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  • Writer's pictureJonathan Anderson

Turbulence Ahead: Boeing's Harrowing Start to 2024

When you think you're having a bad start to the year:

On January 2, 2024: Boeing trading as “BA” on the NYSE had a closing stock price of $251.76*. It was the morning the CEO woke up, had a cup of expensive Arabic Coffee, went to a yoga class, had sushi for lunch and then…the following events took place. 

On January 5, 2024: A door plug on Alaska Airlines flight 1282 came off mid-flight. The plane was a Boeing 737 Max 9. The flight was full, and the cabin was instantly subject to depressurization. Nobody was injured in this incident however the plane in question was due for inspection that day and it skipped the inspection to take this flight. The incident occurred after market hours. On the morning of January 6, 2024, the stock price opened at $228.00 a 9.4% decrease. "This incident should have never happened and it cannot happen again," the FAA said at the time.

An image from the NTSB investigation shows the interior of Alaska Airlines Flight 1282 on a Boeing 737 Max 9, which suffered a violent explosion when the aircraft lost a door plug during a commercial flight. NTSB

On January 9, 2024: Alaska Airlines and United Airlines did closer inspections of a sample 737 Max 9 and both companies found loose hardware during the inspection. The reports were released to the public on January 12, 2024. At this time, the stock had slid slightly lower closing at $217.70 an additional ~5% bringing the yearly decline to 13.8% over 9 trading days to start 2024. 

On January 12, 2024: The FAA said it will be auditing Boeing Production

On January 16, 2024: 4 passengers on the January 5th flight sued Boeing Airlines. Closing stock price of $200.52 an additional 7% reduction since the beginning of 2024 bringing the total to just over 20%. 

On January 24, 2024: The FAA clears Boeing to resume flights. The stock closed up 2.5% to $205.47.

On February 6, 2024: Two events occurred this day: First, the FAA/NTSB agreed that safety bolts were missing on the Boeing flight that was examined; later, A United 737 Max 8 experienced a stuck pedal during landing -- No one was injured. The Stock Closed at $208.58 a ~4.0% uptick during the period from January 16-February 6.

On February 21, 2024: Boeing executive Ed Clark who oversaw the 737 Program resigns from his post. The Stock closed at $201.57, losing 4% since the FAA said planes were safe to fly on. 

On February 28, 2024: The FAA gives Boeing 90 days to become organized and produce a plan. At the same time, individuals are coming forward stating there were lapses in safety regulations. The primary individual being John Barnett, former quality control manager. The stock closed at $207.00 up 2.5%. FAA Administrator Mike Whitaker Stated “"Boeing must commit to real and profound improvements, Boeing must take a fresh look at every aspect of their quality-control process and ensure that safety is the company's guiding principle." 

From March 4-6 2024: The FAA audit slams Boeing after 6 weeks and “found multiple instances where the companies allegedly failed to comply with manufacturing quality control requirements." The FAA cites problems in numerous areas, including "manufacturing process control, parts handling and storage, and product control.” The stock closed on March 6 at $201.00 down 2.5%. 

March 6-11 2024: These 5 days are some of the worst for a PR nightmare a company can achieve. 

  • The FAA found that Boeing was not being helpful in providing documents necessary for the investigation. Boeing claims to have lost the documents related to the faulty door as per Ziad Ojakli, Boeing’s EVP of government operations, “...employees looked extensively but could not find any documents on the opening and closing of the door plug." 

  • The whistleblower John Barnett was found dead in his car of a gunshot wound to the head. This is after a note was found from John stating if something happened, he would not kill himself. 

  • A tire falls off a United Aircraft after takeoff.

  • 50 Passengers were injured when a Boeing 787 Dreamliner dropped mid-air and made an emergency landing in New Zealand. 

March 12, 2024: United Airlines tells Boeing to stop building the remaining orders of the 737 and they will be switching to an Airbus Variant. 

The stock price at the end of that week $181.14 a 27% decline from the beginning of January 2024. A total market cap hit of ~$45BN. 

These events have culminated to see 9 executives throughout Boeing lose their roles via resignation or termination and it culminated March 25th with the ouster of Boeing Commercial Airplanes CEO Stan Deal, Larry Kellner the Chairperson of the Board and Boeing CEO Dave Calhoun resigning at the end of the year. 

So……. if you think your 2024 is off to a bad start, feel free to start at the top of this article. 

*All monetary denominations are in USD

Jonathan Anderson is a contributor for Degen Magazine. His interests lie in real estate, the economy, cooking, interesting things, and the market. Follow him on Twitter for more: @I_am_stockchef

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