Saga: Fixin’ to Fly Right?📌📌📌‼️
Something of a compendiary ‘sequence of descents’: The planemaker’s reparatory saga begins…
Having already owned up to “failing and falling short” throughout this process, Boeing’s time has come to face the test and ace it with flying colors.
So says CEO Dennis A. Muilenburg, who has announced that his aerospace giant is ready to release its software ‘fix’ for the the 737 MAX 8/MCAS mess. Among its bullet points are: two Angle-of-Attack (AofA) sensors instead of one; nose-down action that activates less often and forcefully. MCAS 12.1 is designed to shut down if the two sensors vary by 5.5 degrees or more, with the automated system firing only once, rather than repeatedly as in previous version 11.1.
This, after 360+ hours of airborne tests over the course of 207 flights—capping a once projected six-week remedial process that has taken more than 14. The ‘patch package’ includes extensive, though reportedly incomplete simulator dry runs (e.g., machines lack drill for fighting manual stabilizer wheel physical resistance), as well as clearly bolstered training manuals and other supporting materials.
“We have completed all of the engineering test flights for the software update,” Muilenburg explained, “and are preparing for the final certification.” He added that Boeing is committed to providing the FAA and aviation regulators worldwide all necessary information to gain global support and “get this right.”
Testing Up and Out.
Now comes the flight-control system upgrade’s next crucial test. Boeing intends to submit full ‘fix’ data and documentation to the FAA in a week’s time—to an agency that has pledged (not least under Congressional pressure due to’ inadequate oversight’ heretofore) to employ “every tool, every data-gathering capability at our disposal to clear the aircraft for return to flight—(but only) after we’re satisfied that the safety concerns have been addressed.” Meantime, the Justice Department continues to investigate whether Boeing has been misleading regulators since the 737 MAX’s initial certification push.
That documentation must also elaborate on how the test pilots worked with the updated automated system—specifically how they interact with controls (e.g., Stabilizer ‘Stab’ Trim Cutouts during runaway trim) and display screens under differing conditions and circumstances. Only then will FAA and other regulators schedule test flights toward final certification and now grounded 737 MAX 8’s returning to the commercial skies—possibly months away.
These steps will comprise a rigorous re-approval analysis made no easier by Boeing’s resistance, denials, obfuscation and blame-passing since the Lion Air disaster. Seems nobody has trusted anybody in this world during the entire MCAS impasse, and max anal-retentive ass covering is likely to be the standard throughout the MAX’s recertification process moving forward.
Test Upon Test.
Then there is the ultimate test: in the marketplace, wherein we travelers will actually choose to board the suspect 737-8s once again, entrusting a bruised and black-eyed Boeing with our very lives. Or not: for no glossy PR offensive nor pilot cheerleading will easily move that trusty needle. Indeed, a recent Barclays PLC survey found that nearly 50% of traveler respondents would opt for another plane model or wait at least a year before boarding a MAX. Although some industry analysts maintain that traveler memories are short and aircraft alternatives are limited. So real time will tell…
Until then, Vamigré will be all over this next grilling, grueling chapter in the long-haul MAX/MCAS saga. It will begin with a May 23 FAA ‘safety summit’ meeting of international regulators, air carriers (and pilots’ unions) to review the plane maker’s case for recertification, assess its efforts to make the MAX-8 “one of the safest airplanes ever to fly.”
Suddenly Sidetracked.
But further complicating Boeing’s MAX comeback campaign is the FAA revelation that wing slats on 179 737 MAX and 133 earlier NG (Next Gen) aircraft are substandard, if not outright defective.
Installed in fleets worldwide, these suspect ‘leading edge slat tracks’ are susceptible to premature cracking—not necessarily posing an imminent accident hazard, yet potentially causing aircraft damage in flight.
‘Slat tracks’ are movable panels built in along the front of 737 wings that expand during takeoffs and landings for additional lift. The tracks essentially guide movement of the wings’ flight control panels, but inferiorly manufactured parts can weaken and fail before time.
Boeing has had no comment on the air-safety regulators’ finding, although notes that no in-service issues have surfaced related to the slat track batch in question. However the plane maker intends to inspect the parts in coming days.
Meanwhile the FAA’s latest directive orders resolution of the allegedly faulty slat track situation within 10 days. Just one more deadline and pressure point for the beleaguered aerospace giant…
Update: Summer Onset, 2019.
As travelers navigate the usual summer rush (particularly to Europe, if not China), we face herring packed airline cabins and chaotic scheduling, some 400 MAX jets still bound to the ground.
FAA flight trials are set the begin for the MCAS-beleaguered 737s, with the focus on safety over timetables, yet pressure from anxious carriers and Boeing—despite the plane makers’ PR assurances of a safe, sure, above and beyond ‘software fix’. Complicating this scenario is the FAA’s latest discovery amid its flight simulator testing that yet another MCAS glitch may impede pilots’ ability to regain control of a MAX once the anti-stall system malfunction has kicked in. Whether another software bug or microprocessor chip failure under extreme situations and conditions, this new flaw poses “a potential (mid-flight) risk that Boeing must mitigate”, according to regulators, that could now push real-time MAX testing and recertification deeper into October and beyond—primarily out of abundant rigor and caution by the newly pressurized FAA.
Among the issues continuing to weigh on the crucial MAX recertification process include the fail-safe reliability of MCAS flight control system, and the ability of pilots to manually crank cockpit wheels to adjust horizontal stabilizer wheels in severe emergencies (on earlier 737 variants, too). Namely, are they buff enough to physically rotate the console wheels and change a plane’s nose angle (under massive pressure) when MCAS and all else fail?
Moreover, Congressional hearings have just crystallized the industry-wide debate over post-MCAS pilot instruction. Under their revised software and training guidelines, Boeing and FAA appear to remain steady as they go that two-hour iPad tutorials will adequately bring flight crews up to speed on the re-tooled anti-stall technology’s procedures and handling.
The planemaker maintained that it conducted thorough Functional Hazard Assessments on its simulators early on (although not simulating MCAS failure/crash scenarios nor running any ‘real time’ inflight training sessions addressing such disasters). Boeing further contends that MCAS met all certification/regulatory specifications, that the system wasn’t “new or novel” requiring special scrutiny, and that there was “no process violation or non-compliance” in the 737 MAX’s initial certification. In other words, just jigger the horizontal stabilizer a little, that’s all—no fault here…
Still, other House Committee on Transportation and Infrastructure’s aviation subcommittee witnesses warned that even implementing mandatory, thorough simulator retraining alone will only sully MAXimum safety preparation. So testified former pilot and Hudson River landing hero, Chesley B. Sullenberger III, charging that “our current system of aircraft design and certification has failed us”, and “it is clear that the original version of MCAS was fatally flawed and should never been approved.” In other words, ‘Sully’ implied, don’t go laying blame on flight crews, domestic or foreign, particularly since they weren’t adequately informed nor trained on MCAS in the first place.
Boeing representatives did not attend the hearing, but CEO Muilenburg did promise a comprehensive ‘end to end’ review of its design and certification processes. Then there is the hurdle of gaining international sign-off on the recertification (particularly by Canadian and European regulators) before MAXs can once again take to the skies (by late summer, at best—and worst case, on into the holiday travel season).
As a result of this prolonged grounding, several airlines have cancelled many more flights amid the peak season summer travel rush due to capacity constraints—for which Boeing will be paying dearly in compensation going forward. American Airlines for one expects to take a Q2 $185m profit hit from the idling of 24 737 MAX 8s; UAL foresees no MAX reutilization until November at least, cancelling 5,000 more flights; Ryanair shelves growth plans, to cut flights and staff through next summer). Moreover, it is costing Boeing future MAX business, as Saudi budget carrier, Flyadeal has moved its 30 plane order over to Airbus, citing its current “schedule requirements”.
But perhaps most importantly, the flying public has to buy in. And if recent polling is any weather vane, at least half of U.S. fliers are still not sure they will board re-MAXed 737s, or will surely avoid doing so altogether. Rising above a global ‘crisis of trust’: therein lies the plane maker’s truest test and challenge.
Springtime in Paris…
Otherwise, adding to Boeing’s current woes is the orderbook tally at the recent 2019 Paris Air Show.
Although the U.S. aerospace giant did land some $24b in new orders for its 737 MAX 8/9 despite the two tragic crashes and resulting negative media scrutiny, Airbus SE gained significant altitude and ground. Overall, Airbus booked $43b in advance orders, Boeing $36b—both down from previous Paris Show highs, likely due to worldwide trade tensions and fluctuating fuel outlays.
Of particular concern to the Chicago/Seattle-based plane maker was Airbus’s springing its newest offering on the biennial gathering. With the introduction of its A321LR, Airbus upgrades its A321neo and hopes to supplant Boeing’s aging 757 and wider body 767, as well as the 737-200. This midsize single-aisle jetliner has been the buzz of the Paris show, seating 250+/- passengers, offering short haul/long haul flexibility and 30% more efficiency than today’s 757s (and alas, slimmer, tighter seating).
The A321LR will enable an array of airlines (notably budget carriers) to increase trans-Atlantic routes directly, point to point, from smaller cities (e.g., in America’s heartland) mainly by adding 800 miles worth of fuel capacity and range (over 4,700 nautical miles).
So Airbus inked 206 orders for its latest model, with customers such as American Airlines, Jet Blue, British Air, among others. Qantas/Jetstar alone signed on for 36 XLRs; IndiGo Partners Corporation will purchase them for its low-cost carriers Wizz, JetSmart and Frontier; Air Lease Corp. ordered 27. The latest order from IndiGo calls for 300 planes (mix of A320neos and XLRs) totaling $33b.
Airbus projects selling hundreds of the new model, launching by 2023, while it posts soaring quarterly profits overall. The only speed bumps to its eclipsing Boeing as the world’s leading plane manufacturer appear to be capacity/ production limitations and meeting an already existing backlog of over 7,000 orders.
…Autumn in Abu Dhabi and Dubai.
The European planemaker continued its roll in Dubai’s Air Show this fall, garnering at least $30b in new plane orders—namely 50 wide-body A350s from Emirates Airline, some 120 Airbus aircraft (a mix of A320s and A321s) to Air Arabia.
Meanwhile, Boeing tried to sell its safety commitment, desperate to keep customers from jettisoning its brand. Yet it appears some carriers are still willing to buy in, despite the protracted grounding. Kazakhstan’s Air Astana has signed on for 30 narrow-body 737 MAXs ($3.6b, with discounts), adding to its A320neo fleet. SunExpress Airlines in Turkey (owned partially by Lufthansa) ordered 10 737-8 MAXs, subject to the model’s “undisputed airworthiness”. Add to that other, unnamed bookings, grand totaling 60 MAX jets. Boeing may even have salvaged a 2017 $15b order for 40 787 Dreamliners from Emirates Airlines.
Which nevertheless leaves the Chicago-based company in the contrails, with nascent plans for a 757/767 replacement labeled NMA, somewhere between a stretch 737 and smaller 787 Dreamliner, but nothing yet beyond the drawing board (optimistically targeting for 2025). Yet already preoccupied with the MAX imbroglio, Boeing now faces delays in its 777X long-haul jet, due to performance/safety problems with its GE engines—plus serious fuselage rupture/failure and passenger door blowout under ‘extreme compression load’ stress test conditions.
In all, high time for Boeing to clutch their new MAX orders, then hit the skies again at full trim and throttle with the “safest airplanes ever to fly”—that is, instead of just half-ass chasing another Airbus tail. For as its MAX orders and deliveries decline, most recently by one-third, rival Airbus A320neo production and shipments surge to record levels (over 500 orders per year since 2016).
Therefore Boeing not only suffers a $50b drain of market value since its March ’19 highs, but surrenders the ‘first chair’ in global aircraft production after a seven-year run. Indeed, Airbus expects to deliver nearly 900 planes this year; Boeing, though planning to ship over 900 airliners in 2019, has since shelved any such rosy projections.
Rather, the plane maker has cut 737 MAX output by 20%; now parks some 150 undelivered MAX jets ($30b worth) around the U.S. (as at Moses Lake, WA)—no new orders for three months, some customers changing, if not outright cancelling their MAX bookings—as the grounding of airlines’ existing MAX fleets grinds into a fourth month. With no resolution in sight, Boeing also faces many more months of 737-8 recertification and re-activation as the global jet buying spree shows signs of cooling down.
Little wonder the company is now rejoicing over a most recent ‘mayday’ order for 200 new MAX jets from International Consolidated Airlines Group SA, parent of British Airways. Then there are the aerospace giants’ recent tit-for-tat tariff spat, which can’t be good news for either Airbus or Boeing in their dogfight for market dominance.
So please remain seated through this unclear air turbulence, belts securely fastened, setbacks and trays fully raised. (MTC…)
<< 737 MAX: The Fix Is In? 📌
Further U/Date: Preventable Disasters?
Five months into the 737 MAX grounding, Boeing faces increasing public criticism. To such industry and/or governmental stalwarts as former NTSB Chairman, Jim Hall and managing director, Peter Goelz, the rap is the planemaker’s handling (and muddled mishandling) of the whole MAX/MCAS affair.
Throttled or Coddled?
Beyond that critique, the entire relationship between Boeing and the FAA is under increasing scrutiny. That is, how much control over the MAX inspection regimen has been handed over by federal regulators to the manufacturer’s managers and engineers. By their own admission, former FAA engineers reveal that the agency has never fully understood the MCAS automated system, that they were never able to critically evaluate the risks of such an anti-stall program when they first certified the 737 MAX in 2017.
It would appear that as commercial planes become more technologically sophisticated, a chronically understaffed, resource strapped FAA adheres to rules that perhaps no longer adequately address air safety. Thus the agency has left more and more oversight to Boeing’s in-house engineers—who have been making decisions largely pegged to the plane maker’s budgets and timelines —to where they never even bothered to send FAA regulators the required MCAS review. ☟
Handshakes or Arm Twisting?
Case in point: FAA engineers expressed concerns early on as to the size and might of new 737 GE Safran engines. If, for instance, one of the supersized LEAP power plants exploded in midair, sending shrapnel into the aircraft’s wings and/or fuselage? Specifically, should metal fragments sever two crucial rudder cables running back to the tail section, pilots could instantly lose control of the plane.
Low risk, Boeing engineers replied—‘not bloody likely’. Meanwhile its managers pushed back against alternative cable designs, citing the 737’s long safety record. The agency blinked and gave Boeing the right to final approve the MAX cables. As Boeing raced to rush its MAX through certification, the FAA bulletins neglected to even mention MCAS in detailing changes between the MAX variant and previous 737 iterations.
Moreover, it appears regulators were aware of the MCAS safety threat shortly after the Lion Air JT 610 crash, well ahead of the Ethiopian Airlines disaster. In fact, the FAA’s TARAM (Transport Airplane Risk Assessment Methodology) spreadsheet formulas determined that a mere ‘heads up’ bulletin on the MCAS sensor malfunction to flight crews ‘would suffice’, giving Boeing some 10 months to design and deploy system changes. But Ethiopian Air’s ET 302 wouldn’t wait.
Uncommon Carriers.
Same time, carriers affected by the grounding of their existing 737 MAXs, plus overdue deliveries, stalled future orders, and financing outlays on planes not earning their keep, are presenting ‘make good’ bills to “those who produced this aircraft.” Further, Boeing’s MCAS ‘software fix’ and ancillary setback patches face an FAA recertification process under Congressional fire, and the agency is already tightening inspection screws—vowing to lift the prohibition order only when it’s deemed safe to do so by regulators the world over. Problem being that satisfying the patchwork of those global regulators will constitute a country by country whack-a-mole process which could prolong uniform worldwide recertification even further.
So it comes as little surprise that the aerospace giant recently posted a $7.3b hit to its bottom line—which doesn’t even account for the massive litigation and compensation costs it bears with respect to Lion Air and Ethiopian Airline passengers’ survivor/families. This, while bread-and-butter 737 workhorse production slows and orders further decline (a 35% drop in quarterly sales to $15.8b; 42 planes per month from 52)—to where Boeing may stop producing MAXs altogether if recertification stalls beyond year’s end. Further clouding the planemaker’s skies are reports of newfound stress cracks around ‘pickle fork’ wing connection areas in heavily used 737NGs, 700 thru 900 iterations.
Along those lines, the FAA has since issued a directive for the re-inspection of 737NG through -900 variants that have logged over 30,000 flight cycles. At issue are those primary load-bearing ‘pickle forks’—some two to eight fasteners that secure wing spans to fuselages—after some 5% of inspected planes have exhibited such stress cracking. Boeing has assured it will undertake the costly ‘fork’ replacement, which involves removing adjacent aircraft interiors, and may ground affected 737s through mid-December.
This, after federal officials recommended the redesign of 737NG engine cowlings, so as to more safely contain flying fan blades and metal shrapnel from exploding engines (in light of fatal SWA incidents noted in Incidents & Accidents). The retrofit will affect some 6,800 aircraft worldwide.
Nevertheless, Boeing stock has downdrafted only modestly at the news, Wall Street apparently concluding that the worst of the company’s bad news was already baked into the share price. That analysis emerges at a moment investors actually are broadly bearish on airline stocks, despite the fact that U.S. carriers such as United and Delta are reporting nearly historic revenue and profits for 2019 thus far.
☟To somewhat remedy that supervisory shortfall, Boeing has now announced that, here forward, its engineers will report to the Chief Engineer rather than project managers, to better ride herd over potential design/production problems. At the same time, the planemaker says it will redesign its cockpits to make them more ‘failsafe and user friendly’ to accommodate pilots worldwide who may have less flight training and experience.
FAAvoritism On a Global Scale.
As for the FAA, that agency now faces pressure to right its airship by the Joint Authorities Technical Review. JATR is the very international panel the FAA itself created this past April—outside review as a means of fostering an international consensus on 737MAX recertification. It is led by Christopher Hart, former chairman of the NTSB.
The multiagency task force, including aviation authorities from Europe, Asia, the Mideast and Americas, will conclude in its upcoming findings that the FAA lacked rigor and transparency in its oversight of the entire 737 MAX/MCAS certification saga.
Although this advisory panel’s review and recommendations are not binding on the FAA, JATR does not directly address MCAS and other MAX’s onboard flight control modifications, its bullet points could significantly influence Boeing’s ‘fixes’ and speed bump the road to MAX recertification. Not to mention the FAA’s authority, independence and nose-to-tail supervisory role in the process, as the questions remain: What did Boeing and the agency know about MAX/MCAS glitches early on and precisely when did they know it? Moreover, was the planemaker misleading the FAA regarding its 2016 flight test simulators’ red flag warnings?
Ostensibly the agency and Boeing have welcomed JATR scrutiny as they seek to rebuild official and public confidence in the still-grounded aircraft. Nevertheless, EU, U.A.E. and Asian/Indian authorities have made clear that their approval of MAX remedial and retraining measures may not issue forth until well beyond November. JATR has since iced recertifications hopes even further, the joint international body having issued a scathing report that strafes both the plane maker for “undue pressures” on ‘time is money’ production of its 737 MAX iteration, as well as the FAA’s “limited involvement (in)” and “inadequate awareness” or oversight of MCAS development.
It’s gotten to where European and Middle East regulators have since announced that they will conduct their own MAX recertification processes, independent of the FAA, before allowing the grounded 737s back in their skies— along with Euro “concurrent validation” of new 777Xs—somewhat usurping the U.S. agency’s leading global oversight role.
Now, whether Boeing and the FAA actually follow the JATR flight path or continue to stink up the joint remains to be VamoSeen… For starters, the company has stripped Muilenburg of his chairmanship, though he’ll remain as CEO.
MAX Fix Today: Speeding Up, Slowing Down.
This comes after the ‘October surprise’ discovery that Boeing managers rejected a new air data indicator, early in 737 MAX/MCAS development, that could possibly have helped prevent the fatal LionAir and Ethiopian Airliner crashes. The system is called Synthetic Airspeed (SA), which measures a plane’s speed relative to air, not ground speed, factoring in wind direction as well. SA draws its data angle-of-attack vanes, rather than pitot-static pressure sensors, to more precisely inform an aircraft’s flight operating system, its independent comparators cross-checking and detecting any erroneous AofA data.
To date, Boeing has only installed SA technology in its top-of-line 787 Dreamliner models. Still, its engineers determined that the 737 MAX has the added computational power to process SA’s vital readings, and pushed hard to have Synthetic Airspeed incorporated into the MAX/MCAS operating technology for added safety.
But managers decided the SA upgrade would prove too costly, and require more burdensome pilot training—that if it wasn’t compulsory for initial FAA certification, it was unnecessary (overkill?) at the time.
With regard to MAX/MCAS computational power, Boeing fix/recertification efforts face a new downdraft. The European Union Aviation Safety Agency is dissatisfied with the planemaker’s new dual flight control computer configuration, a tandem processing redundancy that is designed to spot and correct for chip breakdowns. EASA questions whether the simultaneous computers and software will reliably work together. Thus it will conduct its own independent safety assessment and simulator testing.
Upshot? The European agency’s second guessing of a preliminarily favorable U.S. risk analysis on safety grounds is a groundbreaking test of the FAA’s global credibility and leadership—and threatens to tack months onto Boeing’s plans to roll out 737 MAX recertification, region by region come November—let alone full recertification worldwide. Meanwhile CEO Muilenburg states that Boeing has already logged 700 MAX test flights, but has yet to submit final software fixes for FAA approval well into October.
The federal agency has yet to have advanced the ungrounding process beyond ‘methodical’ safety reviews, with no final revision/recertification timeline in sight. That scheduling is crucial to Boeing, as its sales and deliveries drop (wide body models included), liabilities rise—as with the lawsuits by victims’ survivors to delay recertification on safety grounds. Key decisions must be made as to whether the Chicago-based company should further cut 737 production or shut down its Renton plant entirely, what with MAX jets stacking up in storage, pushing the global MAX fleet to above 1,000 by year’s end.
Nevertheless, the FAA has most recently declared that it will conduct all thorough safety checks and final sign-offs independent of Boeing inspectors, one 737 MAX aircraft at a time, no matter how long it takes to complete the grounded planes’ airworthiness recertification.
Bused In, MAXED out.
Between now and then, airlines, pilots and other unions seek millions of dollars of compensation in the courts. Air carriers are paying millions to cover the logistics and maintenance of their grounded planes—wrestling with squeezed capacity and cancelled flights versus daily costs of idle crew pay, passenger reimbursement and the financing of undelivered or replacement aircraft. American Airlines alone (with 24 737s grounded) has scratched nearly 9,500 flights this year thus far, foreseeing a January recertification, management heads already rolling; Ryanair is already pencilling out its MAX planes from 2020 summer service.
But while American suffers a 16% stock price drop in 2019, due in part to labor problems and the MAX mess, rival Delta is not exactly singing the blues. Rather, the Atlanta-based carrier has toppled American as the airline market/traffic leader worldwide. Fleetingly MAX-free, it has bolstered its already robust passenger loads with bleed over from carriers brought low by the 737 grounding-forced delays and cancellations. Delta has posted a 13% updraft in 2019 quarterly earnings (up 29% over 3Q 2018 alone), with an over 5% jump in revenue, shares up nearly 8%. Steering toward its 10th straight year of profitability, the carrier has signed on to $14b in orders for new Airbus A350s and A330neos. The high-flying airline’s only dark clouds seem to center on pilot and staff shortages heading into the holiday season and another banner new year.
As for United, the #2 U.S. carrier posts a $1b Q3 profit, up from $833m in 2018—UAL’s shares are up 2%, despite have its 14 737 MAXs grounded, with 16 more on order this year.
Meanwhile, American and other grounding-crippled carriers con only hope for clearer skies if and when 737 MAX aircraft freed from ‘preservation maintenance’ and are certified to fly once more…
Passengers Spurned and Spurred.
As for us travelers, over 3 million passengers have been disrupted since the grounding began. We are being turned away from overbooked flights, stalled by trimmed schedules and sudden cancellations owing to the airlines’ capacity crunch—along with ballooning fares if lucky enough to board at all—figuring it’s about payback time.
Fiscal Graffiti: October, 2019.
Little wonder it is estimated that Boeing has set aside a make-good kitty of over $5.5b to address all this: Looks like it may merely be priming the compensation pump.
Diving deeper: at a time when authorities and critics are flagging the planemaker for its alleged cost-cutting and production/safety deficiencies, Boeing releases a muilenburger of 2019 third-quarter results. Even while the company continues to roll 42 737 MAXs per month out of its Renton, WA plant into various parking/ storage locations—350 undelivered models piling up, from Washington state to Texas.
Overall sales down 21% from 2018, Boeing’s Q3 revenue comes in at 30% below market analysts’ estimates. Profits plunged more than 50%, as quality control issues plaguing the 787 Dreamliner and development delays on the new 777X also drag on the bottom line. The aerospace giant burned through $2.4b, $2.9b negative cash flow in the quarter alone, total debt rising by $5.5b (70% over Q1)—to where it had to borrow $10.9b for adequate liquidity.
Not surprisingly, Boeing’s shares fell some 12% in Q3, ‘buy’ recommendations tailing off to 48%. Still, the company continues to pay out $1.2b in quarterly dividends to restive shareholders. At the same time, another $5.6b is being set aside to fund massive customer compensation, with over $100m for victims’ survivors from both LionAir and Ethiopian Airlines disasters.
Nevertheless, CEO Dennis A. Muilenburg notes that Boeing engineers have developed a second MCAS software ‘fix’ for better flight control redundancy. He asserts that the upgraded MAX technology has been acing a rigorous stream of tests, simulator reviews and dry runs toward his anticipated (phased-in) recertification of the grounded 737s by year’s end.
Tell that to the chastened FAA, to global regulators, much less MAXed-out airlines like United, Southwest and Norwegian that are breathing down Boeing’s neck for maximum remuneration, while others like Ryanair have simply stopped making payments on their grounded aircraft. In any case, this is the carry-on baggage Muilenburg brings to two Capitol Hill hearings next week—minus his commercial airliner business chief, Kevin McAllister, whose head has already rolled.
Hearings, Day One: “I would walk before boarding a 737 MAX.” This came from indignant U.S. senator, Jon Tester (D-Montana) October 29 amid the initial grilling of Boeing CEO Dennis Muilenburg on Capitol Hill. The Senate Transportation Committee hearings focused on planemaker and FAA failings with regard to the entire MAX/MCAS fiasco. Issues addressed by lawmakers included cost and scheduling versus safety and quality, as well as more effectively managing risk and safety.
A contrite, rattled Muilenburg and his fellow Boeing executive (VP & Chief Engineer, John Hamilton) were strafed with questions about the company’s responses to the fatal LionAir and Ethiopian Airlines crashes, which combined killed 346 people. Highlighted was the unsteady process of issuing red flag warnings and emergency airworthiness directives, particularly in the wake of the LionAir disaster. Senators cited stifled communication and too cozy managerial delegation between Boeing and the FAA, much less the flying public—not least Muilenburg’s office directly phoning President Trump to keep the MAXs flying domestically, bypassing the FAA as aircraft regulators were already grounding the planes around the world.
Lack of Candor?
Then Boeing later failed to disclose internal Boeing pre-certification text messages from pilot Mark Forkner (Chief 737 Technical Pilot) that pointed to MCAS’s simulator characteristics being “way outside the normal operating envelope” as early as November, 2016 (months prior to 737 MAX certification). Or that Forkner had nonetheless recommended the ensuing removal of any MCAS references from pilot training manuals. This, while the company had been applying undue cost/scheduling pressure on Boeing employees, FAA managers and inspectors all along.
Zeroing in on the MAX itself, lawmakers asserted that the 737 family had grown from “canoe to a cruise ship” dimensions without the developmental assurance of continual (as in legacy) functional safety up and down the line. Rather, Boeing has relied on incremental iterative upgrades (with 14 variants on the 737’s initial certification in 1967), less thoroughly ‘contextualized and disseminated’ to federal authorities, the airline industry and travelers at large.
Chairman Robert Sumwalt of the National Transportation Safety Board then added that pilot performance assessments needed to be better validated. He explained as how that begins with having pilots of a wider range of experience training on ‘conformed’ simulators, preparing them to more quickly, effectively recognize and respond to increasingly complex data inflight (e.g., to safely interface with their plane’s aggressive (if not malfunctioning) MCAS flight control system.
NTSB testimony also touched upon the FAA’s lack of budgets, resources and personnel to adequately monitor and administer the nation’s airline system in the face of dramatic technological advancements industrywide. The result? A systemic, delegated “outsourcing of safety” to cover such shortages has now proven to be “doomed to failure”. (MTC, on the House probe)…
Day Two: Much the same, only harder edged, more pointed. Wherein Boeing’s head and VP-Chief of Engineering get further filleted by the U.S. House of Representatives Transportation and Infrastructure Committee.
Chairman Peter DeFazio led the tense, revelatory hearing by accusing the aerospace giant of placing stock price and buybacks before safety, of pressuring its overworked employees, even delegated FAA managers to push through a heedless productions schedule—lobbying regulators for ‘streamlined’ certification of the 737 MAX—otherwise virtually regulating itself.
The Oregon Democrat charged that Boeing senior management wrongly pieced together a 14th iteration of a 737 model first certified nearly half a century ago, rather than developing a new, clean-sheet aircraft to meet the Airbus A320 challenge. That the Chicago-based company had devised an increasingly aggressive computerized flight control system to compensate for the nose-up tendencies of the MAX’s more powerful dual engines, then essentially hid the MCAS implementation from pilots, the FAA, customers and public alike.
“Flying Coffins”?
Such was one graphic charge, as committee members proceeded to stress that there was no room for error in air travel, that “industry capture” of governmental oversight was “bad business.” Ranking member, Rep. Sam Graves (R-MO), a pilot himself, skeptically plained that increasingly complex aviation technologies are overwhelming “dumbed down” pilots, who have trained predominantly on simulators, fast-tracked to see a chronic commercial pilot shortage. That ultimately, airliners must ultimately be flown by virtue of human airmanship, not just machine automation.
Representatives by turns focused on the particulars of Boeing’s crisis. Their red flags ranged from undue competitive, exhausting pressures on the plant floor to ‘bureaucratic deficiencies’ upstairs to a foot-dragging FAA that was ill-prepared to assess the full impact of the new MCAS technology. They then began dressing down Muilenburg and Hamilton on the particulars.
For instance, lawmakers asked, why was MCAS Boeing’s answer to the issues of nose-up MAX attitudes and runaway trim? Moreover, they questioned the wisdom of engineers designing in a solo AofA sensor—thereby creating a single point-of-failure hazard by circumventing crucial dual sensor redundancy catching altitude and/or air speed disagreement. Or of specifying that pilots would have a ‘sufficient’ four-second window in which to react to each of sequential MCAS programmed nose-down corrections—by poorly, if not uninformed pilots, at that.
For as committee members noted, once the MCAS system was strengthened from benign to robust, all reference to the anti-stall technology was excised from the 737 MAX’s Flight Operations Manual. At the time (pre-crashes), Boeing determined that an MCAS alert would unduly “increase a pilot’s workload.”
Therefore many pilots were flying unaware that MCAS would override their standard trim correction procedures—because no MCAS indicator had been installed anywhere on the flight deck. Nor that the planemaker’s four-second nose-down reaction window actually took 8-10 seconds at best, as MCAS unexpectedly re-triggered again and again without forewarning. That Boeing sat on the program’s alarming maneuvers after the fatal LionAir crash, in the months prior to the Ethiopian Air tragedy—going so far as to cast the blame on LionAir’s flight crew and fleet maintenance, later question the Ethiopian crew’s judgment on airspeed/pitch & thrust adjustments.
Pilots and their unions (as well as wary flight attendants) are incensed by this “catastrophic miscommunication” in a double-disaster sequence that “set the pilots up for failure” in “flying coffins”, and could well have been averted.
Blind Faith or Bad?
Beyond bull rushing MAX fleet certification, Boeing was being accused of misleading (Jedi- mind tricking, as it were) foreign regulators and airline customers as to MCAS’s nature and training requirements—to avoid paying on a sales contract obligation to pay carriers a $1m per-plane allowance for any disruptive MCAS re-training (esp. on simulators) necessity. Meanwhile airline customers are losing billions due to the MAX groundings, and Boeing maintains a 4,400 aircraft order backlog from overseas carriers alone.
So Chairman DeFazio and his panel colleagues were not buying Muilenburg’s claim that he was unaware of many sketchy TXTs and emails being posted on a series of slides revealing the company’s prior knowledge of potential MCAS flaws—that Boeing so informed the Justice Department in June, 2018, but not Congress or the FAA until later in the fall. Rep. Greg Stanton, D-AZ, in particular challenged the CEO’s dodge on the question of how detrimental the anti-stall technology was to Ethiopian ET302’s dive recovery, given that MCAS was described in a June coordination sheet as not a deleterious factor in pilot/plane interfacing or dive recovery.
Other members variously cited Boeing’s 2015 settlement agreements (totaling in the $millions in penalties) for not promptly meeting federal regulations on issues of production quality, scheduling and overall management. How the company is now trying to skirt victims survivors’ access to U.S. courts, in favor of less exacting Indonesian justice in the LionAir case. And is quietly pressing for a tight December deadline on survivor compensation claims.
But they were most antagonized over how Boeing senior executives have been less than forthcoming with critical documents, and stonewalling official investigation of the entire “tragically flawed” MAX scenario. How company managers were on a pay incentive hamster wheel to meet tight cost/scheduling targets. And how the lavishly compensated CEO himself is bearing no material consequence for his company’s missteps and “egregious” mismanagement.
Muilenburg and Hamilton were visibly humbled and withered under five hours of House grilling, dithering on issues of awareness and technical expertise, defensively dodging key yes/no questions, stressing their commitment to “see this crisis through” as they were surrounded by survivors grimly brandishing poster blow-ups of crash victims.
Thus the apologetic CEO fended off repeated demands that he step down, perhaps returning to the Iowa farm life he tirelessly credited with informing his sense of honesty and personal responsibility. It remains to be seen what (AofA vane) direction this top-drawer tug-of-war takes in hearings’ wake. But for the time being, Muilenburg clings to his job with a contrail’s force majeure (as of December 23, he gone…).
So Vamigré will surely continue to follow the trials and tribulations of this turbulent MAX/ MCAS drama (costing Boeing well over $8b to date), as the recertification clock and meter time bombs keep ticking away…
Meantime, nose up, check—pitch stabilized, check—sensors reading left and right: Maybe Boeing’s first big (post-MAX) step should be to move corporate headquarters back to Seattle, where the aerospace giant earned its wings and began its lofty ascent in the first place. After all, Chicago is historically a railroad, not an aerospace town. And a little more onsite engineering than remote control can go a long, long way...juuust sayin’…
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