What’s “up”?
Delta Air Lines has made a new plane order worth upwards of $13 Billion. As a result, Boeing’s stock is up as much as 5% this Monday morning.
The Boeing company has been experiencing turbulence for the past three years. Engineering problems and the pandemic’s impact on airlines have caused the aerospace giant’s shares to lose more than half their value since 2020. New airplanes weren’t in high demand for much of 2020 because fewer people flew.
Boeing secured a major customer on Monday. Boeing’s archrival Airbus has been Delta’s business partner for the past few years, but the airline has ordered 100 of the Boeing 737 MAX jets. The option to purchase another 30 jets is available. The deal is worth more than $13 billion to Boeing at the list price, but Delta will probably pay well below the list price for an order this size.
Boeing is also given a potential ally as it seeks regulatory approval for the jet. Regulators have not yet approved the 737 MAX version that Delta hopes to purchase, and if Boeing cannot get that approval before the end of the year, it may have to upgrade its cockpit.
Preparing for landing
This announcement marks the beginning of what should be a hectic week for Boeing. One of the world’s largest airshows is taking place in Farnborough, England, a time to sign and announce deals between airlines and aerospace companies.
While Delta’s win is not surprising, it is still a significant milestone in Boeing’s debt-reduction and pandemic recovery efforts.