Boeing’s MAX 9 Grounding Busts Previous Momentum, Raises More Questions About Other 737 Variants

Boeing shares were rocked this morning by yet another component malfunction aboard a 737 MAX jet, which caused a panel to be torn off of the aircraft mid-flight. Hundreds of MAX 9s have now been grounded until an investigation and inspections of these planes can be carried out by the NTSB and FAA. This could cost MAX 9 fleets, operated by United Airlines, Alaskan Airlines, and others, thousands of flight hours.

The now infamous MAX family is Boeing’s top-selling model of plane, comprising a massive share of the company’s backlog, but has been almost solely responsible for the company’s consistent underperformance since 2019. The American aviation giant had just begun picking up some momentum in the final quarter of 2023, but this latest debacle is unwinding some of the gains company shares have seen in recent months. Confidence among regulators may be further diminished just as Boeing has sought out an exemption from key safety standards for its still uncertified 737 MAX 7 jet.

Related Stocks: The Boeing Company (BA), Airbus SE (EADSY)

Prior to last Friday, Boeing appeared ready to start the new year on steady footing, building on a wave of momentum it had built up throughout a relatively successful Q4 2023. Deliveries for the month of November reached a five-month high and put the American aviation giant on track to reach full-year targets related to its 737 and 787 jets. Though Boeing’s tally of new orders will certainly lag European rival Airbus’s pace for a fifth straight year, with the former trailing by roughly 800 aircraft through the first 11 months of the year reported, 2023 will still be the best annual period for Boeing’s order book since 2014. All of this helped Boeing shares surge by 39% throughout the fourth quarter.

However, Boeing’s recent run has collided with another round of safety and production issues, following the mid-air blowout of a panel aboard Alaska Airlines Flight 1282 on January 5. A door plug, meant to seal unused exits on certain flight configurations where they’re not in use, apparently fell off of the 737 MAX 9 jet, leaving a gaping hole in the plane’s fuselage. Reuters notes that the specific MAX 9 in question entered service just eight weeks ago. Though no passengers or crew were injured in the malfunction and the Alaska Airlines flight landed safely, Boeing’s stock price sunk by more than 8% at the start of trading this morning.

The Federal Aviation Administration (FAA) has grounded 171 of the 215 MAX 9 jets currently in service until inspections can be done to assess their airworthiness. With such inspections taking…