Boeing Company shares dropped badly on Monday, the worst in three years, after China, Indonesia and Ethiopia decided to ground their seven three seven MAX eight planes following the second deadly crash of one of the plane in just five months.
Ethiopian Airlines B737 Max 8 bound for Nairobi crashed minutes after take-off, killing all 157 people on board.
It was the second crash of the B737 MAX, the latest version of Boeing’s workhorse narrowbody jet that first entered service in 2017.
In October, a 737 MAX flown by Indonesian budget carrier Lion Air flying from Jakarta on a domestic flight crashed 13 minutes after take-off, killing all 189 passengers and crew on board.
A source from Reuters said it was too early to say whether the accidents are related but added it would be a “very big issue for Boeing” if they are.
The drop – around 7 percent in late morning trade – wiped nearly $16 billion off Boeing’s market value, marking an abrupt reversal for a stock that had been the runaway top performer this year in the Dow Jones Industrial Average.
With a stock price near $400 a share, it was by far the largest drag on the price-weighted blue chip index on Monday.
Boeing said on Monday the investigation into the Ethiopian Airlines crash is in its early stages and there was no need to issue new guidance to operators of its 737 MAX 8 aircraft based on the information it has so far.
China has taken the unusual step today of telling its airlines to stop flying the 737 Max. But some have critisized that move because it’s not the lead regulator for the 737 which is built in the U.S. asking them to wait for the country where the aircraft is certified to take the lead.