NZ Herald
  • Home
  • Latest news
  • Herald NOW
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Herald NOW
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Politics
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Herald NOW
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / Business

Grounding of Max fleet could cost Boeing $10 billion

By Lauren McMah
news.com.au·
14 Mar, 2019 03:50 AM5 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

Earlier: It may be weeks or months until we know why Ethiopian Airlines Flight 302 crashed minutes after takeoff Sunday, killing all 157 passengers and crew on board - if the cause of the crash is determined at all.

Flights are cancelled, airlines are in a logistics nightmare and passengers are wondering how high airfares may now spike as Boeing announced it would ground its worldwide fleet of MAX 8 jets.

The planes started to be wheeled out of service at airports around the United States within hours of the Federal Aviation Administration issuing an emergency order to ground 737 MAX 8 and MAX 9 aircraft until further notice, in light of Sunday's deadly Ethiopian Airlines crash.

The last MAX 8 aircraft in US skies was believed to be Southwest flight WN2569 from Oakland to Newark airport, which reached its destination about 10am Sydney time.

After resisting a decision for days, Boeing has now confirmed it would ground all 371 of its MAX aircraft worldwide "out of an abundance of caution and in order to reassure the flying public of the aircraft's safety".

The decision may cost the US jet-maker up to US$7 billion ($10.2b), according to analysts.

Advertisement
Advertise with NZME.
Advertisement
Advertise with NZME.

Civil aviation authorities, including in Australia, had already banned the aircraft from their own airspace as investigators worked to determine the cause of Sunday's crash that killed 157 people.

Black box recorders from the crashed plane are on their way to Paris to be analysed.

In the US, airlines have been frantically working to re-accommodate customers booked onto flights serviced by MAX aircraft.

Advertisement
Advertise with NZME.

Southwest Airlines, Boeing's biggest customer for the MAX, has had to ground 34 of the planes, which serviced about 150 flights every day. Its passengers are being offered flexible policies to re-book travel.

Southwest flight 2569 prepares for landing at Newark airport. Photo / Supplied
Southwest flight 2569 prepares for landing at Newark airport. Photo / Supplied

American Airlines has put its 24 MAX planes out of action, while United Airlines said about 40 daily flights would be affected.

The three airlines said they remained confident in the safety of the MAX but would comply with the FAA's order.

Former FAA official Stephen Lloyd said while airlines had some reserve aircraft, it was not enough to make up for the dozens of planes now out of service.

Discover more

Airlines

Boeing's stock tumbles as more Max 8 planes are grounded

11 Mar 06:30 PM
Airlines

Grounded: NZ bans Boeing 737 Max planes after Ethiopia crash

12 Mar 11:03 PM
Airlines

Airline lets attendants avoid 737 Max flights

12 Mar 11:14 PM
Airlines

The move that could destroy Boeing

14 Mar 01:12 AM

But, he added, MAX aircraft were only a small part of the airlines' fleet.

"It's certainly going to be felt, but it's really only a small handful of planes that we're talking about here," Lloyd told Florida's Local 10 News.

Airlines may face a plane shortage, said Ahmed Abdelghany, a professor of operations management at Embry-Riddle Aeronautical University in Florida.

"For every 50, 60 aircraft, you might have one that's coming out of maintenance," he told Time. "Most airlines don't have spare aircraft."

Boeing could lose up to US$7b by grounding all MAX planes, according to Wall Street firms Melius Research and Jefferies.

That sum was based on a three-month grounding of the jets, CNN reported.

Advertisement
Advertise with NZME.

And much of that may be compensating airlines for loss of revenue due to temporarily mothballing their MAX planes and compensation paid to delayed passengers.

Norway's largest airline, low-cost carrier Norwegian Air Shuttle, has already said it would demand a payout from Boeing after it was forced to ground 18 MAX 8 aircraft and cancel 19 flights on Wednesday.

"We're going to send the invoice to those who built the plane," a spokesman for the company, Lasse Sandaker-Nielsen, told AFP.

He said the airline "should not suffer financially from this".

In India, where MAX jets have been grounded by already cash-strapped airlines, airfares for domestic travel may rise by 20 per cent, Bloomberg reported.

But passengers outside of India's struggling airline industry may be spared.

Advertisement
Advertise with NZME.

Airlines would be reviewing their MAX warranties as they brace for "significant impact" from this grounding, Mark Dombroff from US corporate law firm LeClairRyan said.

"The insurers, Boeing, everyone, is reading insurance policies, warranties," he said, according to Yahoo.

"Everyone is reading everything now because all of a sudden an entire fleet worldwide has been grounded. All airlines operating this aeroplane are, or were, impacted to a greater or lesser degree, either cancelling flights or covering flights.

"These airlines are high-usage pieces of equipment. They're flying them seven days a week."

Dombroff said airlines were unlikely to take Boeing to court, given their business with the company, but they would be reviewing "tightly drawn" warranties and making insurance claims.

"They could have potentially significant damages," he said of the airlines.

Advertisement
Advertise with NZME.

The FAA said the decision to ground the MAX — a recent, more energy-efficient version of Boeing's popular 737 — followed the discovery of new, unspecified evidence at the Ethiopia crash site that linked it to a similar fatal crash in Indonesia in October.

It also came amid new reports of pilots' concerns with error messages in the cockpit of MAX 8 planes.

It's not the first time Boeing has grounded an entire global fleet. In 2013, it told airlines to stop flying its 787 Dreamliner because batteries in the plane were catching fire.

The worldwide grounding of the MAX jets has limited impact to passengers flying in Australia. Only two airlines flew the plane into the country: Singapore Airlines' Silk Air and Fiji Airways.

No Australian airline flies MAX aircraft. Virgin Australia, which has 30 Boeing MAX 8 aircraft on order with the first to be delivered in November, said it would not fly any new MAX aircraft until it was "completely satisfied" with its safety.

Save

    Share this article

Latest from Business

Business|companies

New World customers warned after ‘password spraying’ attack

12 Jul 02:39 AM
Premium
Property

Auckland retiree faces eviction as ground rent jumps 344%

12 Jul 12:01 AM
Business|companies

Air India crash: Pilot asked colleague why he cut off fuel control switches seconds after takeoff

11 Jul 10:44 PM

Audi offers a sporty spin on city driving with the A3 Sportback and S3 Sportback

sponsored
Advertisement
Advertise with NZME.

Latest from Business

New World customers warned after ‘password spraying’ attack

New World customers warned after ‘password spraying’ attack

12 Jul 02:39 AM

New World's parent company Foodstuffs says none of its systems were breached.

Premium
Auckland retiree faces eviction as ground rent jumps 344%

Auckland retiree faces eviction as ground rent jumps 344%

12 Jul 12:01 AM
Air India crash: Pilot asked colleague why he cut off fuel control switches seconds after takeoff

Air India crash: Pilot asked colleague why he cut off fuel control switches seconds after takeoff

11 Jul 10:44 PM
Premium
Fran O'Sullivan: New Zealand must move on from Ardern criticism to get real benefit from Covid inquiry

Fran O'Sullivan: New Zealand must move on from Ardern criticism to get real benefit from Covid inquiry

11 Jul 09:00 PM
Gold demand soars amid global turmoil
sponsored

Gold demand soars amid global turmoil

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP