WRAPUP 4-Boeing delivers 737 MAX jet to China, a vote of confidence amid turmoil

However, the trajectory of future deliveries remains uncertain, and it's unclear whether the event represents a real reset of Boeing's relationship with China or a temporary political concession. The Jan. 5 mid-air incident on an Alaska Airlines flight has kicked up a storm of scrutiny around the aircraft maker, one of two major suppliers to the industry along with Airbus.

Boeing delivered its first 737 MAX to a Chinese airline since March 2019 on Wednesday, flight data showed, ending an almost five-year freeze on imports of the U.S. planemaker's most profitable product in a respite for severely strained trade relations between the world's two largest economies. The delivery represents a vote of confidence for Boeing during a difficult period for the planemaker following a Jan. 5 mid-air cabin blowout during a full flight. No one was killed in the incident, but regulators and industry insiders are applying new scrutiny to the planemaker's manufacturing and quality control processes as a result.

The delivery is a rare bit of positive news of late for Boeing, as it symbolizes the re-opening of doors to China, one of the fastest-growing aerospace markets, which the company projects will account for 20% of the world's aircraft demand through 2042. It was China that was initially the most aggressive in responding to a pair of fatal crashes in 2018 and 2019 of MAX planes that killed nearly 350 people. Regulators in that country grounded the jets before other national regulators, and while safety bans had been lifted with existing MAX already flying inside China, new deliveries had remained on hold.

A 737 MAX 8 for China Southern Airlines departed from Seattle Boeing field in Washington state at 11.56 a.m. Pacific Time (2:56 p.m. ET) for Honolulu, flight data from FlightRadar 24 shows, before its final destination in China. Boeing did not respond to a request for comment.

The MAX handover comes after Boeing in December made its first direct delivery of a 787 Dreamliner to a Chinese customer since 2019. However, the trajectory of future deliveries remains uncertain, and it's unclear whether the event represents a real reset of Boeing's relationship with China or a temporary political concession.

The Jan. 5 mid-air incident on an Alaska Airlines flight has kicked up a storm of scrutiny around the aircraft maker, one of two major suppliers to the industry along with Airbus. While nobody was seriously injured, the FAA grounded 171 MAX 9s, and the planes have not yet been approved to fly again. Management has been trying to assuage lawmakers and assure employees that it will handle its production issues.

Boeing CEO Dave Calhoun briefed senators on the Alaska Airlines incident in a series of meetings on Wednesday on Capitol Hill. "We don't put planes in the air that we don't have 100% confidence in," Calhoun told reporters before one engagement, adding that he recognizes the "gravity of the situation."

U.S. Senator Jerry Moran on Wednesday said that Boeing had reached a point where it understood the cause of the Alaska Airlines blowout, but the planemaker's chief executive did not provide any detail in the meeting, he said. Boeing will pause production and delivery operations at the Seattle-area location where it makes 737 aircraft on Thursday so employees can attend quality workshops and evaluate its operations, the company said.

Boeing shares rose 1.2% on Wednesday. POLITICAL TENSIONS

Analysts had speculated Boeing was close to delivering a MAX jet to China in December based on flight testing and other preparatory activities that are typically seen on flight radar before a plane is handed over to a customer. Following the Alaska Airlines accident, Wall Street analysts questioned whether China would be willing to accept a 737 MAX during a major period of turmoil for the U.S. planemaker, which has frequently found itself in the crosshairs of U.S.-China geopolitical tensions.

China was the first nation to ground the 737 MAX in March 2019 and has been slow to resume its relationship with Boeing amid growing trade and geopolitical friction between Washington and Beijing. The restart of Chinese 737 MAX passenger flights in January 2023 provided some positive momentum.

Business relationships between the United States and China further thawed following U.S. Commerce Secretary Gina Raimondo's visit to China in August and talks between U.S. President Joe Biden and Chinese President Xi Jinping in November. Biden raised the topic of resuming Boeing plane deliveries, Raimondo told Reuters in December. However, orders of Boeing jets remained largely stalled. Hong Kong's Greater Bay Airlines was the sole Chinese carrier to buy Boeing airplanes in 2023, announcing a deal for 15 737 MAX jets in March. Between 2018 and 2022, Chinese customers booked orders for only 25 Boeing planes, with sales dominated by cargo aircraft, according to Boeing data.

Analysts say a full rollout of the MAX line-up is crucial to help Boeing stabilize its roughly 40% share against Airbus and generate sufficient cash. (Reporting By Valerie Insinna; additional reporting by Nathan Gomes in Bengaluru; Editing by David Gaffen and Emelia Sithole-Matarise)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)