Boeing shares plunge after Air India 787 crash kills over 200

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Boeing shares fell sharply on June 12, 2025, after an Air India Boeing 787 Dreamliner crashed shortly after takeoff from Ahmedabad, killing over 200 people and marking the first fatal accident involving this aircraft model since its 2011 debut. According to multiple reports, the tragedy has renewed scrutiny of Boeing’s safety record and cast a shadow over the company’s recent stock rally and efforts to rebuild trust under new leadership.

Deadliest Air India Disaster

A London-bound Air India flight carrying 242 people crashed minutes after takeoff from Ahmedabad on June 12, 2025, marking the first fatal accident for the Boeing 787 Dreamliner. The aircraft reached only 625 feet before plummeting into the Meghani Nagar neighborhood, colliding with a medical college hostel and igniting a massive fireball. Rescue teams rushed to the densely populated crash site, where over 200 fatalities were reported, including passengers, crew, and at least five people on the ground. Only one survivor, a British national, was found alive and is under treatment. A mayday call was issued, but air traffic controllers received no further response from the cockpit. The cause remains under investigation, with Indian and international agencies, including the U.S. National Transportation Safety Board, involved in the probe.

Market Reaction to Crash

The market reaction to the Air India crash was swift and severe. Shares of the aerospace giant plunged as much as 8% in pre-market trading, hitting lows near $197.58 —a sharp drop from the previous close of $214.00. By midday, the stock was still down over 4%, wiping out more than $11 billion in market capitalization and leading the S&P 500's decliners. The selloff also dragged down related stocks, including suppliers and domestic airline shares, as investor anxiety spread across the sector. This abrupt reversal halted a months-long rally that had seen the stock surge more than 20% year-to-date, as optimism about a turnaround gave way to renewed fears over safety and regulatory scrutiny.

Future Prospects and Risks

Analysts and investors are bracing for turbulence in the near term, as the Air India crash reignites concerns over safety and regulatory risk. While some, like RBC Capital’s Ken Herbert, have maintained an "outperform" rating and a price target of $230, the consensus is that investigations could weigh on sentiment and trigger further volatility. The crash’s status as the first fatal incident for the 787 Dreamliner adds a layer of uncertainty, but early commentary from industry observers suggests it’s too soon to pin blame on a systemic design flaw, and fair value estimates for Boeing remain unchanged for now.

In the coming months, the stock’s trajectory will hinge on several factors: 

• Results of the ongoing crash investigation and any potential findings of manufacturing or design issues
• Regulatory responses and possible new safety mandates
• The pace of new aircraft orders and deliveries, especially as airlines and leasing companies reassess fleet plans
• Broader market sentiment toward aerospace and defense stocks, which have recently outperformed the S&P 500
• For now, Boeing’s recovery narrative is on pause, and investors should expect headline-driven swings until the dust settles and the root cause of the tragedy becomes clear.