China’s aviation regulator met with Boeing executives last week to discuss the potential return of the grounded 737 MAX.
Boeing Co. (BA) – Get The Boeing Company Report shares moved higher Tuesday after aviation regulators in China confirmed a meeting with company executives aimed at bringing the troubled 737 MAX back into service in the world’s biggest airplane market.
China’s Civil Aviation Authority (CAAC) said Tuesday that it met with Boeing executives in last week in Beijing as part of an ongoing effort to allow the 737 MAX, which has been grounded since 2019, to return to service in Chinese airspace.
Boeing CEO Dave Calhoun said last week, just after the CAAC meeting, that he felt there was “a chance” that regulators would clear the 737 MAX 10 before the end of the year, but CFO Brian West also indicated the company could ‘remarket’, or sell some of the 140 planes destined for China to other customers around the world, if regulators continue to delay its approval.
The CAAC issued an “airworthiness directive” on December 2 of last year that provided instructions to airline operators as to what changes are required from the 737 MAX before the planes can be included in fleet operations, but has yet to issue final approval after months of negotiations.
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“We have deferred decisions on those planes for a long time,” West told an industry conference in Washington. “We can’t defer that decision forever. So we will begin to remarket some of those airplanes.”
Boeing shares were marked 1.7% higher in pre-market trading to indicate an opening bell price of $147.35 each.
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Boeing posted a wider-than-expected second quarter loss of 37 cents per share in late July, on revenues of $16.7 billion. Operating cash flow, however, turned positive at around $100 million for the quarter, and the group said it would be cash flow positive in 2022.
Boeing’s order backlog now totals around 4,200 commercial aircraft, the company said, with a list value of around $372 billion.