Thursday 25 April 2019 10:24 am

The worst may still be yet to come for Boeing, after it takes a $1bn revenue hit from 737 Max disasters

Describing Boeing’s past two months as “turbulent” is both a cliche and an understatement.

It's found itself at the centre of not one but two aerospace disasters and its mighty brand now risks becoming synonymous with aviation risk.

This is intensely dangerous territory for the world's largest commercial aircraft manufacturer. Worse still, as Boeing's boss admitted yesterday, it doesn't know when and how one of its flagship models will be deemed fit to fly again.

The picture is so bleak, Boeing yesterday gave up on estimating full year profits for 2019, but admitted a $1bn hit to revenues after it halted production of its 737 Max-8 jet and said it will stop its share buyback plan.

A worldwide regulatory crackdown grounded Boeing's Max model after two of the aircraft tragically crashed within five months of each other, killing 346 people.

It's working on a fix for the software issue that links the crashes, but yesterday said it still can't be certain when and under what conditions regulators will allow the fleet back in the air.

Investors had long been understandably nervous about Boeing's first quarter results, but that didn't make the news they received from the Chicago-based plane maker any easier to swallow.

The lack of (likely negative) forward guidance saved the share price from a sharp decent yesterday, but it will get worse.

A clearer picture won't be known until the second quarter results, as production cuts to the troubled 737 model only began in April.

Compensation claims from affected airlines around the world will drag on and it faces class actions and lawsuits from grieving families and shareholders alleging securities fraud and "putting profit ahead of safety" after more than $30bn was wiped from Boeing's market cap in the weeks since the Ethiopian Airlines crash.

The aerospace company has sped up production of its long-haul 787 Dreamliner, which will keep cash coming in.

However, even this model has sullied Boeing's reputation by association because deterioration of its Rolls-Royce made Trent 1000 engines saw British Airways, Singapore Airlines, Air New Zealand and others ground planes.

Boeing faces battles on another front too, finding itself at the centre of the ongoing trade spat between the US and EU.

Brussels has accused the US of subsidising Boeing to the detriment of Toulouse-based rival Airbus.

A long-awaited WTO ruling on US subsidies and tax exemptions for Boeing confirmed they were illegal and the EU, under scrutiny for its own relationship with Airbus, responded with "countermeasures" worth €12bn.

The aerospace rivals will remain as pawns when new trade talks between the US and EU begin. However damaging and drawn-out the geopolitical tit-for-tat is, Boeing may yet find the reputational consequences of two aviation disasters even harder to overcome.