Senate Commerce Committee to hold hearing on aircraft certification
The United States Senate Commerce Committee will today hold a hearing considering legislation to tighten oversight of commercial aircraft manufacturers.
The current bill would grant the Federal Aviation Administration new prerogatives over airplane manufacturers’ safety certification process. Boeing, mired in controversy following two 737 MAX crashes, looks to be significantly affected by the proposed legislation. However, with the company’s plummeting sales, coupled with COVID-19’s depression of air travel, Boeing has little recourse in lobbying against today’s legislation. Still, as the US manufacturer’s main rival Airbus faces deep cuts, competition within the global aviation industry remains fierce.
Since the bill is bipartisan and hasn’t faced pushback from Boeing, expect today’s hearing not to make significant changes to the proposed legislation. When passed, the bill will likely affect Boeing positively by restoring consumer confidence in the company. These much-needed regulations will put Boeing on even footing with competitor Airbus, but expect Airbus stock to continue to outperform Boeing as the company salvages its reputation. Overall, since COVID-19 is expected to depress passenger traffic until 2024, Boeing’s return to its golden 2018 sales figures is increasingly unlikely in the medium-to-long term.
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