Boeing delays 737 Max return until mid-2020
New York, US – Boeing has officially pushed back the timeframe for the 737 Max to return to the skies, sending shares plunging and overshadowing an earlier announcement of a first flight of the delayed 777X plane.
Boeing said it is now targeting the return of the grounded Max ‘during mid-2020’, the latest delay in the schedule for the troubled jet, which has been grounded since March following two deadly crashes.
Boeing is in the process of raising at least US$10bn from Wall Street banks to cover costs connected to the Max crisis, bank sources said Monday.
Boeing has told customers and suppliers ‘that we are currently estimating that the ungrounding of the 737 Max will begin during mid-2020’, the company said in a statement.
That marked a shift from Boeing’s most recent stance on its top-selling aircraft when it eliminated a target date entirely after repeatedly failing to keep to timetables in 2019. But even the vague mid-2020 target is later than some analysts had expected and it probably represents a best-case scenario that could again be pushed back.
The US Federal Aviation Administration (FAA) had publicly criticised Boeing for continually touting its aggressive timeframe in public for the Max’s return, suggesting the target was a tool for pressuring the agency into approving the plane more quickly.
On Tuesday, an FAA spokesman reiterated that it has set ‘no timeframe’ for the Max’s certification. ‘We continue to work with other safety regulators to review Boeing’s work as the company conducts the required safety assessments and addresses all issues that arise during testing,’ the FAA said.
Meanwhile, Boeing is seeking some US$10bn in loans to deal with swelling costs for the Max which have reached US$9.2bn based on company disclosures thus far. But the number is expected to rise when the company reports earnings later this month.
Boeing’s Max bill includes compensating airlines for delayed deliveries and lost service on thousands of Max flights, paying out legal settlements to victims, storing and maintaining hundreds of Max planes that have been built but not delivered and managing costs across the Max programme during the period before Boeing halted output completely.
President Donald Trump on Wednesday criticised Boeing as a ‘very disappointing company’ because of the aerospace giant’s recent problems after the grounding of the 737 Max plane, which he said had a knock-on effect for the US economy.
“This is one of the great companies of the world, let’s say as of a year ago, and then all of a sudden things happen,” Trump said in an interview on CNBC from the Davos economic forum in Switzerland.
This ‘had a tremendous impact. You know, when you talk about growth, it’s so big that some people say it’s more than a half a point of GDP. So Boeing - big, big disappointment to me’, he said.
Grounded Boeing Co 737 Max airplanes are seen parked in a lot near Boeing Field in Seattle, US