- Some 41% of Americans say Boeing’s737 Max plane will need to safely return to service for six months before they will consider flying on the plane.
- The aircraft remains grounded worldwide following two crashes that killed hundreds of people.
- In the months since the latest crash, reports have surfaced that Boeing did not tell pilots, engineers, and safety regulators of changes to the plane and its functionality.
- Wall Street remains overwhelmingly positive on Boeing’s prospects.
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Most people don’t check the type of plane they will be boarding when booking flights.
“UBS Evidence Lab surveyed 1,000+ individuals in the US to obtain a benchmark for how the public is thinking about the 737 MAX following the pair of accidents in the last 9 months,” the bank’s aerospace analysts, led by Myles Walton, said in a note to clients Tuesday.
“With the plane now nearly 3mo grounded and still spurring front page news stories, it is still front and center for the public and remains an obvious overhang on shares. So perhaps unsurprisingly, about 70% of the US flying public have some hesitation on booking a flight today on the plane.”
The team’s data show that 41% of Americans would only choose to fly on the 737 Max after six months of safe operation. About 11% said they would change their minds after four to six months, 10% said one to three months are enough, and 8% said they will never fly on the plane.
There’s still no fix in sight for the 300+ grounded planes, most of which are piling up at Boeing’s Everett, Washington, airfield and other storage lots. And while the planemaker’s market value has declined by $US50 billion, or about 22%, from recent highs amid its regulatory kerfuffle, UBS and the rest of Wall Street remains overwhelmingly positive about the company’s future.
“The procurement outlook of an airline purchasing aircraft is 5-10+ years,” UBS said, reiterating its buy rating and $US500 price target for the stock. “This long range view is far different from the narrow window of the general flying public, so given the fade expected in the 737MAX stigma among consumers; we don’t anticipate significant share erosion. We continue to expect an end of July ungrounding with a certification of the new software a few weeks prior.
“Getting the FAA final certification flight will be a key technical and regulatory relief to watch in the near-term,” UBS added.
Elsewhere on the Street, 18 analysts polled by Bloomberg recommend clients buy Boeing, while 10 say hold and only two rate the stock as a sell. Their average price target is $US420, about 22% higher than Tuesday’s prices.
More Boeing news:
- Boeing left engineers, pilots, and regulators in the dark about a late-stage overhaul to 737 Max software responsible for two fatal crashes, says report
- Boeing reportedly told one of its key buyers that the grounded 737 Max will be back in the air by July
- ‘We are sorry’: Boeing CEO personally apologizes to victims of 737 Max crashes but says he will ‘continue to lead the company’
- Regulators can’t decide how much training pilots need to fly the Boeing 737 Max, and it could result in even longer delays to the aircraft’s return
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