- The crash of Ethiopian Airlines Flight ET302 on Sunday once again shined the spotlight on Boeing's 737 Max program.
- It was the second nearly brand-new Boeing 737 Max 8 airliner involved in a fatal crash in the past five months.
- Many airlines have decided to ground their Boeing 737 Max fleets. Some safety regulators have outright banned the plane from entering their airspace.
- According to Moody's, Boeing's operating profit margin is $12 million to $15 million on every 737 Max it delivers.
Sunday's crash of Ethiopian Airlines Flight ET302 once again shined the spotlight on Boeing's 737 Max program.
The crash killed all 157 passengers and crew members on board the four-month-old plane.
It was the second nearly brand-new Boeing 737 Max 8 airliner involved in a fatal crash in the past five months. In October, Lion Air Flight JT610 crashed in the Java Sea shortly after taking off from Jakarta, Indonesia, killing all 189 people on board.
Many airlines decided this week to ground their Boeing 737 Max fleets. Some safety regulators have outright banned the plane from entering their airspace.
Boeing, the US Federal Aviation Administration, and the plane's US operators have stood by their assessment of it as airworthy.
The Max is the fourth and latest generation of the Boeing 737 airliner. The plane's importance to Boeing's bottom line cannot be overstated.
"The 737 is very profitable to Boeing because of the high volume, the resulting production efficiencies and the amortization of the capital investment over the program's decades," Moody's said in a note on Wednesday.
The credit-rating agency estimated that Boeing's operating profit margin is $12 million to $15 million on each 737 Max 8 it delivers to customers.
"Boeing does not disclose specifics, but we estimate that the average operating margin dollars recognized for each delivery of a Max 8 aircraft at between $12 million and at least $15 million or more even at this point in the model's life," Moody's said.
Boeing was not immediately available for comment.
Boeing lists the 737 Max 8 at $121.6 million. According to industry research from Teal Group, buyers usually receive a discount of 50% to 55% on the planes.
The 737 Max is built alongside the previous-generation 737NG (Boeing 737-600, -700, -800, and -900) at Boeing's factory in Renton, Washington.
By the end of 2018, Boeing had ramped up production of the 737 to 52 aircraft a month. It said it planned to produce 57 a month this year.
Last year, Boeing delivered 256 Max aircraft to customers, representing nearly half of all 737 deliveries.
Boeing Commercial Airplanes, the company's airliner division, has a backlog of 5,870 planes - including 4,699 undelivered 737s - valued at more than $400 billion.