Is 737 Problem Trouble For Boeing?

August 29, 2007 by Douglas A. McIntyre

A Boeing 737 burned in Tokyo, probably because a wing part punctured a fuel tank. The US government is asking that all 737s be examined for similar trouble. According to MarketWatch, "there are 783 similar Boeing jets in the United States."

If the problems turns out to be pervasive and costly, the question is likely to come up about what financial role Boeing will play in replacing the parts. Airlines will certainly be hurt if they take a lot of the 737s out of service.

Boeing has been on a run. It has beaten rival Airbus by getting to market quickly with its new Dreamliner. As Airbus has stumbled with its new super-jumbo jet, Boeing has sold its new stretch 747.

Right now, it appears that a maintenance problem may have cause the indident in Japan. If so, Boeing is off the hook. But, it is too early to tell that, which is not good for Boeing’s stock.

Douglas A. McIntyre

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