Boeing HQ
Today’s headlines focus on a potential electrical flaw in Boeing 777s that could result in a fuel tank explosion. In the current environment, this threat has been sensationalized as the press, particularly the UK tabloids, jump on the anti-Boeing bandwagon. In reality, this airworthiness directive is not an immediate safety of flight issue, and the 292 airplanes at risk in the US have five years to complete the modifications.
If the risks were as severe as the media make them out to be, the FAA would have mandated grounding rather than five years to fix the problem on one of the safest aircraft ever built. Working in Boeing PR must be a thankless job refuting tabloid style journalism, particularly as it causes celebrities, in this case the rapper 50 Cent, to boycott Boeing aircraft. Airworthiness Directives are routine, happen to both Boeing and Airbus, and take into account everything the industry learns through millions of hours of safe flying to keep aircraft safer.
Boeing also expects cash flow to be negative for the year, a significant and negative revision to their prior outlook. Previously Boeing was expecting strong cash generation in the last half of the year, but it now appears that the 2nd quarter will be worse than the first quarter, rather than significantly better. Boeing had a free cash flow burn of $3.9 billion in the first quarter.
In other news, the Starliner has been pushed back again until after June 1st for its manned launch, and sounds a lot like Project Mercury in the 1960s with multiple delays. China is rejecting delivery of already build 737 MAX aircraft on batter issues, with CAAC, the Chinese regulator, causing delays. Unfortunately, that doesn’t help Boeing’s short-term cash flow.
Links to today’s key stories follow, but please be aware of the over-sensationalized story in the Daily Mail.
- Exclusive -Revealed: 300 Boeing planes used by United and American Airlines have potential flaw that could cause jets to explode ‘fire or explosion,’ according to FAA – Daily Mail
- Boeing faces fresh safety concerns over electrical flaw in 777 aircraft that could cause ‘fuel tank explosion’ – MSN
- 50 Cent is done flying commercial as Boeing planes hit with new fatal flaw – hot new hip hop
- Boeing now expects net cash outflow in 2024 – AirInsight
- 1st astronaut launch of Boeing’s Starliner capsule now targeted for June 1 – Space.com
- Boeing’s China-bound planes are stuck in regulatory limbo – Quartz
- Boeing faces ‘long road’ on safety issues, US FAA says – Reuters on MSN
- Boeing firefighters reject latest contract offer as lockout drags on – Seattle Times
- Westjet turning to used plane market to offset Boeing delivery delays: CEO – Times Colonist
- Iconic Olympic Airways era Boeing jet on show at Elliniko – Tovima
In other news, the FAA administration said Boeing faces a ‘long road’ on safety issues, with their comprehensive plan due at the end of the month. We expect the FAA to take about 90 days to review the adequacy of that plan, with any meaningful product rate ramp-ups occurring in the fourth quarter.
Boeing firefighters have rejected the company’s latest offer, while WestJet airlines is turning to the used aircraft market to offset Boeing’s delivery delays with the 737 MAX. Finally, a restored Boeing 727 is on permanent display in Olympic Airways colors at Elliniko Airport in Athens, a tribute to the classic short to medium haul route builder.
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