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Daily Insight: Wednesday 15 May 2019: Boeing – Piling On?

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News

The headlines for Boeing keep getting worse.    Today, new revelations emerged:

  • A tape recording emerged of a meeting between Boeing and American Airlines pilots that became contentious after the Lion Air crash but before the Ethiopian crash
  • Boeing has begun to store new 737MAX aircraft in Texas as it has run out of space in Seattle.
  • TUI, a European airline, reported millions in losses, partly attributed to the MAX grounding and needs clarity on a return to service as it adjusts short-term leases.
  • American’s CEO indicates that he would fly on a MAX once regulators approve a return to service and American’s pilots are comfortable in flying it.
  • Chinese carriers are considering banding together for a joint claim against Boeing for the MAX groundings.
  • Boeing reported four orders in April, despite news to contrary.
  • The FAA is also being grilled in Congress about the certification process that let the MAX flaws fall between the cracks.

The news cycle continues to be full of new revelations about Boeing

that emerge on almost a daily basis, as the 737MAX is clearly on the radar of investigative journalists.  Most of the revelations are unfavorable to Boeing and the decision processes in the development of the MAX.  As more of these revelations emerge, expectations for a return to service before fall 2019 are fading.

Analysis

There were mistakes made in the development of the 737MAX and its certification that are currently being rectified.  That is what usually happens.  But what doesn’t typically happen is a drip-drip-drip of revelations that place the OEM in a bad light on a near daily basis.  That appears to be happening for two reasons – first, Boeing’s lack of transparency in explaining the events that led up to the crash.  While Boeing has indicated that it “owns the problem,” its behavior in criticizing flight operations and citing a multiplicity of factors, including blaming the pilots, does not sit well with the industry.  Second,  Boeing’s lack of transparency with the MCAS system, failing to tell either airlines or pilots that it even existed, much less could result in an uncontrollable situation in the event a single sensor failed.

The headlines for Boeing keep getting worse.    Today, new revelations emerged: 

  • A tape recording of a meeting between Boeing and American Airlines pilots that became contentious after the Lion Air crash but before the Ethiopian crash.
  • Boeing has begun to store new 737MAX aircraft in Texas as it has run out of space in Seattle.  
  • TUI, a European airline, reported millions in losses, partly attributed to the MAX grounding and needs clarity on a return to service as it adjusts short-term leases.
  • American’s CEO indicates that he would fly on a MAX once regulators approve a return to service and American’s pilots are comfortable in flying it. 
  • Chinese carriers are considering banding together for a joint claim against Boeing for the MAX groundings.
  • Boeing reported few orders  in April, despite the news.  
  • The FAA is also being grilled in Congress about the certification process that let the MAX flaws fall between the cracks.

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