Boeing Stock Plunges as December Deliveries Disappoint

Boeing's stock took a nosedive in December 2024, as the company's delivery figures for the month fell significantly short of expectations. This crucial metric, which is a key indicator of Boeing's financial health and operational efficiency, has raised concerns among investors and industry experts alike. Let's delve into the factors that contributed to Boeing's disappointing December deliveries and explore the implications for the company's stock.



Boeing's delivery performance in December 2024 was marred by two major factors: a labor strike and quality control issues. A protracted dispute over a new labor contract led to strikes and the shutdown of production lines in the autumn, notably on the 737 MAX. This labor action significantly impacted Boeing's ability to deliver aircraft, as production lines were idle for an extended period. The strike ended in mid-December, but the disruption caused by the walkout likely contributed to the lower delivery numbers in December.

Additionally, a high-profile door plug blowout on a Boeing 737 MAX on an Alaska Airlines flight in January 2024 raised renewed safety and quality concerns at Boeing. Then-CEO Dave Calhoun deliberately slowed deliveries while the company worked on improving quality control in the spring. Slowing 737 MAX deliveries is one of the last things Boeing wants to do and the last thing airlines wish to see, but everybody wants to see Boeing ensure the quality of their airplanes.

Boeing's delivery performance in 2024 was significantly lower than that of its European rival, Airbus. According to the data released on Tuesday, Boeing delivered 348 jetliners during the year, which was more than a third fewer than the 528 the company finished for airlines and leasing outfits in 2023. This figure was also less than half the number of jetliners that Airbus delivered last year. Airbus handed over 766 jets in 2024, just shy of its 770 target, compared to Boeing's 348 deliveries. This marked the largest gap between the two companies' commercial jet deliveries since 2020.

The Alaska Airlines incident and the machinists' strike significantly impacted Boeing's production and delivery capabilities in 2024. The Alaska Airlines incident in January 2024 led to an emergency landing after a door plug blew off a 737 Max, prompting heavy scrutiny from Capitol Hill and the Federal Aviation Administration (FAA). This incident led Boeing to cut output on the MAX while it intensified quality control efforts. The machinists' strike in the fall of 2024 further hampered Boeing's delivery capability, as production did not resume at the plants until mid-December.

Boeing's stock price has been volatile in recent years, and the company's disappointing delivery figures in December 2024 have raised concerns among investors. However, it is essential to remember that Boeing still has a multiyear backlog of orders for the 737 MAX, and there is no shortage of demand for widebodies like the 777X. If Boeing can successfully address the quality control issues and restore its operational efficiency, the company could have a great 2025 as it works toward developing a new plane by 2035.

In conclusion, Boeing's stock took a hit in December 2024 due to disappointing delivery figures, which were primarily attributed to a labor strike and quality control issues. While these challenges have raised concerns among investors, Boeing still has a strong backlog of orders and a promising future if it can successfully address its operational challenges. As an investor, it is crucial to stay informed about the company's progress and make decisions based on a thorough understanding of the underlying factors driving Boeing's stock price.