A Boeing 787-8 Dreamliner operated by Air India crashed in Ahmedabad on Thursday, resulting in the loss of 241 lives.
New Delhi: A devastating plane crash in Ahmedabad, India, has sent shockwaves not only across the nation but also through the global aviation and investment sectors. The Air India aircraft involved in Thursday's tragedy was a Boeing 787-8 Dreamliner, manufactured by the American aerospace giant. This accident has not only plunged hundreds of families into grief but also caused significant turmoil in international stock markets.
News of the crash triggered an immediate plunge in Boeing's stock price on the US stock market. Investor anxiety and concerns about the aircraft's technological reliability significantly impacted the company's market valuation.
Sharp Decline in Boeing's Stock Price: Investor Concerns
On Thursday, Boeing's stock closed down 5% at $203.60 on the US stock market. Earlier in the day, during pre-market trading (Indian time), Boeing's shares had fallen as much as 6.42%, reaching $196.51.
This decline wasn't merely an emotional response; it reflected the global investors' fear stemming from past controversies and accidents associated with Boeing. Previous incidents involving the Boeing 737 MAX model had severely damaged the company's image and financial stability.
Background of the Air India Accident
On Thursday, Air India flight 171, en route from Ahmedabad to London, crashed near Meghani Nagar just minutes after takeoff. The aircraft carried 242 people, including 10 crew members and 3 infants. The death toll has been confirmed at 241. This is considered one of the most devastating air crashes in India's recent history.
DGCA and Other Agencies Launch Investigation
India's Directorate General of Civil Aviation (DGCA) immediately ordered a high-level investigation. Officials stated that the black boxes have been recovered, and the Flight Data Recorder (FDR) and Cockpit Voice Recorder (CVR) are being analyzed.
A DGCA spokesperson stated: "At this time, it would be premature to comment on the causes of the accident. A technical investigation has commenced, involving Boeing representatives, Air India technical experts, and independent aviation safety specialists."
Boeing's Response: Pledge of Full Cooperation
Boeing issued an official statement saying: "We are deeply saddened by the accident involving Air India flight 171. Our hearts go out to the families of the victims and the injured. We will provide every possible technical assistance to the investigating agencies. Our teams are coordinating with local authorities and Air India in India."
Impact on the Indian Aviation Sector
Questions about Boeing's technological reliability have also caused ripples in the Indian aviation market. At the close of trading on Thursday, InterGlobe Aviation (Indigo) shares fell 3.31% to ₹5446.35. SpiceJet shares dropped 2.40% to ₹44.40.
Experts believe this decline is not purely psychological; investors fear that potential safety checks and restrictions on Boeing-manufactured aircraft in the near future could impact operating costs and the image of these companies.
Will the 737 MAX Scenario Repeat?
Boeing has already faced criticism over the 737 MAX accidents. Following two major accidents in 2018 and 2019, the model was grounded globally for about two years. At that time, the company experienced a significant stock price drop, resulting in billions of dollars in losses.
Aviation analysts suggest that if the Ahmedabad accident is proven to be due to a Boeing technical flaw, the company could face similar global restrictions and lawsuits.
Market Analysts' Opinions
Investment advisor Mark Aldrich states,
Boeing's decline isn't solely based on the news of the accident. It also reflects memories of past incidents and questions surrounding the company's engineering processes. If upcoming investigations reveal a technical fault as the cause, it could cause long-term damage to the company's reputation.
According to Indian analyst Anurag Mehta,
The current decline is an emotional reaction. The long-term picture will depend on the investigation report. If Boeing is found faultless, recovery could be swift. However, if a flaw is proven, it could also affect the company's future delivery schedules.
Could Boeing's Stock Fall Further?
Prediction is difficult, but given the market sentiment, experts believe the next few days will be crucial for Boeing. If the investigation report raises questions about Boeing's role, the stock could fall further. Conversely, if the cause is determined to be external or operational, investor confidence may return.
