Boeing shares tumble as parts issue halts deliveries of some 737 MAXs
Boeing Co’s (BA.N) shares fell 6% in premarket trading on Friday after the U.S. planemaker halted deliveries of some 737 MAXs due to a new supplier quality problem by Spirit AeroSystems (SPR.N).
Spirit, which manufactures fuselage, thrust reversers, engine pylons and wing components for the 737 MAX airplanes, slumped 14%.
The latest quality issue pertains to a fuselage fitting supplied by Spirit and is believed to date back to 2019, Boeing disclosed on Thursday.
“I don’t know if there’s a long term concern about the 737s for Boeing….” said Art Hogan, chief market strategist at Riley Wealth.
“We have known for quite some time that there was going to be a financial cost at Boeing in getting their house in order. What we didn’t know was how many of these 737s they were going to be able to deliver and it sounds like it’s even more than we estimated.”
Boeing warned that the issue will likely affect a “significant” number of undelivered 737 MAX airplanes both in production and in storage, and could result in lowered 737 MAX deliveries in the near term.
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