All 157 people on board the Ethiopian Airlines flight 302 died in the devastating crash, including eight crew members. While people around the world is mourning for the loss of these lives, American airplane manufacturing company Boeing faced intensive pressure on the company’s latest aircraft. The plane that crashed was a Boeing 737 Max 8. Despite being the top-selling jet for Boeing in recent years, it is already the second accident that happened within one year. Earlier in 2018, An Indonesian Lion Air owned Boeing 737 Max 8 crashed into the Java Sea shortly after taking off.
The incident had a significant impact on Boeing’s stock price. On Monday, Boeing suffered from a straight 6.5 percent drop on its stock price, causing the company losing more than $16 billion worth of market value. Dow Jones was also heavily affected and has consequently lost more than 300 points.
Investigations are still ongoing, and officials have yet to release any further results on the cause of the plane crash. However, several agencies and governments around the world have acted in precaution. Ethiopian Airlines has ordered all company owned Boeing 737 Max 8 to be grounded until further notice. And in China, government authorities have also grounded all Boeing 737 Max 8 jets indefinitely.
However, other airlines are yet to take the grounding approach. Two Canadian airlines, Air Canada and WestJet say they are confident in the aircraft and will work with Boeing to ensure the safety of the passengers. Canada’s minister of transportation, Marc Garneau says that he would board on a Boeing 737 Max 8 “without hesitation”. In a press conference on Monday, Garneau tells people not jump to conclusions as there are “dozens of different possibilities” that may have caused the incident.
Prior to the incident, Boeing was having significant growth over the past months. The company released its fourth quarter reports earlier in January. Boeing’s revenue reached 28.3 billion US Dollars in the 2018 fourth quarter. Its strong performance in the past quarter has pushed the projected revenue in 2019 to 10.95 to 11.15 billion dollars. Before suffering from the stock price plunge on Monday, Boeing’s share price increased from 323 dollars to 440 dollars at its recent high.
Despite hearing tragic news from time to time, airplane remains to be the safest travelling method. Yet statistical results do not appease the concerns and speculations that the general public has on Boeing and the 737 Max 8 jet involved in not one, but two deadly accidents.
The stock decline for Boeing may not be an end to the story. If there are other countries following the steps of grounding 737 Max 8, the company’s future in the business will be significantly compromised. Furthermore, investigative reports may include information that is against the company. Should there be any issues with the 737 Max 8 aircraft, Boeing’s reputation in the industry would be irreversibly hurt consequently.
Featured photo credit to TheDrive