The share prices for Boeing moved in the negative direction in the latest session. The pre-market trading session was not a good sight for Boeing investors.
The company’s shares moved downwards as the executives provided an update on one of their largest delivery orders. The largest planemaker notified the shareholders that it had suspended the deliveries for one of its largest orders.
787 Dreamliner Delivery Suspended
The officials at Boeing recently provided information about the 787 Dreamliner order. They revealed that they have suspended the deliveries for the mentioned planes.
For now, the delivery suspension is indefinite so they cannot confirm how long it is going to stay. The suspension has been placed due to the safety checks that are yet to be conducted.
According to the officials, the safety checks are going to take longer than expected. It is a very critical order that they are processing and they do not want to leave any flaws or errors behind.
To deal with any potential errors or quality-related issues, they have extended the safety checks.
Just to clarify, it is not the Boeing officials that have announced the suspension from their end. It is the Federal Aviation Administration (FAA) that has reportedly ordered the planemaker to suspend the delivery.
Scrutiny against the Planemaker
In the past couple of years, Boeing came under a great amount of fire and trouble as it faced several quality-related issues.
Several planes readied by Boeing had several manufacturing defects that forced the planemaker to ask the airline companies to ground all of them.
Many Boeing planes got involved in several incidents where one of the planes had its body parts falling off during its flight. It resulted in caused a great level of damage to the city it flew to and raised many concerns among the concerned regulators.
Since then, the planemaker has faced a lot of scrutiny and is under the microscope. Now, as the company has started to make a recovery in terms of its planes, the FAA is not letting it go that easily.
According to the FAA, the planemaker will need to go through multiple tests and checks to address several issues. One of the major issues that they have to address is the fuselage component.
As per the regulator, these issues first have to be addressed before Boeing can start delivering the aircraft it has been manufacturing.
The FAA is specifically demanding Boeing to ensure that the checks are carried out for the aircraft with wide bodies and that the 787 Dreamliner planes meet the profile.
Boeing’s Major Deal
It was the beginning of February when Boeing announced that they had signed a major delivery deal. The deal was signed with Air India, which was worth an extremely high amount.
The officials at Boeing had revealed that the deal was signed for $34 billion. Air India is currently the largest carrier in India and as part of the deal, it was to acquire 20; 787 and 789 Dreamliners.
It was agreed that the company may add 20 more aircraft from the same category in the future. This is the reason why an option was added to the deal.
The deal had even caught the attention of the highest level of administration in the United States. Even Joe Biden remarked on the deal that had been formed between the two countries.
According to his words, it was a historic agreement formed between two countries and two major companies.
With such a large project in the process, the US would have a great influx of jobs, mainly for engineers and labor.
As a result of the latest developments, a stop has been placed in the agreement and the shareholders are not happy about it.
As the reports came in, the share prices for Boeing recorded a 2.6% dip. With a significant drop in the share prices, the stocks for Boeing are now trading at a low of $202.70 per share.
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