Just when you thought Boeing was finally going to make sense and move headquarters closer to their operations, they did the opposite and announced a move from Chicago to Washington DC. This is even farther away from Seattle, which has been the nexus of its operations since the company’s inception. While having a headquarters separate from operations is not atypical in many industries, for Boeing employees it has become another symbol of the cultural change within the organization that occurred after the 1997 merger with McDonnell-Douglas. We believe it is another step backward for the company.

Why Washington DC? (Here’s CNN‘s view on this) Perhaps Boeing wants to be closer to a key customer, the US government, and to extend its ability to lobby congress for special considerations. The company is facing a December 31st deadline to certify the MAX10 before a Congressional limitation on grandfathered systems applies. The FAA has stated Boeing is unlikely to meet this deadline, which means it will need to install an EICAS (Engine Indication and Crew Alerting System) for the MAX10, a major change to the cockpit.  While this would be another step backward for the MAX program, it would be a step forward for aviation safety.

This would not only be costly for Boeing, but it would also require additional pilot training on the MAX10 versus the existing MAX8 and 9. Customers might even request that the same system be retrofit to the rest of the MAX family to provide fleet commonality. As this change is likely to cost Boeing more than $1 billion when all is said and done, would being closer to Washington potentially help Boeing’s lobbying and PR efforts?

The Biden administration is unlikely to move at all on this issue, but the political make-up of Congress may change after the mid-term elections. But by the time the next term starts, the deadline will have passed, however. The key question is would Boeing be considered a high enough priority to enact special legislation to enable the MAX10 to grandfather older systems like the MAX8 and 9, or be required to install an EICAS?

The MAX is currently the only currently produced aircraft without an EICAS system, instead, it relies on annunciator lights that date back to the Boeing 707 and the late 1950s in terms of technology. Having a modern crew alerting system is important for aviation safety, particularly for less experienced pilots new to the 737.  While the MAX program has been another step backward for Boeing, the delays to the MAX10 will likely result in new requirements that could impact airline orders and damage the future of that program.

Moving further away from the problems, rather than closer to the engineers in Seattle to address issues head-on, illustrates that Boeing management isn’t as focused on operational improvement as it should be in the near term. The FAA suspended Boeing’s authority to issue airworthiness certificates under its long-standing production certificate, taking back that responsibility for the 737 MAX and 787 programs. The issues with Boeing’s quality system have not been resolved to the satisfaction of the FAA, which continues to inspect and individually certify aircraft coming off the production lines in Renton and Charleston.

During the certification of the MAX8, it became clear that Boeing misled the FAA and misrepresented the severity of the MCAS system to the government. The relationship with the FAA has turned upside down, with the FAA clearly back in charge of the regulatory process, as it should be. Will moving to Washington DC provide Boeing with the ability to lobby the FAA and federal government more easily for what it needs? Perhaps.

Or is it that Boeing needs to be closer to the seats of power in the Military-Industrial-Government complex as a major defense contractor? Whatever the cause, the move to Washington DC rather than Washington State will likely not benefit Boeing’s Commercial Airplanes operation nor their long-term presence in Puget Sound.

Just when you thought Boeing was finally going to make sense and move headquarters closer to their operations, they did the opposite and announced a move from Chicago to Washington DC. This is even farther away from Seattle, which has been the nexus of its operations since the company’s inception. While having a headquarters separate from operations is not atypical in many industries, for Boeing employees it has become another symbol of the cultural change within the organization that occurred after the 1997 merger with McDonnell-Douglas. We believe it is another step backward for the company.


Subscriber content – Sign in Subscribe    

%d bloggers like this: