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Alaska Air shares down
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February 1, 2000: 12:38 p.m. ET
Shares of low-cost carrier, as well as Boeing, are off in wake of fatal crash
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NEW YORK (CNNfn) - Shares of Alaska Air Group Inc. and aircraft manufacturer Boeing Co. were down Tuesday morning in wake of the fatal crash Monday night of an Alaska Airlines flight off the California coast.
The MD-83 jet with 83 passengers and a crew of five aboard crashed while on a flight from Puerto Vallarta, Mexico to San Francisco, after the pilot radioed of trouble with stabilizer trim and asked to land in Los Angeles.
A park ranger on a nearby island saw it plunge into the ocean nose first just before 8 p.m. ET. Searchers had not found any survivors as of Tuesday morning, but they believed they had found the location of the "black box" voice and data recorders needed in the investigation of the cause of the crash.
 Alaska Airlines, the nation's 10th largest carrier, has a very strong safety record. The crash marked the carrier's first fatality in almost 24 years, when one passenger died when a jet overran a runway in Ketchikan, Alaska.
Despite that strong record, investor concern about the impact of the crash on the carrier sent its stock sharply lower in early trading Tuesday.
The stock of the Alaska Air (ALK: Research, Estimates) was trading down 1-11/16, or 5 percent, to 30-3/16 in late morning trading, although that was up from the low of the day of 29-1/2.
Stock of Dow component Boeing (BA: Research, Estimates), which manufacturers the former McDonnell Douglas MD-80 series of jets, was off 1-1/8, or 2.5 percent, to 43-1/8. In addition to the crash, Boeing is facing the possibility of a strike by 22,500 unionized engineering and technical employees on Thursday.
"Neither item is good news, so you can't say it's one or another," said Chris Mecray, analyst with Deutsche Banc Alex. Brown, about the Boeing stock. "A plane crashes can always impact the stock, but it's probably not a big problem given the strong safety record of that aircraft."
Airline analysts did not want to comment on the stock implications of the crash for Alaska Air Group Tuesday while emergency crews were still searching for possible survivors as well as clues to the crash.
Safety experts, such as Kieran Daly, editor of Air Transport International, say there is no indication of problems with the stabilizer on the MD-80 that would cause a crash, or any extensive grounding or changes of the planes.
"This kind of technology that's on it is really very, very simple; there's no complex computerization involved," he said in an interview on CNNfn Tuesday morning. "If it is that kind of failure, then we will be looking at something relatively mechanically simple." (173KB AIFF) (173KB WAV)
An estimated 30 of the passengers were employees, family or friends of Alaska Airlines or Horizon Air, according to airline officials. John Kelly, the company's chief executive, said the crash was unlike anything in his or other employees' experience. (311KB AIFF) (311KB WAV)
Low-cost carrier Alaska Airlines, and its sister airline Horizon Air, serve 62 U.S. cities, mostly on the West Coast, and 11 international destinations. Preliminary financial statistics show that net income at the carrier was $134.2 million, or $5.06 a share, in 1999, up from $124.4 million, or $4.81 a share, in 1998. Revenue rose to $2.1 billion from $1.9 billion in 1998.
The 1996 crash of a Valujet plane in the Florida Everglades virtually doomed that discount carrier; the crash also hurt sales at other discount carriers due to passenger fears.
Airline stocks and earnings have all been under pressure in recent months due to soaring fuel prices. 
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