Boeing puts a price tag on the MAX disaster as it suffers loss

Boeing lost US$636 million last year. It’s first and biggest loss for almost thirty years.

Having scrambled to raise $12 billion to maintain its cash flow over the next few months, the manufacturer announced that it was expecting the total bill for the 737MAX to be $19 billion.

It seems like a massive sum of money but it needs to be put in context. It’s the cost of roughly 200 737MAX at delivery prices. When you have a backlog of 4,500 it starts to make the total look rather minimal. In Boeing’s terms it’s just a couple of drops in the ocean.

What has happened and is more serious, is the knock-on effect for the suppliers and component manufacturers who just don’t have the margins and the financial leeway to manage a loss in income.

The real price is Boeing’s global reputation. Never before has there been a globally viewed and openly reported series of events in aviation like this. The publicity and public awareness is utterly unprecedented and few people don’t know what the MAX is, and even more understand what happened.