(News Bulletin 247) – Shares of the South Korean company hit a historic low the day after the largest air disaster in South Korean history involving one of its aircraft. Boeing shares are down in pre-opening trading on Wall Street.
Jeju Air shares are at a historic low on the Seoul Stock Exchange after the crash of one of its planes this Sunday in South Korea.
A Jeju Air plane arriving from Bangkok’s Suvarnabhumi International Airport crashed at South Korea’s Muan International Airport on Sunday, killing 179 people out of 181 passengers. It is the deadliest air disaster in South Korea, likely caused by a plane collision with birds.
Jeju Air at historic low
On the Seoul Stock Exchange, Jeju Air shares lost up to 15.7%, falling to 6,920 won (4.49 euros), its lowest level since its IPO in 2015. At the height of the session , Jeju Air thus erased up to 95.7 billion won, or 65.2 million euros in market capitalization. Jeju Air closed Monday’s session down 8.65% to 7,500 won (4.87 euros) while AK Holdings shares, the airline’s parent company, fell 12.12%. .
“It will take time to assess the causes of the accident, but consumer sentiment will inevitably be affected, as credibility is important for low-cost carriers whose seats and services are not very different from each other” , Yang Seung-yoon, an analyst at Eugene Investment Securities, told Reuters.
Jeju Air announced that it was suffering a series of cancellations in the aftermath of this air disaster, an anonymous source told AFP.
Boeing stock in decline
On Monday morning, another Jeju Air plane that took off from the northwest Gimpo International Airport was forced to turn around after encountering a landing gear problem, a security official said. – Jeju Air spokesperson on Monday. The Jeju Air spokesperson did not confirm the model of the plane involved, but according to the South Korean news agency Yonhap News, it was a Boeing 737-800, the same model involved in Sunday’s plane crash.
“The captain communicated with ground control and, after taking additional measures, the landing gear returned to normal operation. However, it was decided to return to Gimpo Airport shortly after takeoff,” Song Kyung-hoon, a company official, told the press.
South Korea launched this Monday “a comprehensive inspection” of all Boeing B737-800s used by the country’s airlines following the accident at Muan airport.
On Wall Street, Boeing shares are expected to fall sharply after this air disaster. They are down 4.7% in pre-opening trading on Monday.
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