Shares of Boeing Co
Analysts estimated Boeing could continue to burn around $1 billion a month despite the halt in work on what was previously its best-selling plane, and investors worried layoffs, lost work and logistical costs would ripple through its supply chain.
The 737 MAX has been grounded since March after two crashes in Indonesia and Ethiopia killed 346 people within five months, costing the manufacturer more than $9 billion so far.
"Each supplier will likely be missing about 200 deliveries versus original plans, with about 80% of the shortfall coming in 2020 and the remainder in 2021," Melius Research analyst Carter Copeland wrote in a note.
Britain's Senior Plc
The fallout extended to carriers, with Southwest Airlines Co
The US planemaker's shares fell more than 1% in early trading, while its top supplier, Spirit AeroSystems Holdings Inc
Analysts say the US-based Spirit, which makes the MAX's fuselage, draws more than 50% of its annual sales from the plane.
"We assume (Spirit) will elect to stop production and furlough employees at a cost of $0.40 per month of the stoppage," Copeland said.
Spirit said it was working with Boeing to determine the financial implication of the production halt.
"We believe the suspension will likely last a minimum of 3-6 months but would not be surprised if it lasted longer," said SunTrust Robinson Humphrey analyst Michael Ciarmoli.
Shares of Senior, whose aerospace unit counts Boeing as its biggest customer with 15% of the division's sales, fell more than 10%. Those in France's Safran SA
Safran has warned that if the aircraft's grounding lasts until the end of the year, its cash conversion could dip below its targeted 50-55% range of recurring operating income.
Unlike most suppliers, it is paid mostly once the airplanes are delivered to the buyer.
GE has estimated the MAX grounding would reduce its cash flow by $1.4 billion in 2019. Its shares were down marginally at $11.16.
Canaccord Genuity analyst Ken Herbert said there will be "some step-down in production across the supply chain", but he believes that Boeing will continue to absorb much of the financial impact and will keep its supply chain relatively supported.
United Technologies Corp
Shares of other suppliers such as wing flaps maker Ducommun Inc
Other smaller suppliers, including Melrose Industries
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