Boeing down sharply second day in a row. Airbus stock in similar decline

By Scott Hamilton

March 12, 2020, © Leeham News: Boeing stock is in another sharp decline today.

Yesterday, the stock fell 18%, to close under $200 for the first time since May 2017.

Today, the stock was off 15% in early morning trading, to a low of $156. At this writing, Boeing is down 13.5% at $163. The Dow Jones was down 7%.

Year-to-date, Boeing is off 52%.

While here in the US, focus is on Boeing, looking at the Paris stock exchange, Airbus stock also in in a similar decline—without all the baggage Boeing has.

Year-to-date, Airbus is off 45%. It’s off  14% today. Although not as volatile as Boeing’s stock, the illustrations show a remarkably similar trading pattern.

96 Comments on “Boeing down sharply second day in a row. Airbus stock in similar decline

  1. The perfect storm…

    All those orders are not going to be worth a penny if the airlines are insolvent. All the contingency planning in the world becomes null and void in the event that your customer base evaporates.

    • The major airlines are ‘too big to fail’, so theres no deep concern there. Doesnt apply to all the little guys , including overhaul shops etc

      Boeing is going to have to pull out of the Embraer deal, and shepherd that nearly $5 bill in cash for its 777X development , Max return to service and the NSA development on slow burn.
      The big worry also is when planes already in production are ready
      to be delivered, will the airlines find the money to pay Airbus and Boeing through the normal methods of loans and leases ?

  2. From Boeing’s perspective, hard to think of a more inopportune time for the airline industry to fall on hard times. It’s going to be tough sledding for those guys.

    • For Boeing , the slow Max production ramp up once restart is given the go ahead will be now seen as a silver lining, as the customers that were expecting planes will be happy to defer.

      • No silver lining here. Airlines will go broke. That is good for no one.

    • Evaporation of urgent demand takes pressure from Boeing.
      ( at least in relation to Airbus. They now share the hurt )

      In a way similar to the GFC and the majorly delayed 787.
      Boeing could not deliver but airlines also shew a reduction in urgently needed frames. All parties at the time were happy with deferrals/upgrades to a later type.

  3. Cancellation of all USA -EU trips is not going to help the airline industry and the economy, that such a ill-advised decision!

    • Cancellation of ALL US -Europe travel was one of two Trump blunders he made reading from the teleprompter

      White House had later to correct , that US citizens and permanent residents werent included in ban as they can come and go as they like , but not surprisingly huge numbers made a dash to the airport in Europe.

      As well Trump said “his ban would apply to “the tremendous amount of trade and cargo” between the U. S. and Europe.”

      This was later ‘corrected’ by the White House as not applicable . Gee Trump is live spreading fake news

  4. This is a medical crisis that is impacting financial world.

    While its going to be bad medial and serious finally, the basics are there for a huge bounce back when it either is under control or the high mortality group gets hit and the world moves on.

    As bad as he Spanish Flu was, the world moved on.

    Losses to individuals does not doom the economy though they have a terrible impact on families.

    6 months to a year and things on the economic area start a swing back up.

  5. Right now, all World’s resources are focused on overcoming the COVID-19 epidemic
    That will take time and effort

    But we need to have hope in a brighter future, as our forefathers did before us

    • Let’s be honest, China did a great job getting Covid-19 under control. S Korea are doing well too. While some say they were slow responding at the start they didn’t know what they were up against. In the end I think governments will end up bailing out the airlines. If all the LCCs which are only just hanging in there fail, elected officials will have to answer to voters for the fare hikes

      • They may have got it under control, but they also created it, not deliberately as part of biological weapons research, but by some of the practices and customs their Government allows.

          • I travel deep into the place frequently, I see what goes on. We know flu pandemics almost always come from this part of the world and I’ve seen the animal practices and treatment. One of the first things I noticed about this pandemic was that folks with a certain, shall we say left ideological mindset, rushed to hide the underlying pattern as a first priority thereby yet again preventing measures that could break the pattern. Incidentally, you’ve provided a Wikipedia link to the World Military Games. You make some good points, occasionally.

  6. Looks like Boeing May be flirting with outright disaster. At what point are airlines committed to take the plane? And are A/B seeing customers step back at this point? I feel like the world economy is in a dive and we’re reaching the point where we can’t pull out of it.

    • Keep in mind, once the C-19 impact is over, the fundamental economy is still there.

      Deal with C-19 and then the recovery will be rapid. There will be a huge demand to deal with.

      Airlines will lag and may delay but long term the planes will be needed.

      • No denying it but the longer there exists this panic all over, the more of a real possibility it does damage to the “real” economy that will take longer to correct. The sooner people start to get back to rational the better it will be for recovery.

        • Agreed, its all a guess and only find out when we come out the far end of the tunnel.

          But Congress can start now and revoke tax cuts that were wasted and put the money into infrastructure which has a huge impact on the immediate and long term economic health both.

          Starting infrastructure right now might in fact work as its not a gathering type activity and can go on despite the issue.

          That in turn boost mfg of construction equipment, concrete. steel, electronics and a lot of other areas.

  7. I bet Boeing brass is thrilled with their decision to buy back more than $40 billion in stock over the last half decade. Sure would be nice to have some of that cash on hand now. Fools.

  8. Yes, some interesting “business continuity” teams running around some of my customers right now.

    Chinese Flu entailed crucifixion! I love the revisionism going on. Stalin would be proud. Stick to trusted news sources. Avoid fox fiction.

    It gives BA cover to remove the dividend. Won’t be sued.
    But any immediate backlog pressure is gone for 12-24m.
    The carnage will be deep. This is not a seesaw dip and back up.

    • I agree on the 12 – 24 month as it will lag.

      I disagree that it won’t tip back up and quickly. China is settling down and in recovery. Korea is handling theirs well and case increase is going down.

      Once they are confident, then we can get the test kits from them we lack (so much for Western superiority!!!!!_)

      Slow it down and then manage it. A leadership change in the US would help hugely.

      • [Edited]. One will never know the true costs of the pointless distractions to the federal government.

        • Hollowing out the CDC for ideological reasons plays a role. About 43% federal budget reduction in the past 3 years. Sure, its from the NYT… revisionists will object to the data.

          Very material reductions for the NIH too — but i do not recollect the figure.

          I see people getting massively tested in Korea, Germany, France, etc. How did we miss this so bad here? Where are the tests???
          They have drive through testing in Germany/France… imagine.

          Many, many airlines will not survive. Only state intervention will rescue some.

        • All types of disparaging comments on Trump are allowed on the board but as soon as Pelosi and the recent kangaroo court she presided over is mentioned it is censored. Scott – is it fair to assume you are a registered Democrat?

          • @Old:

            First, I have a real job and moderating this blog is on an as-time-permits basis.

            Second, I don’t remember seeing comments about Pelosi, though as noted above, I may have missed them.

            Third, I try to edit non-pertinent political comments regardless of the leaning.

            Fourth, on this post there is also one defending Trump and criticizing Trump Derangement Syndrome.

            Fifth, my politics are none of your business.


    • I always find amazing the churlish trump derangement syndrome shamelessly displayed by posters (who don’t usually have a point) which often comes along with a dose of anti Fox News ranting. I don’t trust them either but the 5 other major media corporations are in every way disseminators of fake narratives that are more deliberate. It seems at times they only tell the fair facts occasionally so as to establish enough credibility for the next round of “narrative”. Take a look at your own glass houses.

      • IvoryCoast and William, ratchet it back on the political/media commentary. Not pertinent to this post.


        • Agreed. Let’s keep politics out of this. Make the Message Board Great Again!

  9. This is a short-term thing, based on results in China (roughly 1 month between significant rise and significant drop in cases).–20_coronavirus_pandemic_in_February_2020#/media/File:2020_coronavirus_patients_in_China.svg

    The virus will move though a small percentage of the population, then will fall off. Most people will not have a serious illness. The real challenge will be to help & protect those whose immune systems are compromised. They are the people at risk.

    In the meantime China is now a source of vaccine development since they have a large population who have developed resistance.

    Governments will act to preserve liquidity in the short term, to maintain business continuity and the health of the economy. This is an easier task than in other crises, because we know the duration will be limited.

    • I would say that is wrong. China did it on draconian and had solid leadership once they got their feet under.

      Germabny is predicting upwards of 70%.

      South Korea hit it aggressively with good leadership and got way ahead with good test kits.

      The US does not even have a pathetic level of test kits, its going to hit bad and worse. At best leadership was in total denial and they is still behind the issue. Blaming China when that is not relevant to dealing with the issue.

      Killing European travel exempt to the UK, Scotland and Ireland where the president has golf courses. Oh, and the UK has 400 cases and open travel to the rest of Europe.

      We had a chance to get ahead and it was squandered. Not its trying to catch the races horses after they have bolted the barn.

      • TW, the FDA has given permission for hospitals and universities to develop their own tests. Many research facilities in the US have their own genetics programs and so have the resources to do this. The CDC messed up their own development as they tried to make the test too broad, but that will soon be corrected.

        The university I work with already has their own test and has deployed it to their affiliated hospitals, so patients coming there will get the needed tests. Their labs are working overtime but are also highly automated, and have ordered new testing machines.

        A lot of resources and resourceful people in the US, they will not stand around waiting for the government. People will get the care they need, initially in the city centers but then rapidly spanning out into rural areas.

        Also the vast majority of infections are asymptomatic or have minor symptoms, as I said the real risk is spreading to people who cannot fight off the infection. It’s actually more cost-effective to put protections and additional care in place for those people.

        • The French and British leaders both gave blood curdling breifings yesterday, the US seems to be out of step.
          Check out professor Graham Madley talking about herd immunity on BBC newsnight 12/3/20,this is the clearest explanation I have heard. If the USA couldn’t avoid mass infection in 1918 I can’t see how it will be able to to buck the trend now.

          • Grubbie

   makes a very good argument. We should stick to the science, and leave emotions out of it.

            “Act like you’re infected, not avoiding infection. Wash your hands like you don’t want to transmit it. Think about your contacts – do you want to infect them?”

            Experts will be watching the data to see if infections start to spike again as China comes out of lockdown, that may well make the case for herd immunity.

            Boris Johnson isn’t making these decisions on his own, he’s got some very good scientific advisors !

            More information about the Scientific Advisory Group for Emergencies (SAGE), and SPI-M here:

            If you want to know what difference washing your hands can make, have a look at Dr Hannah Fry’s post at
            From the TV programme ‘Contagion: The BBC Four Pandemic’ 2018

          • Rob:

            As Napoleon said, “you can ask me for anything but time.”

            We have lost 6 weeks of never to be got back time.

    • Some scientific studies indicate that the peak will be next winter in the northen hemisphere. Also this may well become an annual seasonal feature.
      A couple of days ago leeham published an article about European countries most affected and the effect on aircraft orders. My immediate thought was that the Americans just don’t get this. Let us pray that the president is listening to actual scientists.

      • This obvious has and is having enormous impacts on the Aviation sector be it the mfg end or the airlines end.

        Keeping as much politics as possible out of this, the President is simply knee jerking things unless he is coerced into it.

        Growing up when I made a mistake I was taught to admit it, correct it (various means employed of which some were quite nuanced) and then get on.

        But that assumes you even realized or accept you can make a mistake let alone admit it. No one and nothing is perfect. My folks as much as anyone, but they figured out where they went wrong and changed that so they did not repeat it.

        The hearing where the CDC head and NIH present and only Fauci answered, no one is in charge of test kits.

        That may have changed but its chilling this far in and its not all hands on deck including can we get those kits from South Korea or even China.

        If we can’t slow it down and it just flashes through, we are looking at 20 million deaths in the US.

        Once it flashes through the survivors can pick up and get going with a very heavy heart.

        And that can change if a vaccine can come through which also was unfunded and left hanging.

      • Trump wants to hire German vaccine scientists to produce vaccine exclusively for the US.

        Didn’t Trump say Germany is the enemy.

  10. Boeings supply chain has a big problem specially if you look to smaller suppliers.
    Some are under maximum tension concerning the 737 grounding and this earthquake will give them the rest propably.

  11. Airline stock is down, Boeing and Airbus stock is down, hotel stock is surely down and so would the travel agents be effected and anyone about to build a hotel or anyone involved in tourism. Expect global GDP to take a hit.

    One thing for sure is this must change the way the world behaves, treats and greets each other. In particular the way animals are treated and slaughtered. The wild meat trade must come to an complete end by forcible measures, markets must be closed, the folks that insist on treating animals that way, along with the Rhino horn smugglers can in no way be suffered to have their freedom. The costs are too great in a connected world. Now wash your hands.

  12. AIRBUS value as of today stock price 55mns €
    BOEING value 88mns $
    there is clearly Something wrong
    no LEEHAM reader will think that BOEING is worth nearly 50% more than AIRBUS
    End of April, when analysts eventually do their job, after receiving the Q1 figures we shall see that the king is naked!
    we were warned by M.CALHOUN, figures will be pretty ugly!
    and chartists will notice that we have a very classical “head and shoulders” pattern in the making.
    not good
    not good at all!
    go to the lifeboats….

    • Boeing is 50% military business and that is not going away. The KC46 is issue laden, but it will fill aircraft.

      Despite the down the Commercial end will recover its value if not at the pumped up levels of the past.

      Airbus is very small portion in military and airlines deferring will hit them as hard as Boeing (harder, Boeing was shutdown on the MAX already)

    • Agreed. With all the government subsidies and loan forgiveness Airbus receives. There is no way Boeing could be worth more than Airbus.

      • please substantiate “government subsidies”
        loan forgiveness, only for A380, and amount not that big…
        other loans, reinbursed many times A330 and A320
        overall, loans have been profitable for europe administration

        please also elaborate BOEING 50% military…
        if true, it means that commercial aircraft has gone down a great deal!
        and please analyse AIRBUS military, actually not that much smaller than Boeing….

        • Flying Frog:

          About 50% of Boeing’s backlog is (was, higher now) military contracts ans business areas.

          That ranges from the highlighted KC-46 tanker and T-7 trainer, but also a unmanned fueler for the Navy (small but possible bit) P-8, various fighters, missiles and KC-135 support.

          A large portion was picked up in the McDonald Douglas take over of Boeing.

  13. I wouldn’t agree with that entirely. After initial mistakes, China has managed to diagnose very well and contain the epidemic with drastic measures. It is difficult to imagine that the Western industrial nations could act with similar rigor. The USA does not even have the diagnostics. Mr. Trump confuses lack of diagnostics with control over the virus.

    • Can you really take Communist China’s government statistics at face value?

        • It really does not matter, China could take steps that the US can’t

          South Korea took steps that are in line with what we could do but have not, because of lack of leadership.

          The ship floats or sinks on that.

        • I do not agree China statistics are worse than the US or the EU for that matter.

          Greece cooking the budget numbers and taking advantage of the naivette of Germany which is dumb enough to bail them out again and again.

    • Chinese and S. Korean data differ a lot.
      IMHO Korean data is a lot more credible due to the sheer number of people tested (over 200.000) on population that’s 1/20 that of China’s. There also seems to be no pressure from the Korean government to mis/un report, unlike China (various claims of Chinese doctors given a quota of confirmed cases).

      According to Chinese data morality is around 1 in 30 and according to Korean data mortality is around 1 in 140.

      Korean data seems to suggest China is not diagnosing or not reporting by a factor of 4 (not exact), though that could be lower depending on how you rate the influence of the level of healthcare in both countries.

      It’s up to everyone to believe how much difference the higher level of healtcare in Korea makes.
      But I think it’s safe to say China has not diagnosed very well.
      And it’s still early to conclude if China has contained the virus very well.

      Note: my opinion is based on numbers from a couple of days ago, I’m not completely up to date (been busy with work), I’m open to correction.

      • The Chinese numbers are skewed by the massive outbreak in Wuhan (Hubei), where the healthcare system simply couldn’t deal with the number of cases — and probably many went unreported, too.

        Outside of Hubei province, there are currently 13,186 cases and 118 deaths, or under 1% mortality rate. That’s getting closer seasonal flu levels. Of course there may be numbers missing there, too, but it’s clearly not 3%+ everywhere in China.

        Diamond Princess is 1% mortality. Good medical care but the population skews much, much older than any given country.

  14. To anyone claiming, without qualification, that COVID-19 is a short term event that will soon pass, bear in mind that it is possible that there will be multiple waves. Unless and until an effective treatement is discovered and made widely available, to me the only reasonable timeline to put on an end to the event is the date when an effective immunisation has been widely provided, which talk suggests is unlikely before early 2021 at the earliest.

    So, do airlines anticipate multiple, untreatable waves and adjust operations to conserve cash at the lowest forecast operating levels and then forego any upward spike in safe periods, or are they actually sufficiently flexible to ramp back up and back down again, or do they plan on the basis of a single wave?

    As for Airbus, Boeing and the airlines, I’m sure they’ll be very concerned to see whether any widespread short term switch from face-to-face business travel to remote videoconferencing etc. actually proves sticky this time. I don’t see how this can fail to put a drag on fleet decisions (as airline operating models are re-assessed) and so model development and production at least a significant time past the immunisation stage.

    • Woody, the evidence suggests otherwise.

      The normal progression of a virus is a spike followed by buildup of natural immunity in the population. That would be true without additional measures. With measures in place, the spike can be “flattened” so it occurs over a longer period of time. That makes it more addressable with healthcare resources, and also provides time to examine and reproduce natural immunities in the form of a vaccine.

      We’re now in the “flattening” stage, with social distancing being the primary measure, but also ramping up testing, treatment and isolation until carriers are not infectious.

      Multiple waves may occur but will be less dramatic once some immunity is established in the population.

      There’s no reason to think that COVID-19 will not respond in the same way as other viruses. Nothing magical about it. The main difference is the rate of infection and spread allows it to reach at-risk populations more quickly and easily. We should be worrying about those populations and protecting them.

      • Rob, no it doesn’t. From the WHO ( “Previous pandemics have been characterized by waves of activity spread over months. Once the level of disease activity drops, a critical communications task will be to balance this information with the possibility of another wave. Pandemic waves can be separated by months and an immediate “at-ease” signal may be premature.” As happened with Spanish Flu.

        I have read discussions among people from a biological field concerning waves for COVID-19, which indicates waves are not restricted to influenza. Plus discussions about potential difficulties in vaccine development or level of immunity received through infection as the virus mutates, now apparently in 2 significant, different, lineages (referred to as L and S). Plus some mention of not knowing yet whether it may be biphasic (ie return after patient given all clear).

        In short, at this stage, more uncertainty than many appear convinced to be the case.

        • Woody, the comparison with the Spanish flu is really not valid. The Spanish Flu targeted younger people with strong immune responses. Many of them died from complications resulting from suppression of their immune systems. COVID-19 tends to target those with already compromised immune systems, like other versions of its family.

          Also 2020 is not 1918. Today we have good statistical tracking and so will know if there are additional waves, and can respond to them. If they occur, each wave will be less severe than the previous. We also have many more tools to respond that we didn’t have then.

          Uncertainty does not mean the worst will occur or that we are helpless if it does. It’s fine to think about those things in terms of possible planning, but it helps to remain factual in our approach to the immediate problem.

          • Please don’t be patronising Rob, with your “It helps to remain factual”.

            It really doesn’t matter greatly what age group is most at risk. So long as the fatality rate is elevated and/or governments or friends or family or simply concerned fellow citizens seek to reduce travel to reduce the risk to the vulnerable the effect on airlines is all shades of red.

            As for “each wave will be less severe than the previous”, either you are ignoring what happened with Spanish Flu or you know more than the discussions I’ve seen between specialists in this field, where the understanding appears to be it is too early yet to be certain whether there will be multiple waves or the relative seriousness of any such wave(s). The uncertainty remains, the effect on air transport remains chilling.

            “Many more tools to respond”. Which of these tools is an actual effective, adequately available treatment for someone at elevated risk of dying and who becomes infected? I’m sure there is hope that computer based rapid identification of a potentially effective pre-existing drug can identify such a treatment near term but I haven’t seen any report anywhere yet of this stage being reached. Until it is, the fear remains and the effect on air transport remains.

          • Woody, no disagreement on the impact to the aviation industry. But projecting this as being equivalent to Spanish Flu is not justified, not helpful, and unlikely to materialize.

            We know that the severity of any additional waves will decay over time, because that’s how runs of infectious diseases always come to an end. Immunity in the population will become dominant, especially when aided by healthcare measures. It’s just common sense.

            As I mentioned earlier, the vast majority of infections are not serious or life-threatening. Many are not even symptomatic. Recovery rate is very high. It only becomes life-threatening for those whose immune systems cannot fight off the infection. So those are the groups at risk that we need to be protecting.

    • By significantly limiting the transmission of the virus by public health and hygiene measures the virus will tend to evolve into strains that cause less harm but keep their human hosts mobile and working normally. These strains will likely confer immunity against earlier strains.

      • These are current 4 human coronviruses, of about 7 known

        and the current nasty Sars-HCoV-2

        229E and OC43 are mostly responsible for common colds

  15. Cancellation of ALL US -Europe travel was one of two Trump blunders he made reading from the teleprompter

    White House had later to correct , that US citizens and permanent residents werent included in ban as they can come and go as they like , but not surprisingly huge numbers made a dash to the airport in Europe.

    As well Trump said “his ban would apply to “the tremendous amount of trade and cargo” between the U. S. and Europe.”

    This was later ‘corrected’ by the White House as not applicable .
    Gee Trump is live spreading fake news from the Oval Office

    • Trump also said that COVID-19 treatments would not require an insurance copay, but actually it was testing, not treatment. Insurers have agreed to include the same coverage as for other viral infections, and not exclude anyone due to COVID-19.

  16. UNFORTUNATELY, WE MAY NEED A 9/11 TYPE OF REACTION FOR AIR TRAVEL… at the passenger control level again. Ouch.

    We need to manage the public perception…and deal with the real health issue. I am not really sure i want to go through the process below but…the alternative is obliteration of air travel as we know it for a while. And not 1-2 months. That is delusional. See the psychosis in the media.

    We filtered successfully the terrorists out of air travel via a combination of airport controls and government intelligence after 9/11.

    We may need to do the same again, this time around health control. Here is what we need — very very roughly:

    a) Instant tests to detect Chinese flu level of exposure/sickness. And/or instant walk-in scanning. So a new “TSA” like line. And for airport employees. Crews… etc.
    b) Everyone getting on a flight gets tested there in real time.
    c) If you are diagnosed and pushed back, flight cost is reimbursed, so you’ll take the risk and book.
    d) Planes sanitized after x cycles as they do in the US right now every eve. And independent review this is done.
    Add 1-2h to getting on a plane. Sigh.

    Remember how the 9/11 measures felt constraining in the days after? I know, i flew all the time back then domestically/internationally. And i was flagged 75-100% for the first 180 days as my place of birth was the IC.
    This would be the same adjustment: Fatalism 🙂

    Yes, the alternative is a 99+% vaccine. This will take real, real time. And then you have all those idiots not believing in vaccines (take them a bit to sub-saharian Afrika in the forest and let them be for a while).

    But yes very very slippery slope. What’s next? Now, if you look at China that’s what they are doing. Though at the end this can’t be temporary because like the regular flu, the Chinese version will recur in waves.
    Note how the Chinese are doing it with a combination of Orwellian (scary) surveillance at the individual, big data level, to let you through or not as you want to move, policing in different form to visit and control you, etc. Beyond now your ‘social’ score, the Chinese government attributes you a ‘flu’ score on how likely you are to be infected/risk you pose.

    We may just starting to go though that change process, as we did with 9/11.

    • Ivorycoast

      The problem with your a) Instant test; is that at the moment most testing is done using PCR (polymerase chain reaction) in order to determine that the patient has a Coronavirus infection, the patient needs to be shedding virus particles i.e. not just incubating the virus, but infected, and most likely showing signs of the disease already.

      These tests are not instant, some may take hours, so what do you do with a potentially infected passenger for a number of hours, how do you isolate potentially thousands of passengers while they await the results of the test ?

      I have heard there is a UK company working to produce a much quicker test that will detect infection from a breath specimen (potentially more accurate than mouth / nose swab as the sample particles come from deep in the lungs) in much the same way as a breathalyser. Apparently they have now received significant funding from the UK government to aid their development.

      In the future, we may have to trade some of our freedom to do whatever we want in order to survive. The next virus may have a much longer incubation period, and be far more deadly.

      We already see a resurgence of Measles due to personal beliefs that science is wrong, and some arbitrary person on the Internet is right.

      By the way if there is anyone reading this who believes the Earth is flat, I’d love to talk to you, I’d love some factual explanations on how that theory explains the seasons, day, and night, different time in different parts of the world, curvature of the Humber bridge, movement of the stars etc.

      I’m open minded, I believe the Earth is an oblate spheroid. It makes perfect sense scientifically, even to a 6 year old in a darkened room with a Globe, and a torch, but I promise I will listen to your argument, and say nothing.

      • JakDak:

        Unfortunately logic, science and facts are not relevant for people who believe the earth is flat. (or whatever the contention is in that arena of opinion (best I can do as an expression)

        We have had a discussion on MAX stability that people that are experts in the field say it is perfectly stable aircraft and someone with an “opinion” disagrees despite they don’t have the math or calculations to even contend let alone prove it.

        I don’t understand it, but then my bent is to data and facts. I have to accept its there.

        You can put out all the data you want and it does not change the view.

        The guy who killed himself going up in a rocket proves that point.

        He could have bought an airline seat and guaranteed to go much higher, but the only way to prove it was a rocket that if it had not blown up would have been unstable, no reason to believe it would get up to 50 ft let alone 35,000 etc.

        Just the reality of the phenomenon.

        • “”We have had a discussion on MAX stability that people that are experts in the field say it is perfectly stable aircraft and someone with an “opinion” disagrees despite they don’t have the math or calculations to even contend let alone prove it.””

          It’s more about if MCAS is a stall system. Nobody has the data, Boeing is hiding. That’s why EASA will flight testing without MCAS.
          Why hiding if everything follows regulations.
          Boeing is famous for not following regulations, they can’t even install simple wiring.
          The MAX is grounded for one year and there is only a software fix for MCAS which even isn’t a good software fix.
          Are the pax from JT043 still traumatized?

          I miss Philip, he contributed a lot of knowledge to this site.
          It’s always good to have different views until facts are proven.

  17. I’m guessing the virus will be quickly contained in the US with the end of flu season. I’m guessing it hit China at its peak — in November and December. Still, this will be a major economic hit. And I am also guessing that major corporations in trouble will take advantage of the crises in much the same way they have done in the past — and Boeing might be the first with major layoffs and perhaps radical restructuring. Naomi Klein calls this the “Shock Doctrine” ( ). I remember that Douglass laid off more than 10,000 workers in St. Louis under cover of the first Gulf War. So, the economy, I think, has been due for some major corrections anyway, and the virus will be blamed. It’s going to be much rougher economically than health-wise, I am guessing.

    • Guessing is the same as gambling.

      You need data for decisions and a lot of data is missing, not because of anyone not trying to release it at this point, its the time thing again, you need time to do a diagnostic of each victim and enough victims to get a good data set.

      Guessing has us at this point where you can’t test which in turn means you can isolate acualy sick people, so you have to have mass cancellations of every event to try to buy time.

  18. Scott,

    It would be nice for LNA to do an article on the effect of coronavirus on airlines, both ongoing and potential. With travel restrictions everywhere and many airports practically empty, are we potentially seeing a massive problem in airline business, unless governments step in and help? I presume even the best ones like United, Delta, American must be in terrible financial pain. Just a request.

  19. Interesting AA announced they are going to stop operating their 767 s ( that was already in process) and also their 757s (that is new) within a few months.
    They are making lemonade with lemons and using the traffic slowdown to both reduce capacity and improve fuel efficiency.
    Now if they cancel MAX orders (over a year’s delay gives them the legal right to do so AND recover advance payments) and exercise A321 options for deferred deliveries they will end up with the most modern domestic fleet.

    • More if the traffic is not there then park the least efficient birds and make decision going forward as to need and how it fits in.

      There is not a business in this country that has not stopped anything but necessary funding (hopefully not research)

      We had 3 possible trips going this year, two for sure, all have been put on hold.

    • Interesting to me is
      AA is using A321-200 with 102 seats, could be able for 3500nm.
      I wonder how many they have with this configuration.
      They have 219 A321-200.

        • The ceo is by far not as good as the neo. AA already has A321neo in service. If they want range why don’t they use the neo with better range.

          You earn if a plane is filled. If the load factor is low it’s better to use a smaller plane, which AA might try to do with a 102 seats A321-200.

  20. If they could use those to replace 767/757 on the UK / South America?

  21. Hello Scott,

    I’ve a question regarding the conditions of common aircraft purchase contracts:

    Currently many airlines need cash to survive. Can these airlines cancel existing orders of aircraft due to deliver delays (737MAX) and get their deposits immediately back?

    I could imagine, that this could let to many cancelations of Boeing jets, while Airbus orders will be just deferred.

    KR Jörg

    • Imagine every MAX order would be cancelled. Where would Boeing get the cash to pay the deposit back. They already spent everything, took a loan to pay stupid dividents.

      I wonder how much deposit needs to be paid. It seems to be much when Emirates changed from 777X to 787.

  22. Airbus has big problems:
    1 Ongoing cost of shutting down the A380 program.
    2 Bribery Scandal will not only cost 3.6 billion euro is will wrap in scandal and may take down big customers of Airbus such as Tony Fernandez of Air Asia.
    3 The A400M and the parsimoniousness of European government in ordering only about 70 of the type. It’s rather ridiculous for Europeans to complain of US defence spending cross subsidising Boeing when the A400M, which provided the key composites fabrication know how for the A350 is allowed to languish and be a drain on Airbus.
    4 The Impact of US tariffs and WTO settlements.
    5 Ongoing transfer of Airbus know how to China (that will not end well) with A350 manufacture is China.
    6 Accelerating Demographic decline of Europe and demoralisation of its energy.

    • A400 is clearly a debacle, same cost as a C-17 without the C-17 cargo size. Sold on the same basis as the A380, build it and they will come.

      I don’t see A350 ever made in China nor any technology in that area that would allow the Chinese to copy.

      Lets face it, the A320 is a pretty old bird tech wise. The C919 is a lame copy of that and you don’t get into the big time making copies. The Russians at least realized that and the MC21 is more advanced (oddly I can’t find out how much more, just the wing build composites)

      I assume Europe like the US will have immigrants working their way up through the economic strata and available for the jobs.

      I would worry more about European dependence on Russian gas. That was funny as they got flaked off at the US for trying to stop fiance on another gas line down the Baltic.

      Hmmm, we spend how much on NATO just to get the gas cut off? Really?

  23. Don’t worry William, w’ll be alright.
    1) not sure what those ongoing costs are..
    2) not seen any indication
    3) 70, should we order 100 more?
    4) w’ve only seen half the episide, more to come..
    5) not sure A350 is manufactured in China.
    6) but everybody wants to be here, refugees from all over the world. Something must be good..

    • I don’t think ‘too big to fail’ holds true here and the one element of discretionary expenditure for an airline, particularly with declining volumes is new aircraft

  24. 1: impact appears limited
    2: was scoped into the 2019 numbers reported.
    3 .. nn: not any more factual either.

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