 at 8:28 pm

    So trumpy is disappointed in Boeing because it will affect “his” economic performance.

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