Lion Air has been viewed as a risk for several years. Not a safety risk as much as a business risk for Boeing. Though as an airline with above-average accident rates (here also), the safety issue cannot be dismissed.
Lion Air is an airline that started business in 1999. In its 19 years of operating, the airline has grown fast. It is a privately owned company based in Indonesia. Indonesia is a large country by land expanse – it is nearly 3,200 miles wide. Because it is an archipelago the country needs air service to reach its various disparate population locations.
Lion Air has a spotty safety record and the airline failed its first IATA audit in 2011. But its ambitions are big – in November 2011 the airline a record-setting order of 201 737 MAX and 29 737-900ER aircraft. This set a record for the world’s biggest single order of 230 planes for a commercial airline worth $21.7Bn. The airline focused on improvements and was removed from the EU list of banned airlines in 2016.
This week’s crash has highlighted the airline’s vulnerabilities. Australia has imposed restrictions on its officials flying Lion Air after Monday’s crash.
The airline, as a large customer, represents a potential risk to Boeing. The table below shows that all of the airline’s single-aisle fleet comes from Boeing. Of published MAX orders, Lion accounts for 4.2%, which ranks third among the named customers for the MAX after Southwest and flyDubai.
If Lion has to delay or cancel some of those orders, Boeing could quite likely place them with other customers. Reaction to the recent crash has focused on the airline rather than on the 737 MAX, which is performing well at other airlines. Because Lion has crashed earlier 737 modes with strong safety records at other carriers, initial reactions point to the airline rather than the aircraft.
Nonetheless, something did happen to cause an unusual flight pattern after takeoff, the loss of control, and a power on dive into the water. Â Once the flight data recorders are recovered, we’ll have a better understanding of what happened, as it is quite premature to speculate on likely causes. Â Nonetheless, risk seems to be assigned to the airline, rather than the airplane in this case. Â Is that instinct to blame an airline that has crashed before correct? Â It remains way too early to tell.
Co-Founder AirInsight. My previous life includes stints at Shell South Africa, CIC Research, and PA Consulting. Got bitten by the aviation bug and ended up an Avgeek. Then the data bug got me, making me a curious Avgeek seeking data-driven logic. Also, I appreciate conversations with smart people from whom I learn so much. Summary: I am very fortunate to work with and converse with great people.
