Boeing Sinks on Report that New Delays Could Keep 737 Max Grounded into Holiday Season | Financial Buzz

Boeing Sinks on Report that New Delays Could Keep 737 Max Grounded into Holiday Season

Shares of Boeing Co. (NYSE: BA) opened about 3% lower on Tuesday after the Wall Street Journal reported that the 737 Max may not return to service in time for the holiday travel season.

The aerospace giant’s latest roadblock stems from a briefing in August that was cut short by U.S. and international regulators who criticized Boeing’s ability to provide technical details and answer specific questions about modifications to the Max jet’s Maneuvering Characteristics Augmentation System (MCAS), which includes a series of sensors designed to automatically adjust the nose of the plane.

In a statement on August 30, the Federal Aviation Administration (FAA) said an international panel of safety technicians is continuing to document its findings and observations regarding the airliner. The Joint Authorities Technical Review panel is expected to submit its recommendations in the coming weeks.

The 737 Max, involved in two deadly crashes within five months, has been grounded worldwide since March as the FAA continues to evaluate the aircraft. The agency has repeatedly expressed it is in no rush to certify the aircraft for return. “The FAA continues to follow a thorough process, not a prescribed timeline, for returning the aircraft to passenger service”, it said last week.

In response to uncertainty surrounding the 737 Max’s timeline for returning to service, airlines have continuously extended flight cancellations involving the jet. American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL) have both scratched the 737 Max from their flying schedules until December. Southwest Airlines (NYSE: LUV) in July said it won’t fly the Max until next year.