Travel industry analyst Henry Harteveldt discusses how travelers will be affected by Boeing grounding its 737 Max jets.
Abandoning its full-year financial forecasts as a effect of the disruption, Boeing said the guidance "does not reflect the 737 Max impacts ... due to the timing and conditions surrounding the return to service of the 737 Max fleet". Sales fell 2 percent to $22.9 billion. The aeronautics giant reported that earnings from operations dropped 18 percent, while per-share profit landed at $3.16, in-line with analyst expectations.
Boeing said Wednesday that costs tied to the global grounding of its 737 Max plane jumped $1 billion in the first quarter. The company has said it's working to fix a software issue that may have contributed to the tragedies.
The world's largest planemaker is facing one of the biggest crises in its 103-year history following the disasters on Lion Air in Indonesia on October 29 and another on Ethiopian Airlines on March 10, which together killed all 346 on board.
The 737 Max fleet remains grounded and new deliveries are suspended.
The company now declines to say if it can still reach that goal.
Last week, an expert panel of the Federal Aviation Administration judged that a software fix to the Max would be "operationally suitable", and that airline pilots familiar with previous versions of the 737 won't need additional time in flight simulators to learn about the new software that is unique to the Max.
Boeing's core operating earnings in the first three months of the year were 21% lower at nearly $2bn, reflecting a one-third drop in deliveries of the Max 8.
The company announced earlier this month it was cutting monthly production of the 737 by about 20 percent. They are still down about 10 percent since the Ethiopian Airlines crash, wiping nearly $25 billion off the company's market value. The accidents have damaged the company's reputation for safety, caused the worldwide grounding of about 370 Max jets, and raised questions about the USA government's approval of the plane in 2017.
The fallout of a second deadly crash within months in March has seen Boeing cut production of the jets to 42 aircraft per month, down from 52, and its operating cash flow in the first quarter was around $350-million lower than a year earlier. Boeing shares, which rose 2 percent ahead of the start of trade on Wednesday, are up roughly 13 percent this year as investors bet those concerns will eventually subside.