TEHRAN (Iran News) – US aerospace company Boeing said on Wednesday it expects the total cost of the 737 Max grounding to exceed $18 billion, more than double its previous estimate, as the company struggles to contain the crisis from the grounding of its flagship plane following two crashes.
New Boeing CEO David Calhoun reported a loss of $636 million on $76.6 billion in revenue for all of 2019, its first annual loss in more than two decades as it grappled with the fallout from the grounding of its bestselling jet.
Boeing also indicated it would cut production of its bigger 787 Dreamliner aircraft.
Boeing added another $9.2 billion to charges for concessions to airlines that have canceled thousands of Max flights and higher costs related to compensation, doubling its estimate of the total financial hit from the crisis to $18.6 billion.
The Boeing 737 Max crisis started last March after two crashes within five months killed 346 people in Indonesia and Ethiopia.
The crisis torpedoed sales and deliveries of new jetliners, leaving Boeing far behind rival Airbus. It caused a shutdown in Max production, layoffs at suppliers, and led to the firing of CEO Dennis Muilenburg.
US airlines that own Maxes – Southwest, American, and United – don’t expect it back until after the peak of the summer travel season.
Boeing has been embarrassed in recent weeks by the disclosure of years-old internal messages in which test pilots and other key employees raised safety concerns about the Max, even saying they wouldn’t put their families on it, while the plane was in development and testing.
Calhoun called the messages “horrible” and criticized company leaders who didn’t disclose the messages right away. He said board members were kept in the dark.
- source : PressTV, Iran News
