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   Technology StocksBoeing keeps setting new highs! When will it split?


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To: Jamie153 who wrote (3444)10/27/2019 1:02:37 PM
From: Jeff Vayda
1 Recommendation   of 3517
 
So you posted after you were already 'done' with them? Nice to see you are saving us from corrupt leadership - good thing you dont have any vested interest in the dealings.

As I said before - Fly the damn plane. No one should be in the cockpit of a commercial airliner if they do not have a functional understanding of aerodynamics. Boeing is not without blame, there is plenty to go around. The airlines -- rushing to fill seats (in and out of the cockpit) -- cant escape their shortcomings either.

"As the Lion Air crew fought to control their diving Boeing Co. 737 Max 8, they got help from an unexpected source: an off-duty pilot who happened to be riding in the cockpit.

That extra pilot, who was seated in the cockpit jumpseat, correctly diagnosed the problem and told the crew how to disable a malfunctioning flight-control system and save the plane, according to two people familiar with Indonesia’s investigation.

The next day, under command of a different crew facing what investigators said was an identical malfunction, the jetliner crashed into the Java Sea killing all 189 aboard."

bloomberg.com

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To: Jeff Vayda who wrote (3445)10/27/2019 2:49:06 PM
From: Jamie153
   of 3517
 
Have you heard of the CEO Genome Project? It's basically a data trove on CEOs. It even has a test you can take to see where you're at. They tell us stuff like who's getting fired and for what reason. For example, most CEOs are being fired for unethical, immoral and illegal behavior compared to previous years when they were fired for getting shitty numbers.

ceogenome.com

I say this because IMO, what BA did before, during and after the accidents look like amateurs.

Here's my score on their test.


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From: John Koligman10/27/2019 8:43:28 PM
   of 3517
 
Before Deadly Crashes, Boeing Pushed for Law That Undercut Oversight


Months after a second crash of the Boeing Max 737, the plane remains grounded and the company mired in crisis.Credit...Gary He/Reuters

Before Deadly Crashes, Boeing Pushed for Law That Undercut Oversight
The government has been handing over more responsibility to manufacturers for years. The new law makes it even harder for regulators to review Boeing’s work.

Months after a second crash of the Boeing Max 737, the plane remains grounded and the company mired in crisis.Credit...CreditGary He/Reuters

By Natalie Kitroeff and David Gelles

Oct. 27, 2019, 5:00 a.m. ET

With a few short paragraphs tucked into 463 pages of legislation last year, Boeing scored one of its biggest lobbying wins: a law that undercuts the government’s role in approving the design of new airplanes.

For years, the government had been handing over more responsibility to manufacturers as a way to reduce bureaucracy. But those paragraphs cemented the industry’s power, allowing manufacturers to challenge regulators over safety disputes and making it difficult for the government to usurp companies’ authority.

Although the law applies broadly to the industry, Boeing, the nation’s dominant aerospace manufacturer, is the biggest beneficiary. An examination by The New York Times, based on interviews with more than 50 regulators, industry executives, congressional staff members and lobbyists, as well as drafts of the bill and federal documents, found that Boeing and its allies helped craft the legislation to their liking, shaping the language of the law and overcoming criticism from regulators.

In a stark warning as the bill was being written, the Federal Aviation Administration said that it would “not be in the best interest of safety.”

A labor group representing agency inspectors raised concerns that the rules would turn the F.A.A. into a “rubber stamp” that would only be able to intervene after a plane crashed “and people are killed,” according to internal union documents reviewed by The Times.

Weeks after the law was passed, a Boeing 737 Max jet crashed off the coast of Indonesia, killing everyone on board. A second Max crashed in Ethiopia less than five months later, and the plane was grounded.

On both doomed flights, a new automated system on the Max, designed to help avoid stalls, triggered erroneously, sending them into fatal nose-dives. Mired in crisis, Boeing is still trying to fix the plane and get it flying again.

In the aftermath, lawmakers have seized on flaws in a regulatory system that cedes control to industry — an issue that is likely to put Boeing on the defensive this week when the company’s chief executive, Dennis A. Muilenburg, testifies before Congress for the first time since the two crashes.

The F.A.A. never fully analyzed the automated system known as MCAS, while Boeing played down its risks. Late in the plane’s development, Boeing made the system more aggressive, changes that were not submitted in a safety assessment to the agency.

The Max was certified under the old rules. The new law, the F.A.A. Reauthorization Act of 2018, makes it even more difficult for the government to review manufacturers’ work.

Image
President Trump signed the F.A.A. Reauthorization Act of 2018 into law last October. Most of the attention on the legislation had been on a failed Republican effort to privatize the air traffic control system.Credit...Official White House Photo by Joyce N. Boghosia

In the past, agency officials could decide whether to delegate oversight to the company or to maintain control, depending on the importance of a system or concerns about safety. Now, the agency, at the outset of the development process, has to hand over responsibility for certifying almost every aspect of new planes.

If F.A.A. officials decide a system may compromise safety, the new rules dictate that they will need to conduct an investigation or an inspection to make their case before taking back control. If the officials raise concerns, ask for changes or otherwise miss certification deadlines, any disputes are automatically elevated by law to managers at the agency and the company.

The law also creates a committee of mostly aerospace executives to ensure that the regulator is meeting metrics set by the industry, and the law allows companies to make recommendations about the compensation of F.A.A. employees.

“The reauthorization act mandated regulatory capture,” said Doug Anderson, a former attorney in the agency’s office of chief counsel who reviewed the legislation. “It set the F.A.A. up for being totally deferential to the industry.”

A spokesman for Boeing, Gordon Johndroe, said that the certification process is “part of an effective F.A.A. oversight of safety that permits them to focus on the most important issues that are critical to the safety of flight.” He added that “this authority has been a proven way for decades for government regulators across many industries to prioritize resources and rely on technical experts to maintain quality, safety and integrity.”

When the legislation was hashed out, the lobbying effort barely registered in the country’s vast political machine. Boeing’s push, and the use of industry language in the crucial paragraphs, was standard amid the deregulatory drive by many businesses. Most of the attention on the bill was focused on a failed Republican effort to privatize the air traffic control system.

Since the two fatal accidents, the law has set off worries in Washington about whether the rules championed by Boeing make company deadlines a priority over passenger safety.

The manufacturer helped author a report that congressional aides used as a reference while writing the law, borrowing language and ideas that had long been used by Boeing. Its executives pressed Michael Huerta, then the head of the F.A.A., for support, telling him that the regulator’s inefficiency was threatening Boeing’s ability to compete against its chief rival, Airbus of France. They also helped persuade Senator Maria Cantwell, Democrat of Washington State, where Boeing has its manufacturing hub, to introduce language that requires the F.A.A. to relinquish control of many parts of the certification process.

“The method by which the F.A.A. certifies aircraft is in need of repair — I don’t think anyone could argue otherwise at this point,” Representative Rick Larsen, a Democrat from Washington, who voted in favor of the legislation, said in an interview. “No matter what we did last year, we need to be pulling some of that back into the public sphere, and take some of it out of the hands of industry.”

Dennis Muilenburg, Boeing’s chief executive, is testifying before Congress this week.Credit...Johannes Eisele/Agence France-Presse — Getty Images

In closed-door meetings with congressional staff members, in testimony on Capitol Hill, in memos to lawmakers, the talking points were all the same.

Starting in 2014, Boeing and its trade associations explained that streamlining certification would make American aerospace companies more competitive with overseas rivals, by allowing them to develop planes more efficiently.

They argued that F.A.A. employees were interpreting the rules in seemingly arbitrary ways and slowing down the development process, according to seven people involved in the discussions and documents reviewed by The Times.

In a 2015 memo sent to congressional staff members that was reviewed by The Times, the General Aviation Manufacturers Association, which represents the business jet unit of Boeing, urged lawmakers to “fully implement” the so-called system of delegation. If disputes caused delays, the trade group called for “automatic escalation to appropriate F.A.A. and company management” so that issues didn’t languish.

The Aerospace Industries Association, which was headed during part of the lobbying campaign by Mr. Muilenburg of Boeing, echoed those priorities. Richard Efford, a lobbyist for the group, said in an interview that he emphasized the need to “fully utilize” delegation.

Boeing executives made the same pitch to Mr. Huerta at industry events and in meetings at the F.A.A., according to three people with knowledge of the matter. It became a routine discussion, they said.

And they made their case publicly as well, at times citing the company’s safety record.

In a 2015 hearing, Ray Conner, then the head of Boeing’s commercial airplane division, pushed like others for making “full use” of the system. He said it took too long to get approvals for interiors, like seats and bathrooms, that company engineers could assess. He argued that European regulators outsource far more.

The language of their lobbying push was rooted in a 2012 report from an industry-dominated committee run by Christine Thompson, a Boeing executive, and Ali Bahrami, an F.A.A. official at the time who later became a lobbyist.



Ali Bahrami, a Federal Aviation Administration official and former lobbyist, was co-chairman of a committee that in 2012 recommended streamlining certification.Credit...Andrew Harrer/Bloomberg

In aerospace speak, it called for “full utilization of available delegation,” outsourcing as much oversight as possible. It outlined six recommendations that “will result in the reduction of certification delays” and “enhance the global competitiveness of the U.S. aviation industry.”

“There was a consensus that they had good recommendations, and that we ought to put them into writing,” said Matt Bormet, who formerly worked for Mr. Larsen. “I heard no complaints about the report.”

Boeing and its allies found a receptive audience in the head of the House transportation committee, Bill Shuster, a Pennsylvania Republican staunchly in favor of deregulation, and his aide working on the legislation, Holly Woodruff Lyons.

The F.A.A. Reauthorization Act of 2018 was broadly meant to provide agency funding for the coming years. Lawmakers also used it to introduce new rules for drones, airport noise and the certification process.

As Ms. Lyons helped write the law, she was in regular touch with Boeing, according to two people with knowledge of the discussions. The critical paragraphs in the final bill borrowed heavily from industry language, instituting the “full utilization of F.A.A. delegation.”

“The certification reforms in the F.A.A. bill were strongly desired and had bipartisan support,” Mr. Shuster said in an email, noting that delegation “has worked well and safely for over 50 years.”



Then-Representative Bill Shuster, the Pennsylvania Republican who headed the transportation committee, in 2015. He recently said, “The certification reforms in the F.A.A. bill were strongly desired and had bipartisan support.”Credit...Bill Clark/CQ Roll Call

The evolution of the bill had the imprint of industry.

An early version that Ms. Lyons sent to lobbyists directed the F.A.A. to measure its own performance, according to a draft reviewed by The Times. In one circulated a month later, staff members had added a clause specifying that the agency would be judged in part by a committee dominated by aerospace executives, which would come up with metrics for the regulator.

As the Senate prepared its own version in early 2016, Boeing was in close contact with the office of Ms. Cantwell.

“Senator Cantwell is responsive to the needs of Washington State businesses,” said Nick Sutter, one of her former staff members. “Boeing people were in and out of the office all the time.”

In conversations with a top aide for the senator, Matt McCarthy, Boeing lobbyists pushed for language that would compel the F.A.A. to rely more on manufacturers, according to two people directly involved in the discussions. Mr. McCarthy took a job as a lobbyist for Boeing in September.

Regulators and companies agreed that the F.A.A.’s resources were best focused on new and high-risk systems, according to Peggy Gilligan, the agency’s head of safety back then, and several other officials.

As the Senate prepared its own version of the bill in early 2016, Boeing was in close contact with the office of Senator Maria Cantwell, Democrat of Washington State.Credit...Sarah Silbiger/The New York Times

Ms. Cantwell submitted an amendment that directed the F.A.A. to automatically give companies the right to approve anything deemed “low and medium risk” on an airplane. It was language that particularly helped Boeing, with its wide range of planes.

“Listening to your constituents is always the first step in legislating, but it’s certainly not the last,” said Ansley Lacitis, deputy chief of staff for Ms. Cantwell. “This concept of risk-based oversight was bipartisan, consensus-based and recommended by experts.”

The amendment passed without any debate. At the hearing, then-Senator Bill Nelson, a Democrat of Florida, cheered the changes. The law, he said, “will boost U.S. manufacturing and exports and — most importantly — create good jobs for Americans.”

Quieting Criticism



A 737 Max plane at the Boeing factory in Renton, Wash., earlier this year.Credit...Lindsey Wasson/Reuters

F.A.A. officials tried to push back, raising concerns to congressional staff members and aerospace executives. But they were constrained in their efforts.

As a federal agency, the F.A.A. is forbidden by law to use government resources to influence and lobby Congress. At most, officials could provide comments and feedback, so-called technical assistance in the legislative process.

“It is true that we were supportive of delegation as a general philosophy,” said Mr. Huerta, the former F.A.A. chief. “It is not true that means the agency supported every proposal to expand delegation and impose limits on the agency’s ability to take back delegations.”

Early on, Ms. Gilligan, the former F.A.A. official, said industry lobbyists suggested that the law should give companies input on performance evaluations of individual F.A.A. employees overseeing the certification of their planes. Two other agency officials confirmed her account.

“It appeared they were looking to influence the individuals’ pay outcome in some way, and for the F.A.A. employees to know that potential pay impact,” Ms. Gilligan said.

The final bill did not completely satisfy her concerns. The law created a panel with industry representatives to help assess “performance incentive policies” for F.A.A. employees, as long as they “do not conflict with the public interest.”

Peggy Gilligan, then an F.A.A. official, testifying to Congress in 2014. She recently said industry lobbyists suggested that the reauthorization law give companies input on performance evaluations of individual F.A.A. employees.Credit...Win Mcnamee/Getty Images

Mostly, top F.A.A. officials worried about the unintended consequences of giving more authority to manufacturers. Boeing employees have described pressures from their managers to meet deadlines while approving systems.

Under the old rules, the F.A.A. could decide to take back oversight authority on a system if they were concerned about safety. The new law would require the agency to conduct an investigation or inspection to prove that there was a problem before stepping in, a potentially lengthy process.

Industry groups told congressional staff members that manufacturers were sometimes subject to the whims of individual F.A.A. employees, who could block approvals and delay production schedules, according to three people with knowledge of the discussions.

“It causes delays and a lot of frustration within the companies,” said Mr. Efford, the lobbyist.

But regulators were concerned that the new law would keep them from effectively doing their job.

In early 2015, Brian Morris, a safety official at the agency, prepared feedback for lawmakers, arguing that the legislation would prevent the regulator from acting until a dangerous system had already been introduced onto an aircraft. “With this language, Congress is asking us to wait till we find a hazard before removing delegation,” he wrote, according to an F.A.A. document reviewed by The Times.

A current and a former F.A.A. official said that Mr. Morris was collecting feedback from multiple departments, so the comments reflected the opinions of other agency staff members. The document notes that the comments were “provided in response to a congressional request.”

The Professional Aviation Safety Specialists union, a small labor group that represents F.A.A. employees, had a similar warning. If the regulator could only intercede after documenting problems, it may not be able to stop manufacturers from installing risky systems.

“That will, as a practical matter, mean after the accident has happened and people are killed,” the union said in comments prepared for Congress in early 2016, which were reviewed by The Times.

Through a spokesman, Ms. Lyons, the congressional aide writing the law, said she did not receive comments from Mr. Morris or the union, but was aware of the F.A.A.’s worries.

“The concerns were discussed and considered in a bipartisan manner,” said the House transportation committee spokesman, Justin Harclerode. “Members did not agree with this interpretation of the language, and were not convinced the language would negatively impact the FAA’s ability to safely oversee the aviation industry”

He added that the F.A.A., under the law, could set the parameters of the investigation or inspection.

Lawmaker’s Remorse



Demonstrators hold pictures of victims of the crash of the Boeing 737 Max in Ethiopia at a vigil last month outside the Department of Transportation in Washington.Credit...Jose Luis Magana/Associated Press

At a ceremony in the Oval Office last October, President Trump signed the F.A.A. Reauthorization Act into law, while Representative Shuster, who shepherded the legislation, looked over his shoulder.

The agency has already begun to make the required changes.

In August, it announced the formation of the advisory committee charged with setting goals for the regulator. The committee includes two union representatives and 17 industry officials, among them Beth Pasztor, one of Boeing’s top executives. The F.A.A. recently selected managers for an internal office that will help enforce provisions of the law.

As the rules take hold, some lawmakers who originally supported the legislation are backing away.

Mr. Nelson, the former senator who co-sponsored the law, said he did not fully understand the ramifications. “This was never brought to my attention,” he said in an interview. “Had I known about it, I would have tried to put the kibosh on it.”

Representative Peter DeFazio, the Oregon Democrat who is the chairman of the House transportation committee, celebrated the bill’s changes last year, saying it would maintain safety and “will help our manufacturers become much more competitive in the world market and introduce their products more quickly.”

Mr. DeFazio, who is currently leading a congressional investigation into the crashes, said in an interview that he was reconsidering the law and might introduce legislation to restore some of the agency’s oversight authority.

“If the F.A.A. basically deferred on a safety critical system and did not provide proper oversight, then either the individuals involved are going to be at risk, or the whole system itself isn’t working properly,” he said.

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To: John Koligman who wrote (3447)10/27/2019 9:24:12 PM
From: SI Ron (Crazy Soup Man)
   of 3517
 
Boeing seems to have problems with a lot of their aircraft. I have been following the 737 story, as I tweet about them every day on our twitter page. Boeing seems to have problems with fatal crashes....

Remember this:

en.wikipedia.org

The V-22 Osprey had 12 hull loss accidents that resulted in a total of 42 fatalities. During testing from 1991 to 2006 there were four crashes resulting in 30 fatalities.

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From: John Koligman10/29/2019 12:30:29 PM
   of 3517
 
The statement I excerpted from the article makes me wonder why the CEO still has his job... My understanding of all this is that any subsystem that has the capability to take down an airplane is supposed to have backup redundancy, whereas MCAS could run with a single sensor.... AND, they didn't test this???

"Hamilton said Boeing didn’t “specifically” test an unintended activation of the system because of an issue with an angle-of-attack sensor."

In fiery Senate hearing, Boeing tells lawmakers that its safety assessments of 737 Max fell short
PUBLISHED 39 MIN AGOUPDATED 9 MIN AGO

Leslie Josephs @LESLIEJOSEPHS

In a tense hearing, Senators are grilling Boeing’s CEO about the 737 Max after two crashes.The planes remain grounded as Boeing works on a software fix.Boeing’s chief engineer says in hindsight the assumptions were wrong.



Dennis Muilenburg, chief executive officer of Boeing Co., speaks during a Senate Commerce, Science and Transportation Committee hearing in Washington, D.C., U.S., on Tuesday, Oct. 29, 2019.
Andrew Harrer | Bloomberg | Getty Images

Boeing executives told lawmakers on Tuesday that they made mistakes developing the 737 Max plane, grounded worldwide after two crashes killed 346 people.

In a fiery hearing on Capitol Hill, Sen. Maria Cantwell, a Democrat from Washington, the state where the 737 Max is made, asked Boeing’s CEO Dennis Muilenburg and the commercial airplane unit’s chief engineer whether its safety assumptions and assessments were wrong.

“In hindsight, yes,” said chief engineer John Hamilton in a Senate Commerce Committee hearing. It is the first time Boeing executives are testifying before lawmakers on Capitol Hill.

At issue is a flight-control system known as MCAS that malfunctioned on both flights because it received erroneous data from a faulty sensor. The sensor measures the angle of attack, or the angle of the plane relative to oncoming air. If the nose is pointed too high, the plane could stall, so the system automatically pushes the nose of the planes down.

In the case of both crashes — Lion Air Flight 610 that went down in the Java Sea exactly one year ago today, and an Ethiopian Airlines crash in March — pilots battled the system that repeatedly pushed the nose of the planes down.

The FAA, last week, shut down the Florida maintenance facility that worked on one of the Lion Air sensors.

Boeing has been highly criticized for its assumptions about the plane, including overestimating average pilots’ ability to safely fly planes amid a flurry of cockpit alerts, which occurred on the Lion Air jet.

“We relied on these longstanding industry standards of pilot response,” said Muilenburg, adding that was an area where “we found shortfall.”

Boeing shares were little changed in early afternoon trading.

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To: SI Ron (Crazy Soup Man) who wrote (3438)11/1/2019 12:06:09 PM
From: Eric
   of 3517
 
Well the problem with the sims is that the software to drive them were not finished and certified way back in 2016.

The software and firmware in the Max is completely different than what is in the sims.

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To: Jeff Vayda who wrote (3445)11/1/2019 12:12:12 PM
From: Eric
   of 3517
 
Yup,

That pilot in the jump seat knew exactly what to do.

Turn off two switches on the rear of the center throttle quadrant that controls power going to the Stabilizer jack screw.

The plane can be controlled in pitch perfectly manually.

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From: John Koligman11/8/2019 9:20:54 PM
   of 3517
 
When will Southwest announce they are changing their 'bet the company on one plane model' strategy and give Airbus some orders???

Southwest, American extend Boeing 737 Max cancellations until early March
PUBLISHED FRI, NOV 8 20193:30 PM ESTUPDATED 3 HOURS AGO
Ganesh Setty
KEY POINTS
Southwest Airlines will remove all Boeing 737 Max planes from its flight schedule through March 6, while American Airlines will extend its cancellation through March 4.
Southwest had previously grounded the plane through Feb. 8, while American Airlines cut the 737 Max from its flight schedule through Jan. 16.
Southwest is the largest customer of the planes in the U.S. and had 34 in its fleet with 200 more on order at the time of the 737 Max grounding in March.
RT: Southwest Boeing 737 Max jets grounded 190327
A number of grounded Southwest Airlines Boeing 737 MAX 8 aircraft are shown parked at Victorville Airport in Victorville, California, March 26, 2019.
Mike Blake | Reuters
Southwest Airlines will remove all Boeing 737 Max planes from its flight schedule through March 6, delaying the plane’s return longer than any other U.S. carrier, the airline announced Friday. Separately, American Airlines also announced after the bell Friday that it will continue its 737 Max cancellation through March 4, resuming commercial service on March 5.

Southwest had previously grounded the plane through Feb. 8, while American Airlines cut the 737 Max from its flight schedule through Jan. 15.

The decision comes as the Southwest Airlines flight attendants union weighs suing Boeing over lost pay as a result of the prolonged 737 Max grounding. The airline’s pilots sued Boeing last month over what it said was more than $100 million in lost wages due to the grounding.

Southwest Airlines’ fleet is entirely made up of Boeing 737s, and it has had to cancel thousands of flights as a result of the grounding. It is the largest customer of the planes in the U.S. and had 34 in its fleet with 200 more on order at the time of the grounding in March. Southwest’s shares are up approximately 25% year to date.

Boeing came under further pressure in late October after documents surfaced detailing that engineers raised concerns about the 737 Max’s faulty MCAS flight-control system before two crashes that killed 346 people.

Southwest said it is unable to provide updated first-quarter guidance for 2020 due to the cancellation extension. Southwest’s shares were little changed following the decision, while Boeing’s shares dipped by about 1% in midday trading.

American also had its own share of 737 Max related cancellations and labor disputes this past summer, cancelling more flights than any other carrier in July. American’s shares are down approximately 4% year to date.

American said that any customer who previously booked a flight on a 737 Max through March 4 will have their reservation updated. Once the 737 Max is certified, American expects to run exhibition flights, or flights for American team members and invited guests only, prior to March 5.

The company’s shares dropped less than 1% off its closing price of $30.76 per share during extended trading. Southwest’s shares, meanwhile, remained unchanged from its closing price of $58.18.

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From: SI Ron (Crazy Soup Man)12/9/2019 1:46:20 PM
   of 3517
 
After 30 days no messages boards are removed from the stock pages, so here is one to keep this going for another month.


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From: John Koligman12/16/2019 6:57:03 PM
   of 3517
 
Looks like BA finally got the message that they are no longer in control in terms of when the plane flies, and that the FAA is going to take more time due to the publicity these crashes generated, and how the new system was certified. It's astounding that BA has built 400 of these since the grounding and they are sitting around burning cash for the company. The cash drain must be something to behold. Shareholders better hope more bugs are not found, as the longer this goes on the more precarious BA's financial position becomes.

Boeing will suspend 737 Max production in January
PUBLISHED MON, DEC 16 20194:35 PM ESTUPDATED 10 MIN AGO

Leslie Josephs @LESLIEJOSEPHS
Phil LeBeau @LEBEAUCARNEWS

Boeing is planning to suspend production of the 737 Max after regulators said they don’t plan to lift a flight ban this year.The planes have been grounded since mid-March after two fatal crashes.The company isn’t planning to lay off or furlough employees at its plant in Renton, Washington.



WATCH NOW

VIDEO01:53
Boeing to suspend 737 Max production: Sources

Boeing is planning to suspend production of its beleaguered 737 Max planes next month, the company said Monday, a drastic step after the Federal Aviation Administration said its review of the planes would continue into next year.

Boeing’s decision, made after months of a cash-draining global grounding of its best-selling aircraft, worsens one of the most severe crises in the history of the century-old manufacturer.

The measure is set to ripple through the aerospace giant’s supply chain and broader economy. It also presents further problems for airlines, which have lost hundreds of millions of dollars and canceled thousands of flights without the fuel-efficient planes in their fleets.

Boeing said it does not plan to lay off or furlough workers at the Renton, Washington, factory where the 737 Max is produced during the production pause. Some of the 12,000 workers there will be temporarily reassigned.

Boeing last week acknowledged that regulators’ review of the planes — grounded since March after two crashes killed 346 people — would last until the following year, longer than the end-of-year approval the Chicago-based manufacturer was targeting.

Just how long Boeing will keep its 737 Max production line halted was not immediately clear, because it will depend on when regulators clear the plane to fly again. U.S. airlines have taken the planes out of their schedules until at least March. American last week said it doesn’t expect to fly the planes before April.

“We know that the process of approving the 737 Max’s return to service, and of determining appropriate training requirements, must be extraordinarily thorough and robust, to ensure that our regulators, customers, and the flying public have confidence in the 737 Max updates,” Boeing said in a statement. “The FAA and global regulatory authorities determine the timeline for certification and return to service. We remain fully committed to supporting this process. It is our duty to ensure that every requirement is fulfilled, and every question from our regulators answered.”

Boeing had repeatedly warned investors that it could further cut or suspend production of the planes altogether if the flight ban lasts longer than expected, as it has. Boeing slashed production by 20% in April to 42 a month after regulators ordered airlines to stop flying the planes.



WATCH NOW

VIDEO16:19
Boeing to halt 737 production in January 2020, won’t furlough workers

Close to 400 Max planes were in global fleets when regulators grounded the planes in mid-March after two fatal crashes in a span of five months. Since then, Boeing has produced some 400 more of the jetliners, which are parked at its facilities in Washington state and elsewhere. The grounding, now in its 10th month, has prevented Boeing from delivering planes to customers, and the company said halting production would help it deliver the stored planes when the grounding is lifted.

Boeing shares, which fell more than 4% during the regular session, were down 1% in after-hours trading. Also on Monday, it declared a quarterly dividend, holding it steady at $2.055 a share.

Spirit AeroSystems, which makes fuselages for the 737 Max, was down more than 4% postmarket.

Smaller suppliers with smaller cash cushions are particularly vulnerable to the production pause, analysts said.

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