Boeing slumped to its biggest ever quarterly loss as the prolonged grounding of its bestselling 737 Max jet took its toll on the US aircraft maker.
The aerospace manufacturer also warned that it might have to halt production if it has to revise its expected return to service later this year.
Boeing said it expected the Max to start returning to the skies “early in the fourth quarter” but cautioned that it might have to further reduce or temporarily shut down production if the timing slipped significantly.
Boeing cut production of the 737 Max from 52 to 42 a month in April after its worldwide grounding in March following two fatal crashes that killed 346 people.
Dennis Muilenburg, Boeing chief executive, said on Wednesday that while the company planned to boost its production rate gradually to 57 a month next year, any slippage could derail those plans.
“Should our estimate of the anticipated return to service change, we might need to consider possible further rate reductions or other options including a temporary shutdown of the Max production,” Mr Muilenburg said.
He said the company continued to work on software changes and expected to submit its “final certification package” to the Federal Aviation Administration, the US aviation safety regulator, “somewhere in the September timeframe”.
His comments came as Boeing reported a net loss of $2.94bn for the second quarter after announcing last week that it would book an after-tax charge of $4.9bn in the period to compensate airlines that have been affected by the grounding of the 737 Max. The net loss compares with a profit of $2.2bn in the same period last year.
Revenues in the second quarter were also down to $15.7bn, from $24.5bn the year before, reflecting the impact of the Max crisis but buoyed by higher volumes in its defence and services businesses.
It recorded an earnings per share loss of $5.21, compared with $3.73 in the same second quarter last year. The company also saw free cash outflow of just over $1bn in the period.
Boeing shares fell just over 2 per cent to $363 per share in midday trading in New York.
“It could have been worse,” said Robert Stallard, an analyst with Vertical Research Partners, in a note to clients. “Although the headline numbers for [the second quarter] look pretty grim, they are not as bad as we had been forecasting.”
The hit to Boeing’s earnings underline the magnitude of the crisis for the company. The likely cost estimates also do not include any potential order cancellations or compensation payments to victims from both crashes.
Away from the Max situation, Boeing also said that the first flight of its new 777X wide-body jet was delayed from late 2019 until early 2020 because of problems with the engine provided by General Electric.
Boeing is still targeting first delivery of the 777X in late 2020 but Mr Muilenburg warned that the engine issue had added “significant risk” to this schedule.
