What is going on with Boeing?
What is going on with Boeing?
With recent news, it feels as though all airplanes are going to fall out of the sky. I promise you, they will not. What is falling though, however, is the Boeing stock and any hopes of Boeing’s success in the future unless they change their business plan and invest more in the mechanics and design of their planes for safety.
Recently, an engine cowling on a Southwest Airlines Boeing fell off during takeoff on April 7th. This scary malfunction of a machine that holds dozens of people thousands of feet in the sky made it essential that the U.S. Federal Aviation Administration (FAA) launched an investigation. The FAA's primary role in the U.S. is managing all the flights in the air and ensuring that there is ample communication between all the machines. More relating to the issues modernly, the FAA issues and enforces regulations and certain minimum standards covering maintaining, operating, and manufacturing aircraft. With the FAA getting involved on this issue, the legitimacy of Boeing aircrafts can hopefully be restored in the future.
This feat will be difficult though. In January of 2024, a door plug panel blew off an Alaska Airlines aircraft in the middle of the flight. The horror of this occurring while the flight was mid-air at 16,000 feet outraged the public. To respond to this, the FAA issued a temporary grounding of all the Boeing 737 Max 9 planes, which was the specific model of the plane with a faulty door. The FAA planned to address “systemic quality-control issues” (newsweek.com ).
There have been a total of 29 incidents, accidents, and overall occurrences involving Boeing since January 1st of this year. Surprisingly, there were more last year. In 2023, there were 34 incidents, but none reached headlines the same way this year’s did.
How has this affected Boeing?
This recall of planes and distrust from consumers has hit Boeing hard. The CEO of Boeing stepped down and went on CNBC to speak about the recent issues going on. "This company and our people have responded to the crisis like no group of employees I've ever seen or been around," Calhoun said on Squawk Box. "They certified the airplane, they started up a factory from zero, they created a shadow factory to get our planes back into the field, they created another shadow factory to rebuild all of our 787s, a hundred of them”. (newsweek.com).
But even though the CEO stepped down and Boeing pledged to make changes, consumers are not convinced. In a poll involving 1,000 Americans who fly commercially often done by casinos.us, around 50% would pay between $50-150 for tickets on aircrafts other than Boeings. 23% would pay less than $50. 36% would choose to avoid flying on a Boeing aircraft if they could. This clearly shows how Boeing will have to do much more to gain back the trust of consumers , not just remove the CEO. This will affect people's travels in the summer as the availability of Boeing planes will be lower, and plane tickets will be in higher demand and therefore more expensive. (So if you are planning on traveling this summer, buy your plane tickets now!)
How has this affected the Boeing stock?
Not too surprisingly, the Boeing stock has been tumbling. Conversely, Airbus stock has risen as investors have digested all the media on Boeing. Deliveries of Boeing 737s have decreased significantly. Boeing delivered 83 planes in Q1, which is down from 157 in the previous quarter (finance.yahoo.com).
BY IZZI SCHULTE