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ERROR: type should be string, got "https://www.barrons.com/articles/the-boeing-737-max-delay-drags-on-heres-what-that-means-for-aerospace-51561741985\nThe Boeing 737 MAX Delay Drags On. Here’s What That Means for Aerospace.\nAl Root\nWednesday evening, Boeing disclosed new issues identified by the Federal Aviation Administration that could extend the world-wide grounding of the 737 MAX jet, which hasn’t flown commercially since mid-March. Thursday evening, reports emerged estimating those issues could keep the plane out of the skies until late 2019—months later than Wall Street currently expects. If that’s the case, the 737 MAX woes could become a new headwind for the aerospace sector.\nThe aerospace sector has weathered the 737 MAX problems well, despite an April decision by Boeing (ticker: BA) to slow 737 MAX production from 52 planes a month to 42 planes a month. Commercial aerospace suppliers Barron’s tracks are up more than 12% since the tragic March 10 crash of an Ethiopian Airlines flight, better than the 4% gain of the Dow Jones Industrial Average over the same span. What’s more, aerospace and defense stocks are up almost 25% on average in 2019, better than the 14% rise of the Dow. One exception is Spirit AeroSystems Holdings (SPR), down 17% since March 8, the last trading day before the second crash. Spirit derives almost 80% of its sales from Boeing.\nThe back story. The aerospace industry has been fine, in part, because the industry is more than just one narrow-body jet, like the 737 MAX.\nBoeing’s MAX production-rate decrease was mentioned by aerospace management teams during first-quarter-earnings conference calls, but no diversified aerospace supplier cut sales or earnings guidance because of the 737 production slowdown. In fact, most management teams said aerospace was strong when commenting on conference calls.\nWhat’s new. Still, longer delays means less cash flow for Boeing.\nBarclays analyst Julian Mitchell, for instance, expects MAX deliveries resume in the fourth quarter and ramp to 57 planes a month by 2021. What’ more he estimates the 737 woes will cost Boeing $10 billion in cash flow this year, reversing in later years, becoming a $5 billion tailwind to his prior estimates in 2020.\nThose numbers, and others like it on Wall Street, will have to be revisited based on the new reporting. “The [timeline] is up in the air,” Richard Aboulafia, vice president at aviation intelligence firm Teal Group, told Barron’s.\nOnly severe cuts to production, however, will likely be enough to break Boeing stock out of its postcrash trading range. Shares have traded between about $340 and $380 since the Ethiopian Airline accident, down from about $420 before the crash.\nLooking ahead. It’s possible that new delays will force Boeing to cut production of the MAX jet again. Boeing didn’t answer questions about production rates, noting the company was in its quiet period before second-quarter earnings on July 24. A company official did confirm Boeing plans to submit all changes to the FAA for certification in September.\n“We do believe this delay does increase the chances that Boeing could in fact go lower than the 42 [units] a month rate on the 737 it is currently running at,” wrote Canaccord Genuity analyst Ken Herbert in a Friday research report addressing Thursday’s news. “But we continue to view this as a very low probability.”\nStill, a deep-enough cut could impact aerospace-industry financial guidance, however, it’s unlikely investors will punish the diversified suppliers. After all, the industry, and Boeing’s airline customers, still expect the MAX to fly again. Don’t forget International Consolidated Airlines (IAG.London) signed a letter of intent for 200 MAX jets, worth more than $24 billion at list prices, during the June Paris Air show.\n(Curiously, in its press release there were no references to the MAX. IAG only referred to the model numbers: 737-8 and 737-10)\nGol Linhas Aéreas Inteligentes (GOL), the Brazilian equivalent of Southwest Airlines (LUV), which flies an all-Boeing 737 fleet, wasn’t available for comment about new delays. Southwest Airlines told Barron’s on Wednesday it “is aware of Boeing’s work with the FAA to implement a required modification to the proposed software enhancement for the 737 MAX.”\nWrite to Al Root at allen.root@dowjones.com\nWednesday evening, Boeing disclosed new issues identified by the Federal Aviation Administration that could extend the world-wide grounding of the 737 MAX jet, which hasn’t flown commercially since mid-March."