Boeing Stock Surges as FAA Prepares to Ease Safety Restrictions
Regulators signal growing confidence, set to restore Boeing's authority to self-certify 737 MAX and 787 aircraft after years of heightened oversight.
Boeing shares jumped more than 4% on Friday following news that federal regulators are preparing to ease restrictions on the planemaker, restoring its authority to perform final safety checks on its 737 MAX and 787 aircraft. The move signals a significant vote of confidence from the Federal Aviation Administration (FAA) after years of intense scrutiny over the company's production quality.
The decision marks a pivotal step in Boeing's recovery, allowing it to move away from direct FAA sign-offs for each new plane, a restriction that has contributed to production delays and delivery bottlenecks. , with the stock price reflecting optimism that the aerospace giant can now more efficiently manage its substantial order backlog.
This enhanced oversight was implemented following two fatal 737 MAX crashes in 2018 and 2019 and was intensified after a door plug blowout on an Alaska Airlines flight in January 2024. The FAA's shift suggests that regulators now believe Boeing has made sufficient progress in addressing its quality control and safety management systems.
According to reports, the , a crucial return to standard industry practice. While this will help streamline the delivery process, analysts expect the agency to maintain a rigorous, albeit less direct, level of supervision over the company's operations.
For Boeing, the restored authority is critical for stabilizing its production lines and meeting delivery targets for its most popular aircraft. The development is seen by Wall Street as a key catalyst, potentially paving the way for regulators to approve production rate increases for the 737 MAX, which are essential for the company's financial recovery. The for several years, a measure that is now being reversed as the company demonstrates improved safety protocols.