Boeing (BA) stock slipped after the FAA backed a company timeline for the troubled 737 Max aircraft to be back in the air by December.
Ali Bahrami, the Federal Aviation Administration's associate administrator for aviation, shed further light on when the Boeing 737 Max will once again be operational at a safety conference in Europe.
He said that while the FAA is "under a lot of pressure," the grounded narrow-body jet will only return to service "when we believe it will be safe," according to Bloomberg.
When asked if the plane would resume service this year or next, he told Bloomberg that Boeing CEO Dennis Muilenburg's timeline by the end of 2019 sounded right.
But Bahrami added it is not possible to give an exact date while work continues on safety fixes.
The Boeing 737 Max has been grounded globally since March. It came after the deadly Ethiopian Airlines crash on March 10, which followed a similar 737 Max crash by Indonesia-based Lion Air on Oct. 29. The two crashes killed a total of 346 people.
Knowing when the 737 Max may return to service will help airlines contend with disruption caused by its grounding of Boeing's most popular model. The FAA has said that there's no time frame to sign off on Boeing's proposed software fix for the jet.
Boeing Stock Stumbles
Boeing stock closed down 0.7% at 347.03 on the stock market today. It has a Composite Rating of 72, with the ongoing 737 Max crisis hitting its recent performance. Boeing stock was trading below its 50-day and 200-day moving averages.
General Electric (GE), whose CFM International joint venture with Safram supplies the 737 Max engine, rose 1.6%. Boeing's European rival Airbus (EADSY) sold off 1.1%.
The iShares U.S. Aerospace & Defense ETF (ITA) and the SPDR S&P Aerospace & Defense ETF (XAR) both rose 0.3%.
737 Max Woes Hit Passengers
Earlier this week, American Airlines (AAL) canceled around 115 daily flights of the 737 Max through Sept. 3, three weeks later than previously announced. The firm also said it will need around 45 days for training when Boeing rolls out its expected software updates.
On Monday it emerged that Boeing's biggest shareholder Vanguard had said in a letter to the aerospace giant that its fund managers have become "very concerned" by reports of oversight failures, according to the Financial Times.
Vanguard, which holds a 7% stake in Boeing, said it will continue to engage with the company's executives and directors about its concerns.
The Boeing 737 Max MCAS system, which is supposed to prevent stalling, appears to have been involved in the Ethiopian Airlines and Lion Air crashes.
Last week, Boeing's Muilenburg took a bullish stance, saying the company is performing 737 Max simulated flights with the FAA and predicted the grounded planes will be flying again by the end of the year.
However, only a few weeks ago there were hopes that the FAA would approve the Boeing 737 Max for U.S. flights in July.
Airlines have urged the FAA and aviation regulators in Europe, China and elsewhere to clear the 737 Max at the same time to avoid disruption.
Boeing 737 Max orders and deliveries have ground to a halt for the past several months.
An IBD/TIPP poll has found more Americans are willing to travel on the 737 Max, but also view Boeing more negatively, amid an ongoing investigation and continued flight cancellations through the busy summer season.
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