A new incident adds to the previous challenges that Boeing faced with the 737 MAX model, deepening its image and performance problems in the market, apart from the financial and stock market problems that this entails.
This incident represents a significant challenge for Boeing in its quest to regain public trust. and its reputation in the aviation industry.
The actions of aerospace giant Boeing suffered a significant setback this Monday, plunging to $226.74, which represented a drop of 8.9% and marked the lowest closing price since the end of November of last year. This abrupt descent cut a two-day winning streak for the company’s shares.
The recent decline represented a 13.1% decline in the value of Boeing shares, both month to date and year to date. Despite this drop, the company’s shares managed to maintain an increase of more than 8% compared to the same period last year. Besidesthe current share price is still substantially higherby almost a third, to the annual minimum recorded on October 25.
Boeing shares then suffered their biggest intraday decline since October 2022, making them the worst performers within the Dow Jones Industrial Average (DJIA) this Monday. The sharp decline in Boeing shares put strong downward pressure on the DJIA, dragging more than one hundred points to the index.
Boeing: what’s behind the plot on Wall Street
The background to this drop is associated with worrying reports about Boeing 737 MAX 9 aircraft finding “loose components” during preliminary inspections. Both United and Alaska Airlines reported these findings after the incident of a window that fell off in mid-flight from a plane of this model.
The Federal Aviation Administration (FAA) is conducting investigations following the explosion of a component called “door stopper” on an Alaska Airlines passenger plane, forcing it to make an emergency landing last Friday.
Airlines, including AeroMexico, are conducting extensive inspections, suspending operations and, in some cases, identifying loose components on their 737 MAX 9 aircraft. This series of events has raised safety issues and severely impacted Boeing’s reputation and stock performance.
The FAA has implemented new inspections and protocols, grounding Boeing 737-9 aircraft until operators complete reviews. Meanwhile, there is speculation about a possible quality control or manufacturing defect as the cause of the problem.
This incident represents a significant challenge for Boeing in its quest to regain public trust. and its reputation in the aviation industry. Analysts underscore the need for a fundamental change in company culture to address these recurring challenges, as company leadership prepares to meet and address this critical issue.
Although the direct financial impact could be contained, the magnitude of the security problem raises concerns on future government approvals and could result in delays in the approval of new devices or proposed repairs, according to industry analysts. This incident adds to the previous challenges that Boeing faced with the 737 MAX model, deepening its image and performance problems in the market.
Source: Ambito
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