Boeing stock eased Monday after Alaska Airlines reported its grounded Boeing 737 Max 9 jets were resuming air service. Elsewhere, United Airlines could reportedly ditch Boeing for rival Airbus, just ahead of the Dow Jones aircraft maker's Q4 results early Wednesday.
Alaska Airlines announced last week it is nearly finished with inspections for its Boeing 737 Max 9 fleet. The airline began returning the aircraft to service on Friday, with a flight from Seattle to San Diego, the Associated Press reported. The Federal Aviation Administration on Wednesday approved the inspection and maintenance process for the Boeing planes. Alaska Airlines technicians began their inspections that night and completed assessments on its first group of 737-9 Max aircraft early Friday.
The company expects to complete all 737 Max inspections by the end of the month. It plans to increase oversight of Boeing 737 Max 9 production going forward, Alaska Airlines announced in its Q4 report.
However, the FAA capped production expansion of new Boeing 737 Max aircraft. It is launching an investigation into the Dow Jones giant's manufacturing process to ensure quality control, the regulator announced Wednesday. The increased oversight will include a larger floor presence at Boeing facilities. The FAA will also assess potential safety-focused reforms around Boeing's control and delegation processes.
United Flirts With Airbus
Elsewhere, United Airlines approached Airbus about buying more A321neo jets as an alternative to delayed Boeing 737 Max 10 aircraft, Reuters reported, citing a person familiar with discussions. United CEO Scott Kirby visited Toulouse, France, home of Airbus, seeking a potential deal after the Alaska Airlines 737 Max 9 midair emergency on Jan. 5, the industry source said.
The airline has reportedly been in talks about possible alternatives to its Max 10 order. The companies have not yet reached an agreement. United has not canceled any of the 277 Max 10 jets in its order, but has removed them from its internal plans, CEO Kirby said last week.
"Boeing is not going to be able to meet their contractual deliveries on at least many of those airplanes," Kirby said during the company's earnings call. In a separate interview with CNBC last Tuesday, Kirby said, "I think the Max 9 grounding is probably the straw that broke the camel's back for us. We're going to a least build a plan that doesn't have the Max 10 in it."
United's fleet includes 79 737 Max 9 aircraft, which it was required to ground for inspections.
The trade-off for A321neo jets will likely soothe a deadlock between United and Airbus over a separate order for A350 aircraft, Reuters reported citing the industry source.
Boeing Earnings
Meanwhile, Boeing reports Q4 results early Wednesday. FactSet expects the Dow Jones behemoth to report a loss of 78 cents per share, narrowing from the loss of $1.75 per share last year. Analysts forecast slower revenue growth for a fourth consecutive quarter, rising 6% to $21.18 billion.
Airline Stock Action
BA stock ticked down a fraction Monday after climbing less than 1% premarket. Boeing surged 1.8% Friday as Alaska Airlines resumed its 737 Max 9 flights.
United shares faded 1% during Monday trade while ALK stock rose 1.3%.
Airbus trades in American Depository Receipts (ADRs) under the ticker EADSY. Shares were little-changed Monday. EADSY stock is extended above a buy point for a double-bottom base following a November breakout.
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