What happened
Shares in aviation giant Boeing (BA 0.03%) were up by almost 7% as of 1 p.m. ET Thursday. The move comes after the company received a couple of pieces of much-needed good news.
First, the German government announced it would buy 60 Chinook helicopters from Boeing as part of its plan to increase military spending. The deal is rumored to be potentially worth more than $4 billion for Boeing. Its significance can be seen in the fact that Boeing's rival for the order, Lockheed Martin, saw its stock decline on an otherwise solid day for the market.
Image source: Getty Images.
Second, Delta Air Lines CEO Ed Bastian confirmed that the airline is still talking with Boeing about a significant order for the 737 MAX.
So what
The two pieces of positive news are exactly what Boeing needs right now. The defense orders confirm Boeing's place as a beneficiary of a potential uptick in military spending in the wake of the conflict in Ukraine. In addition, a possible Delta order for the 737 MAX program would restore a lot of confidence in the airplane, not least after two leading industry figures, the CEOs of Avolon (a leasing company) and Ryanair (a major European budget airline), made critical comments about the company recently.
Now what
Boeing needs to carry on winning orders in this manner to restore confidence among investors. In addition, the company will hopefully find a way to ramp production on the 737 MAX, overcome production issues on the 787, and ultimately get the 777X delivered on time in 2025.
