Boeing announced that it has lost at least $1billion in just a month following the crash of Ethiopian Airlines Flight 302.
The Chicago based company says the loses have mainly come from the grounding of their 737 MAX 8 aircraft last month.
In the wake of two deadly crashes of its 737 MAX 8 aircraft in 5 months, regulators around the world grounded the aircraft once the similarities between the two crashes started to emerge.
One of the most popular aircraft in the world, the 737 MAX 8 has been grounded for a little over a month and the financial toll on Boeing is starting to show.
Ahead of an earnings calls with investors, Boeing announced that the initial financial toll of the company’s balance sheet tops $1 billion and that the company’s financial forecast needed to be withdrawn until the full extent of the losses from 737 MAX 8 crisis are better known.
The company has also announced that they would be halting stock buybacks for the time being.
“Across the company, we are focused on safety, returning the 737 MAX to service, and earning and re-earning the trust and confidence of customers, regulators and the flying public,” Dennis Muilenburg, Chairman and CEO of Boeing, said in a statement.
Meanwhile, Boeing was sued early this month by one of its shareholders for allegedly hiding problems with its 737 Max jet to push its shares higher.
Shareholder Richard Seeks argues that Boeing should have told investors about safety problems with its best-selling plane after a fatal crash in October. Instead, it pushed the stock up to artificial highs by speaking optimistically about future sales before a second fatal crash in March sent shares tumbling, he says.
The company misled investors “by touting its growth prospects and profitability, raising guidance, and maintaining that the Boeing 737 MAX was the safest airplane to fly the skies,” the lawsuit alleges.
By doing so, investors bought shares at “artificially inflated prices.”