Business news. For Boeing, the largest aircraft maker in the world, things seem to have gone from bad to worse. It is now pretty clear from the black box that was found, following the crash of Ethiopian Airlines flight ET302 which dropped shortly after taking off, that there appears to have been an issue with software. The aircraft incident sadly killed 149 passengers and eight crew members onboard. The plane was on its way to Nairobi when it went down just six minutes after takeoff. Garuda airlines are the first airline to publicly cancel orders as the US Feds continue to investigate the information that was used by Boeing to certify the 737 Max. Since the latest incident, the stock price of Boeing has tumbled 15%. 

Garuda Cancels Orders

Since the crash of a second aircraft, every country around the globe has grounded the Boeing 737, Max. This week, Garuda Indonesia said it is seeking to cancel an order for 49 Boeing Co. 737 MAX jets, saying passengers have lost confidence in the aircraft. This statement is true. Nobody will fly on the aircraft and it will take intensive investigations and fixes from the FAA to reestablish confidence. The cancelation makes Garuda the first airline to publicly confirm plans to cancel a 737 MAX order. Garuda CEO I Gusti Ngurah Askhara Danadiputra said in several interviews that the airline sent a letter to Kevin McAllister, head of Boeing’s commercial plane division, “to say that we want to cancel.”

Lack of Safety Features are Costly

It appears that both the Indonesian and Etheopian aircrafts did not have a specific safety feature that would have saved lives. According to reports, an angle of attack indicator, which tell pilots the angle of their plane, was one of the two safety features that came at an additional cost to airlines. The other, a disagreement alert, would then warn those in the cockpit whether the sensors were providing conflicting information. Since both planes did not come with these indicators, the pilots did not know there were issues. The standard-issue Boeing 737 Max jet featured only one sensor. According to Boeing these safety features will become standard on the planes and included in a software update that is expected to correct issues with the 737 Max jets.

The Feds are Involved

US Justice Department prosecutors and in the process of conducting criminal investigations into both Boeing aircrafts. The Fed has issued multiple subpoenas as part of an investigation into Boeing’s Federal Aviation Administration certification of 737 Max planes. The investigation initially began in October when the Lion Air in Indonesia crashed. The Justice Department is evaluating whether Boeing itself had issues when it certified the plane as safe and what data it presented to the FAA.

Boeing Stock Prices

Boeing stock price has weighed on the Dow Industrials. The price of the stock tumbled 15% since the Etheopian crash occurred. An investigation into the companies actions from top to bottom will take place, but many feel that Boeing is a safety first company. Economists are also looking into whether the decline in the value of Boeing and the cancelation of aircrafts will have a negative effect on US economic growth.