by Boeing’s stock price fell sharply on Monday, in the first trading session after part of the fuselage of one of its 737 Max 9 planes exploded on an Alaska Airlines flight Friday night.
Boeing shares fell nearly 7 percent and Spirit AeroSystems, which made the door plug that tore off the plane, fell about 8 percent, recovering from a much steeper drop in early trading.
The Alaska Airlines flight departing Portland, Oregon, lost its mid-cabin door plug midair, exposing passengers to high winds and forcing an emergency landing. None of the 171 passengers and six crew members on board were seriously injured.
The Federal Aviation Administration on Saturday ordered U.S. airlines to ground all of their Boeing 737 Max 9 planes. The National Transportation Safety Board is investigating the incident.
United Airlines and Alaska Airlines, the largest users of the Max 9, canceled more than 350 flights on Monday, representing 8 percent of United’s schedule and 20 percent of Alaska’s, according to Flight reported. United shares rose 1.7 percent on Monday, while Alaska shares fell 2.5 percent.
Other airlines with Max 9 aircraft in their fleets are located outside the United States, such as Panama’s Copa Airlines, Turkish Airlines and Islandair. Those planes may not be subject to the same regulatory action. The aviation safety agency of the European Union Announced Monday that Max 9 planes operating in Europe were not grounded because they had a different configuration than the Alaska Airline plane that was forced to make an emergency landing.
Boeing said early Monday morning that it had issued instructions on how airlines should conduct inspections of the plane.
Spirit AeroSystems said in a statement Monday that it is “a committed partner with Boeing on the 737 program, and we continue to work together with them on this matter.”
Another version of the Max, a 737 Max 8, was involved in two crashes that killed hundreds of people in 2018 and 2019, leading to its global grounding. And last month, Boeing urged airlines to inspect the more than 1,300 Max planes delivered for a possible loose bolt in the rudder control system.
While investors were spooked, few analysts expected the financial damage to Boeing and others to persist, based on what they had seen from regulators and the companies after the Alaska Airlines incident.
Barclays analysts noted that grounding the planes would have only a “small financial impact” because the Max 9 fleet was relatively modest, with 215 planes, of which 144 operated in the United States.
The Max 9 only represents 2 percent of Boeing’s order book, analysts noted. Alaska has orders for 27 Max 9 aircraft and United has seven.
Analysts at Williams Blair said falling Boeing shares were a buying opportunity. “While the Alaska Airlines door stopper accident was terrifying,” they wrote, “we do not believe it will have a significant financial impact unless another incident occurs after the aircraft returns to service.”
A Morningstar research report agreed that the impact would not be “material,” but noted that “the dramatic nature of the failure will have the effect of once again calling into question customer stewardship of Boeing’s products. regulators and the flying public.
Mark Walker contributed reports.
