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Boeing Update—Stock price plummets as firm prepares to halt production on 737 Max

Finance and Securities, Liability, Litigation, Other

On Friday we discussed the recent setbacks faced by Boeing as it faced criticism from the FAA for rushing the recertification process for the 737 Max following its global grounding. In a major twist this morning, the aerospace giant indicated it is likely to halt production of the model, at least temporarily, as the timeline to get existing planes back in the air is moved back significantly. With 383 planes already in service grounded indefinitely and 400 finished planes sitting for delivery to customers, it makes little sense for the 12000 workers building the planes in Washington state to keep churning out 40 to 50 planes a month. This segment of Boeing’s workforce will be redirected into other projects as regulators continue to hold the 737 Max’s fate in limbo. Share prices swooned by more than 3 percent today with the news. [1]

[1] Edgecliffe-Johnson, A. (December 2019) Boeing shares fall as it debates 737 Max production halt from Financial Times Accessed December 16 2019

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