Chicago-based aircraft manufacturer Boeing’s board of directors met yesterday and approved a $2.055 per share dividend for the third quarter. This latest dividend will be payable to shareholders on December 6th , 2019.
While news of the dividend will please owners of Boeing stock, the board still faced the grim reality of knowing that Boeing was caught up in the biggest crisis of its 103-year history.
Boeing is still trying to manage the fallout from the 737 MAX crashes
While meeting at the San Antonio facilities where Boeing manufactures Air Force One, directors gathered to discuss how to manage the fallout from the on-going 737 MAX crisis.
Just last week, news broke that before the 737 MAX was certified to fly a pilot who played a key role in the development of the plane had voiced his concerns over the MCAS system deemed responsible for two fatal crashes.
This latest revelation has not only undermined the company’s defense but has now opened up the prospects of further legal action sending the airlines stock lower.
Airlines still don’t know when the MAX will fly again
As for the 737 MAX it still remains grounded awaiting recertification from the FAA and is forcing Airlines to keep on guessing as to its return into service. And it is not just the airlines who are having to find alternatives. Boeing has said it may have to halt the aircraft’s production for a while.
If this were to happen, it would have enormous financial consequences not only for Boeing but its employees as well. This coming Wednesday, Boeing will release its earnings for the latest quarter with analysts predicting that the MAX crisis will continue to weigh heavily on the company’s profits.
All this is taking place while Boeing CEO Dennis A. Muilenburg prepares to testify before Congress next week.
It would appear as if the Boeing board may be preparing Muilenburg as a scapegoat for the MAX crisis after recently stripping him of his chairman title. This followed a scathing report criticizing Boeing and the FAA.
“While we have not been able to speak to Mr. Forkner directly about his understanding of the document, he has stated through his attorney that his comments reflected a reaction to a simulator program that was not functioning properly, and that was still undergoing testing.
“We are continuing to investigate the circumstances of this exchange, and are committed to identifying all the available facts relating to it, and to sharing those facts with the appropriate investigating and regulatory authorities.”
So far Boeing estimates that the 737 MAX crisis has cost the company in excess of $8 billion. This is a figure that is set to rise should the beleaguered jet not receive an airworthiness certificate by the end of the year.
Muilenburg has been preparing ahead of an expected grilling by Congress
The weeks ahead and Muilenburg’s testimony before Congress should prove interesting. While Muilenburg has been practicing with lawyers prior to facing Congress, the man has not come off as being very compassionate towards the families of the crash victims.
Somehow following this latest news from Mr. Forkner I can’t help but wonder what else Boeing new about the MCAS system and kept quiet about it.
What do you think? Please let us know in the comments.