Boeing Co. (BA) - Get Report shares fell the most in more than seven months Friday after a report said the Federal Aviation Administration demanded the planemaker turn over internal communications that questioned the safety of software linked to the grounded 737 MAX jet.
Reuters reported Friday that messages between two Boeing employees, first sent in 2016 but turned over the the FAA by the planemaker earlier this week, noted issues surrounding the anti-stall system in Boeing's MCAS software, which investigators have tied to two deadly crashes that took the lives of 346 passengers. A separate report from the NY Times said the messages centered around a high-level test pilot who admitted lying to the FAA about MCAS safety.
Reuters also reported that the FAA found the messages "concerning" and are reviewing them in order to "determine what action is appropriate", according to statements from the regulator that were quoted by the news agency.
Boeing shares were marked 6% lower following the reports, the biggest single-day decline since the day after the Ethiopian Airlines crash of a 737 MAX in early March, to change hands at $357.14 each, a move that extends the stock's one-month decline to around 10%. Shares in the world's biggest planemaker are down 17.8% since the March 11 disaster.
Last week, falling from the crashes, and the investigations that followed, compelled Boeing to strip CEO Dennis Muilenburg of his chairman role in order to allow his to focus entire on bringing the grounded 737 MAX aircraft back into service.
Boeing said the board has "full confidence in Dennis as CEO", adding that splitting the role of chairman would allow him more time to run the company, focus on product development and safety and marshal the company's ongoing attempt to win FAA approval for the 737 MAX following its grounding earlier this year.
That move followed a statement from American Airlines Group Inc. (AAL) - Get Report that extended cancellations linked to the 737 MAX into at least early January, challenging the planemaker's timetable for its return. Domestic rivals United Airlines (UAL) - Get Report and Southwest Airlines (LUV) - Get Report quickly followed suit.
The flagship aircraft's fate was further complicated by a Wall Street Journal report that suggested European officials aren't satisfied with safety issues related to Boeing's plans to repair the 737 MAX's software, which involves both flight control computers and will address concerns for the system raised by the FAA in June.
Boeing also reported a net order tally of -84 jets for the nine months ending in September, compared to 127 for its European rival Airbus (EADSY) , but said indicated it had converted at least one previous order into a potential 737 MAX deliver.