An Ethiopian Airlines flight crashed just after takeoff, killing all 157 thought to be on board
Boeing shares fell sharply Monday, a day after Ethiopian Airlines Flight 302 crashed shortly after take off, killing all 157 passengers and crew on board.
The Boeing 737 MAX 8 plane that nosedived into the ground outside the Ethiopian capital of Addis Ababa is the same model from a similar crash less than six months ago. On Oct. 29, an Indonesian Lion Air flight plummeted into the Java Sea, killing all 189 passengers and crew members.
Investigators will likely look into similarities between Sunday’s crash and the October incident. In both cases, the pilots attempted to return to the airport a few minutes after takeoff and both flights experienced drastic speed fluctuations during ascent.
Boeing (BA) shares were down more than 7 percent midday Monday to $392.21, an uptick after dipping 11 percent in early trading. The stock had risen 28 percent over the past 12 months.
U.S. airlines’ defense of the 737 MAX 8 and investors seeing a chance to snatch up Boeing stock at a discount could be helping the stock bounce back, says Jim Corridore, director of industrials equity research at CFRA Research.
Boeing has delivered 350 737 MAX 8 planes – and it has orders for more than 4,600 more – and the aircraft has had “tens of thousands of flight hours,” Corridore said, “enough to feel the plane is safe.”
Several countries grounded Boeing 737 MAX 8 planes after Sunday’s crash over safety precautions. China and Indonesia grounded their jets, and Ethiopian Airlines grounded its remaining four Boeing 737 MAX 8 planes until further notice as an “extra safety precaution,” the operator said.
In a note to investors Monday, Corridore said he expected most 737 MAX planes to resume flying “over the next day or two.”
“We think the issue could be related to the plane’s software, which causes it to dive when it thinks the plane might stall,” said Corridore, who maintained a “Strong Buy” on Boeing shares. “This seems to be what happened in the Lion Air crash. However, the system is easy to override and pilots should know how to do it.”
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Boeing said a technical team was headed to the crash site to investigate, along with the Ethiopia Accident Investigation Bureau and U.S. National Transportation Safety Board.
The aircraft maker’s MAX 8 plane is a newer, more fuel-efficient model within its popular 737 line.
Contributing: The Associated Press
Follow USA TODAY reporter Mike Snider on Twitter: @MikeSnider.
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