Boeing (BA, $364.32) loses $6 billion order
The Boeing 737 trouble doesn’t seem to be ending, as Indonesia’s national airline handed Boeing its first official order cancelation following two deadly crashes in recent months.
Indonesian airline, Garuda, on Friday publicly announced it has told Boeing that it wishes to cancel its multibillion-dollar order for Boeing's 737 Max 8 passenger jet, citing that its passengers had lost confidence in the model after two deadly crashes in five months.
According to Garuda, it already sent a letter to Boeing on March 14, seeking to cancel the pending delivery of its 2014 order of 50 planes, of which just one had been delivered so far.
Estimated to be worth $4.9 billion, the cancelled order is the latest blow to Boeing over the 737 Max - its bestselling passenger jet.
The plane has been grounded by many authorities across different countries like U.S., Europe, China and Indonesia, but it's the first airline to say it's canceling a 737 Max 8 order.
Garuda spokesperson Ikhsan Rosan told news agencies that it is difficult to cancel such agreements once they have been signed, but with passengers losing confidence to fly with the Max 8, there wasn’t much of an option.
Overall, more than 4,000 737 Max planes are on order by airlines around the world. Boeing’s stock dropped about 12% since the Ethiopian Airlines crash, and was down more than 2% in Friday trading.
