Boeing
shares slipped Tuesday after
Alaska Air Group
and
United Airlines Holdings
said they had discovered loose parts on 737 MAX 9 jets that they inspected. It’s a mistake the company needs to own up to, according to CEO Dave Calhoun.
On Friday, part of the body of Alaska Air Flight 1282 flew off the plane 10 minutes after takeoff, creating an exit-door-sized hole in the side of the aircraft. The plane made an emergency landing and no one was hurt.
Boeing
stock dropped 1.4%, closing at $225.76, after falling 8% on Monday. The
S&P 500
dropped 0.2%. The
Nasdaq Composite
gained 0.1%.
Spirit AeroSystems,
which supplies fuselages to Boeing, rose 0.1% after falling 11% on Monday.
Alaska Air
shares dropped 1.2%, while
United Airlines
stock rose 1.4%.
AAR
stock also took a hit again. Shares fell 0.4% after falling 1.9% Monday.
AAR maintains aircraft for airlines and Deutsche Bank analyst Scott Deuschle pointed out in a Monday report that the Alaska Air MAX 9 jet was in Oklahoma, shortly before Alaska Air Flight 1282 departed Portland.
“Alaska has a relationship with third-party maintenance provider AAR, which has an airframe [maintenance] facility in OKC,” wrote the analyst, referring to Oklahoma City. He said it was that possible that the work there involved the door that came loose.
Â
AAR said that wasn’t the case. The jet was at an AAR facility from Nov. 27 to Dec.7, but “AAR did not perform any work on or near any mid-cabin exit door plug of that specific aircraft,” said the company in a statement.
Investigators at the National Transportation Safety Board confirmed that the part blew off at about 16,000 feet after coming loose from a set of stops designed to keep a door plug in place. The bolts needed to keep the plug in place were missing, but the NTSB said it doesn’t know what exactly went wrong to cause the part to move out of position.
Calhoun told Boeing employees Tuesday that the company needs to acknowledge its mistake. “We are gonna approach this—No. 1—acknowledging our mistake,” read a part of the comments relayed by Boeing in an email. “We’re gonna approach it with 100% and complete transparency every step of the way.”
Boeing didn’t immediately respond to a request for comment about Calhoun’s talk.
Separately, in an interview with the Financial Times on Tuesday,
Ryanair
CEO Michael O’Leary said Boeing needs to “significantly improve quality control.” He said Ryanair’s passenger numbers and profits will be hit by Boeing delivery delays. Ryanair operates other 737 MAX jets but not the MAX 9.
United said Monday it found four instances in which bolts on the door plugs of other airplanes appeared to have installation issues such as needing additional tightening. Alaska Air also said that technicians had reported loose parts on other planes.
The Federal Aviation Administration over the weekend temporarily grounded all 737 MAX planes after the incident.
Both United and Alaska were reporting more flight cancellations on Tuesday than any other airline, according to the flight tracking site Flight Aware. United scrapped 191 scheduled trips, and Alaska canceled 106. On Monday, United had canceled 263 flights and Alaska, 158.
Along with following the emergency door plug issue, Boeing investors also got December deliveries from Boeing. The company delivered 67 planes in December, including 44 MAX jets.
For the fourth quarter deliveries came in at 157 jets including 107 MAX jets. Those numbers are in line with Wall Street estimates of 154 jets, according to FactSet.
Write to Brian Swint at [email protected] and Al Root at [email protected]
Read the full article here
