Boeing reports huge declines

Manufacturer reaches new financial lows amid historic safety crisis.

Boeing reached new financial lows in 2019 as the 737 Max — a once-promising line of commercial jets whose flawed control systems played a role in two deadly crashes — remains at the center of a historic safety crisis with no end in sight.

Boeing closed out the fourth quarter with $17.9 billion in revenue, the company announced Wednesday, a 37% decline from the fourth quarter of 2018.

The company’s 2019 net losses of $636 million mark its first annual loss since 1997.

The losses stem from the continued worldwide grounding of Boeing’s Max jets and a production halt this year in the wake of two fatal crashes. On Wednesday, the company incurred another $2.6 billion in costs related to the indefinite grounding, and it expects the grounding to cost it an estimated $4 billion throughout 2020, something that should put a drag on future results.

The company’s stock price has lost about 13% of its value over the past year at a time when the market has surged.

“We recognize we have a lot of work to do,” Boeing President and CEO David Calhoun said in a statement. “We are focused on

returning the 737 MAX to service safely and restoring the long-standing trust that the Boeing brand represents with the flying public.”

Once a cash-generating machine that was the envy of its competitors and a darling of Wall Street, Boeing has been forced to borrow billions of dollars to cover the cost of building airplanes it can’t deliver to customers.

Boeing has been forced to compensate airlines for the cost of flight cancellations, taking a $5.6 billion charge in July. And a bruising congressional inquiry has pointed to deeper problems with the company’s management culture, leading to the ouster of its two highest-ranking executives.

The 737 Max has been out of commission for more than 10 months as regulators remain unconvinced it is safe to fly. It was grounded in mid-March when the Federal Aviation Administration recognized similarities in a pair of deadly plane crashes in Indonesia and Ethiopia, both of them involving new 737 Max jets, that killed 346 people.

Boeing later admitted that a new flight-control program, interacting with bad data from the planes’ external sensors, had in both cases pushed the jets into an uncontrollable nosedive.

The FAA has made the jets’ return to the sky contingent on a set of software and display changes designed to prevent the same problems from occurring again. But the timeline for approval has continually shifted over the past year.

LINDSEY WASSON / NEW YORK TIMES Boeing’s steep financial losses stem from the continued worldwide grounding of its Max jets and a production halt this year in the wake of two fatal crashes.

MIKE SIEGEL / SEATTLE TIMES / TNS Boeing has been forced to compensate airlines for flight cancellations, taking a $5.6 billion charge in July. The 737 Max was grounded in mid-March.