Why Boeing Stock Popped Today
Shares of aerospace giant Boeing (NYSE: BA) soared 4.7% through 10:45 a.m. ET Tuesday after the Puget Sound Business Journal reported that the company is pushing the Federal Aviation Administration (FAA) to hurry up and complete certification of the company's 737 MAX 10 airliner for service.
The MAX 10, which is similar to but bigger than the company's better-known 737 MAX 8 and MAX 9 airliners, must be certified by the end of this year if Boeing is to keep building the plane thereafter under an exemption provided in a Congressional 2020 aviation bill, reports the Business Journal.
Certification of the plane under this exemption would give Boeing a boost in using the plane to compete with Airbus' (OTC: EADSY) popular A321neo line of planes. However, there's a downside to this story: If the FAA does not certify the 737 MAX 10 for flight by the end of this year, Boeing will have to spend as much as $10 billion redesigning the plane to include a new crew alert system. (A crew alert system sounds alarms, flashes lights, and vibrates controls to alert the pilot when something has gone wrong, and the system currently installed in the MAX 10, while upgraded from past versions, doesn't fully comply with current safety regulations -- hence the exemption.)
Source Fool.com
