The setbacks for Boeing stock continue.
The National Transportation Safety Board on Tuesday said its investigation into January's Boeing 737 Max door plug incident revealed missing bolts.
After a Jan. 5 Alaska Airlines flight lost a door plug mid-voyage, news of the near-catastrophe hit Boeing stock. Shares have dropped nearly 15% since the incident.
The action also means Boeing has now given back all the gains it made since mid-November 2023. Shares have been on a roller coaster to nowhere for the past several years, significantly underperforming the S&P 500 since peaking in March 2019.
Boeing stock ranks poorly vs. its peers at No. 35 in the Aerospace-Defense industry group, according to IBD Research. The stock has an IBD Composite Rating of 57 out of 99.
In the preliminary report, the NTSB said "four bolts that prevent upward movement of the [door] plug were missing before the [door] plug moved upward." The NTSB says its investigation into the incident is still ongoing.
Boeing Responds To NTSB Findings
In a statement to Investor's Business Daily, Boeing says it plans to review the NTSB's findings and will continue to cooperate with its investigations. The company says it is taking additional measures including further inspections, launching independent assessments and opening its factory to customers for reviews.
"Whatever final conclusions are reached, Boeing is accountable for what happened," Dave Calhoun, Boeing President and CEO, said in a statement. "An event like this must not happen on an airplane that leaves our factory."
The door plug incident took place on a Boeing 737 Max 9, a plane from the same family of Boeing planes involved in two fatal crashes within the last six years. This most recent incident draws renewed scrutiny to the Max family of aircraft.
Boeing Goes From The '60s To The Max
The 737 Max series of midrange planes includes the 7, 8, 9 and 10 series, and together they make up the fourth generation of Boeing's 737 design. To update the 737, which first flew in 1968, Boeing included innovations like larger, more efficient engines and computer systems like MCAS (Maneuvering Characteristics Augmentation System) to compensate for the plane's new weight distribution.
The Max family of planes was born out of competition. In 2011, perennial rival Airbus pitched airlines with a midrange Boeing competitor that eventually became the A320neo. To compete, Boeing scrapped early plans for a "clean sheet" design that would have been both costly for the plane-maker and taken years to design, test and certify. Instead, Boeing put together a proposal in 2011 that made improvements to its existing and successful 737.
While Boeing's decision to use an existing airframe helped the plane-maker bring an offering to market sooner with a fraction of the development costs, its revisions also created new problems. Investigators concluded the MCAS system directly contributed to the two fatal crashes in 2018 and 2019.
Boeing Stock Takes A Hit On 737 Max Problems
In 2020, Boeing stock tanked to lows not seen since 2013. The two fatal incidents combined with a halt to air travel caused by Covid-19, slammed the plane-maker. Shares have since recovered, but remain far below their 2019 highs.
The most recent incident, the door plug blowoff, fueled a sell-off from December 2023 highs, although the losses are not as significant as those Boeing stock endured in 2020.
