Commentary

Boeing Hit With Growing Concerns Over Safety Of Its Cash Cow

With Australia and Singapore this morning joining China, Indonesia, Ethiopia and several airlines in grounding its new 737 MAX 8 aircraft from flying in and out of their airports, Chicago-based Boeing Co. is facing a mounting crisis of confidence in its most lucrative product.

“The crash of a Boeing 737 MAX in Ethiopia on Sunday killed all 157 people on board. The latest incident follows another deadly accident in Indonesia last October, when 189 people were killed in a Lion Air flight crash,” writes Amy Gunia for Time.

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“Similarities between the crashes have called the safety of the aircraft into question. In both situations, the planes, which were new, crashed just minutes after takeoff after the pilots had requested to return to the takeoff airport after experiencing difficulties,” she continues.

“The 737 MAX is the newest version of the 737, the best-selling airliner ever. Since debuting in 2017, Boeing has delivered more than 350 of them in several versions that vary by size. Dozens of airlines around the world have embraced the plane for its fuel efficiency and utility for short and medium-haul flights,” writes the AP’s David Koenig.

“For Boeing, the MAX is its cash cow. Soon all the 737s assembled in its Renton [Wash.] plant will be MAXes, due to be pumped out later this year at a rate of 57 jets per month,” Dominic Gates reports for the Seattle Times.

“Being a new airplane, and with the tragedy in Indonesia a few months ago, they need to find out if there is a connection or not,” John Cox, founder and CEO of Safety Operating Systems, tells Gates. “There’s a sense of urgency.”

The grounding by China, in particular, “is very significant, as this is a major market for Boeing,” Greg Waldron, Asia managing editor at aviation research firm FlightGlobal tells CNN Business’ Chris Isidore. “China’s airline regulator said Sunday it had ‘zero tolerance for safety hazards,’” Isidore writes.

“Following the Ethiopia incident, Boeing released a statement saying it is ‘deeply saddened’ by the news and added that a Boeing technical team will be traveling to the crash site to provide technical assistance under the direction of the Ethiopia Accident Investigation Bureau and U.S. National Transportation Safety Board (NTSB),” Jade Scipioni writes for Fox Business.

Last night, Boeing issued a statement “saying that since the Lion Air crash, the company had been developing a ‘flight control software enhancement for the 737 MAX, designed to make an already safe aircraft even safer.’ According to the company, it has been working with the FAA to roll out the software updates across the 737 MAX fleet in the coming weeks,” the New York Times reports.

“Southwest Airlines, which operates 34 of the planes, said on Twitter that the airline had completed 31,000 flights using the model and planned to move forward with them. American Airlines, which has 22 of the planes, doesn't plan to ground them, either, even as the union representing its flight attendants issued a bulletin detailing its concerns,” Kristin Lam writes for USA Today

“U.S. senators Dianne Feinstein (D-Calif.) and Richard Blumenthal (D-Conn.) called on the Federal Aviation Administration and the airline industry to take precautionary measures,” she continues. “Until the cause of the crash is known and it’s clear that similar risks aren’t present in the domestic fleet, I believe all Boeing 737 MAX 8 series aircraft operating in the United States should be temporarily grounded,” Feinstein wrote.

But that’s not happening, at least at present. The U.S. Federal Aviation Administration yesterday tweeted that it also had a team at the crash site to collect data but that it was issuing a “Continued Airworthiness Notification to the International Community (CANIC) for Boeing 737 MAX operations.” 

Meanwhile, “anxious passengers booked on the same model of plane … are being denied refunds or transfers if they are too scared to fly. Norwegian and TUI airlines are both continuing to run Boeing 737 MAX 8 planes and said its standard terms and conditions will apply to all passengers, with no special dispensation offered to those worried about safety,” Chris Graham and Laura FitzPatrick report for The Telegraph in the U.K.

“This international discrepancy -- in which some airlines are grounding their planes and others aren’t -- has prompted concerns from travelers, some of whom have taken to social media to correspond with airlines to identify the aircraft for their flights. Boeing’s stock dropped by 13% on Monday, but bounced back to around 5% by the end of the day -- hinting that the company may be facing a PR crisis,” Nicole Karlis writes for Salon.

I’d suggest that crisis has already happened.

1 comment about "Boeing Hit With Growing Concerns Over Safety Of Its Cash Cow".
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  1. Nina Lentini from MediaPost Communications, March 12, 2019 at 9:19 a.m.

    Excellent suggestion, Thom!

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