United

Safety

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<p class="has-drop-cap">The US Federal Aviation Administration (FAA) and multiple airlines <a aria-label="announced (opens in a new tab)" href="https://www.bloomberg.com/news/articles/2024-01-07/the-airlines-and-regulators-taking-action-on-boeing-737-max-jets" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">announced</a> a temporary grounding of the 737 Max 9 jet after one of the planes experienced a mid-air incident on Friday. Boeing’s shares (NYSE: BA) fell over 8.4% in premarket trading Monday.&nbsp;</p>
<h3 id="regulators-airlines-ground-737-max-jets">Regulators, Airlines Ground 737 Max Jets</h3>
<p>Shares of Boeing tumbled 8.43% in premarket trading Monday after the Federal Aviation Administration (FAA) ordered a temporary grounding of 171 Boeing 737 Max 9 jets following a mid-flight incident where a piece of the jet ejected during an Alaska Airlines flight on Friday. Images shared on social media platforms showed a hole in the side of the jet and passengers using oxygen masks.&nbsp;</p>
<p>The grounding will likely mainly affect US flights. The FAA also ordered “immediate inspections” of 737 Max 9s. The regulator added that the required investigation would take about four to eight hours per aircraft. The National Transportation Safety Board has also launched a probe into the blowout.</p>
<p>The European Union Aviation Safety Agency (EASA) said it had adopted the FAA’s directive. It also said that no European airline in an EASA member state operated 737 Max 9 in the affected Boeing configuration.&nbsp;</p>
<p>United Airlines, the biggest operator of the affected jet, grounded all 79 of its Max 9 planes. Alaska Airlines grounded all 65 of its 737-9 Max jets, cancelling 160 flights on Saturday.&nbsp;United Airlines (NASDAQ: UAL) shares were down 3.02% at the time of writing, and Alaska Airlines (NYSE: ALK) shares dipped over 4%.</p>
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<h3 id="boeing-s-737-max-issues-began-in-1997">Boeing’s 737 MAX Issues Began in 1997</h3>
<p>Large-scale groundings by aviation regulators are uncommon, though they happened <a aria-label="multiple times to Boeng’s 737 MAX (opens in a new tab)" href="https://en.wikipedia.org/wiki/Boeing_737_MAX_groundings" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">multiple times to Boeng’s 737 MAX</a>.</p>
<p>The <a href="https://tokenist.com/boeing-falls-5-5-premarket-after-737-max-deliveries-halted/" rel="noopener noreferrer nofollow" class="deco-link">troubled model</a> has been under scrutiny since facing a <a href="https://tokenist.com/boeing-shares-up-in-premarket-as-china-mulls-lifting-737-freeze/" rel="noopener noreferrer nofollow" class="deco-link">worldwide grounding</a> five years ago following two fatal crashes that killed 346 people. In November 2020, the FAA ended the longest-ever grounding of a US airliner. The accidents and grounding cost the plane maker an estimated $20 billion in penalties, compensation, and legal fees. Indirect losses amounted to over $60 billion.&nbsp;</p>
<p>In 2021, four airlines temporarily grounded 737 MAX again due to electrical issues.&nbsp;</p>
<p><a aria-label="According to Quartz (opens in a new tab)" href="https://qz.com/1776080/how-the-mcdonnell-douglas-boeing-merger-led-to-the-737-max-crisis" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">According to Quartz</a>, the crisis involving the 737 MAX dates way back to 1997, when Boeing <a aria-label="acquired (opens in a new tab)" href="https://airwaysmag.com/boeing-mcdonnell-douglas-merger/" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">merged</a> with its long-standing plane manufacturer rival, McDonnell Douglas. The report said the takeover resulted in a “clash of corporate cultures,” with the smaller company winning.&nbsp;</p>
<p>Clive Iring, author of “Jumbo: The Making of The Boeing 747,” said while Boeing was supposed to take over Mcdonnel Douglass (the smaller company), “it ended up the other way around.”</p> <iframe src="https://tokenist.substack.com/embed" width="100%" height="320" style="border:1px solid #EEE; background:white;" frameborder="0" scrolling="no"></iframe>
<p><em><strong>Could the latest 737 MAX issue lead to another long-term bearish trend for Boeing’s stock? Let us know in the comments below.&nbsp;</strong></em></p>
<p>The post <a rel="noopener noreferrer nofollow" href="https://tokenist.com/boeing-united-airlines-dip-premarket-as-us-grounds-737-max-jets/">Boeing, United Airlines Dip Premarket as US Grounds 737 Max Jets</a> appeared first on <a rel="noopener noreferrer nofollow" href="https://tokenist.com">Tokenist</a>.</p>

Boeing, United Airlines Dip Premarket as US Grounds 737 Max Jets

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