08:17 GMT +319 October 2019
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    A worker walks next to a Boeing 737 MAX 8 airplane parked at Boeing Field, Thursday, March 14, 2019, in Seattle

    Boeing Hit With $5.6Bln Second Quarter Loss Over 737 Max Groundings - Statement

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    WASHINGTON (Sputnik) - Boeing announced that it expects to report a pre-tax loss of $5.6 billion in the second quarter due to the grounding of 737 Max jets and rising expenses related to the crash-prone jet.

    "Boeing will record an after-tax charge of $4.9 billion ($8.74 per share) in connection with an estimate of potential concessions and other considerations to customers for disruptions related to the 737 MAX grounding and associated delivery delays", Boeing said in a Thursday news release. "This charge will result in a $5.6 billion reduction of revenue and pre-tax earnings in the quarter".

    In addition, Boeing said it faces an unplanned increase in second-quarter expenses of $1.7 billion, primarily due to a slowdown in manufacturing additional 737 Max jets; expenses that will reduce profit margins in future quarters.

    Global aviation authorities grounded the 737 Max following two crashes - in Indonesia and Ethiopia - that killed a total of 346 passengers and crew because of a software glitch that prevented pilots from turning off a defective autopilot system.

    Boeing's attempts to repair the defects are taking longer than expected, and the company does not expect the planes to be declared safe to fly by US and other regulators until November at the earliest.

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    Tags:
    losses, grounding, 737 Max, Boeing
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