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Boeing – Stronger and More Determined to Get It Right By Howard Wheeldon, FRAeS, Wheeldon Strategic Advisory Ltd.

 

 

Given the very significant impact of the two tragic crashes of Boeing 737 MAX 8 planes in five months and that led to a total of 346 people losing their lives, for me to suggest anything other of 2019 being THE worst year in the Chicago based company’s long history would be an understatement.

Talk to Boeing people today and one finds them talking about a company that is not only humbled by what it has been forced to witness but one that has also been determined to make every possible effort that it could to support the families of those that lost their lives in both tragic incidents. No one should be under any illusion that that these tragic incidents have impacted on each and every Boeing Company employee. For those who manage this large and very important US company the two separate 737 MAX crashes have left a deep scar that they will never forget. Be in no doubt that Boeing senior management has not only been humbled by what has occurred this year but also that they have redoubled their efforts to ensure that accidents like that of the Lion Air Flight 610 and Ethiopian Flight 302 Boeing 737 MAX airplanes will never happen again.

Last month via video link I had the great pleasure of a ninety-minute long private meeting with Boeing chairman, president and CEO Dennis Muilenburg. A Boeing lifer who had joined the company as an intern in 1985, I had first met him eight years ago at the Paris Air Show at Le Bourget in 2013 having with Teal Groups Richard Aboulafia and I had been invited to conduct a private interview when Muilenburg was president and CEO of what was then Boeing’s Integrated Defense Systems Division. I well recall my view as I left that meeting that I had just met the man who in my view was the natural successor to James McNerney.

Talking to Muilenburg today one finds a man determined to right any wrongs and to leave no stone unturned in so doing. Safety s and remains at the heart of what Boeing is and what it does. Restricted only by an inability to say anything pivotal that might damage the integrity of the ongoing 737 MAX crash investigation and inquiry, Muilenburg was at pains to stress that right across the company and on each and every aircraft programme, lessons from the 737 MAX tragedy have been learned.

The reader of this should be in no doubt that despite the dreadful scar that Boeing will wear from the two 737 MAX crashes in the years ahead, this is a company that in my view will come out of these tragedies not just as a better and stronger company but also one that has been visibly humbled by what it has gone through.

Be in no doubt either that Boeing values of commitment, safety and quality, strategies and policies that made this company great through its long and illustrious history, are no different today than they have ever been in the past.

Never before in that long history and correct recognition of the important things that Boeing has done and indeed, continues to do for the world has the company come under so much scrutiny and rightly so. Fatal accidents in the aviation industry are mercifully rare and yet all within the industry whether aircraft or engine manufacturer, airline or airport operator, know that there can never be room for complacency. Talking to Muilenburg I can vouch that there is absolutely no room for complacency in his crucially important role or in that of those whose job it is to ensure absolute safety. People, particularly those that fly in Boeing airplanes along with those that the company employs are uppermost in the mind of Boeing management today. Just as it should be, there are and neither will there be any short cuts to rebuilding confidence that will clearly be necessary in the months and years ahead.

I am in no doubt that Boeing will rise through all of this tragedy as a better company to the one that entered the worst period in its history. While the focus today may be on the 737 MAX be in no doubt that it extends across each and every product and customer that the company has. NO amount of funding will be spared to ensure that they focus on those that need to be supported and also to ensure that never again will Boeing find itself having to hold its head so low.         

Instances of what the company is doing are many. Back in July Boeing announced that a dedicated $50 million amount of a previously announced $100 million fund to provide near-term financial assistance to families of the victims of both flights and that it had retained Kenneth Feinberg and Camille Biros – both being renowned experts in establishing and overseeing victims compensation funds – to design and administer the fund and which will be completely independent from any resolution provided through the legal process.

With all 387 of the global fleet of 737 MAX airplanes having been grounded since March, the longest grounding of any aircraft in living memory, and with multiple numbers of airlines that bought the plane removing it from flight schedules now stretching into December and beyond as they await the FAA’s approval on software enhancements to the MCAS system, Boeing has been working extremely hard to fix the highlighted issues, test the fix and importantly, ensure that each and every Boeing 737 MAX pilots is fully trained in how the updated MCAS system will work.

In respect of detail of the fix, back in April Boeing announced that it had completed the first engineering flight of a 737 MAX 8 plane flown by its own test pilots in order to evaluate the updated MCAS software. One month later the company confirmed that it had completed development of the updated software including associated simulator testing and engineering test flights.

During May the Federal Aviation Agency (FAA) regulator also held a joint meeting with representatives of 33 regulatory bodies worldwide to discuss a planned process that would allow the 737 MAX to be brought back into airline service. In June Boeing hosted FAA pilots in its engineering flight simulator in order to review specific flying conditions and various possible scenarios. That important event was then followed by the FAA identifying one further requirement which Boeing has subsequently addressed through updated software changes. Since then Boeing pilots have conducted hundreds of 737 MAX flights to test the system more fully.  

For now, there no new news or specific date to impart in respect of when the 737 MAX will be allowed return to commercial airline service. Also, it seems more than likely that EASA, the European Aviation Safety Agency and maybe other international aircraft regulators will wish to conduct their own 737 MAX test flights. What is certain is that by then each and every 737 MAX pilot will not only have gone through a more extended MCAS training process but also that understanding of operation of MCAS will have been made easier.

Whilst we must make some allowance of the difficulty of communication and of what a company such as Boeing is allowed to say in the immediate weeks following tragedies of this nature and that could impact on a subsequent inquiry, it is pleasing to see that the company is not only communication well with its airline customers but with its investors and press and media as well.

The battle ahead of safety reassurance will in part be one of convincing those that fly 737 MAX that the aircraft is safe and that the MCAS software upgrade will ensure that the aircraft will as safe as any other airplane built by the company. That process has already stated and it is one that will of course take time. But, given the effort that the company is putting in to reassure airlines and passengers alike that with the software upgraded 737 MAX is and will be a very safe aircraft to fly I do not envisage this being a major issue following the aircraft being allowed back into airline service.

That the 737 MAX issue will have cost Boeing many billions of dollars by the time that they can finally put this dreadful period behind them cannot be doubted but that Boeing has taken the view that cost of getting it right and compensation for the families of those that suffered are at the forefront of internal policy is to be commended.

As for the rest of Boeing, Muilenburg can be proud that while production of 737 MAX may be stalled that of the other aircraft the company produces is for the most part being raised. Similarly, in defence Tanker programme is now going very well and over 100 test flights have now taken place on the T-X trainer which I believe is now called the Boeing T-7 Red Hawk. Alongside its European partner Saab, Boeing reckon that the market for this military trainer worldwide stands close to 2,000 aircraft worth potentially $40 billion.  

Other military aircraft programmes continue to do well including Apache of which the UK is buying 38 new attack helicopters, Chinook, V-22 Osprey and the venerable F-15 alongside the F/A 18 Super Hornet, the latter having received a $4 billion DOD production contract to produce 78 new aircraft earlier this year.

In respect of other civil aircraft, while the first flight of the 777X has been pushed back a few months 787 production will soon be increased to 14 aircraft per month. The venerable 767 continues in production not only as a basis for the tanker military tanker aircraft but also as a cargo aircraft and for which new orders were received this year from FedEx.    

In conclusion while the outlook into 2020 is made all the more difficult to project until all airlines are back flying 737 MAX, the outlook beyond and particularly for the rest of the company remains excellent. I have in this piece used the term be in no doubt several times and I will use it once more – be in no doubt that Boeing values remain as strong today as they ever did and that despite going through the worst period in its century and more long history, Boeing remains very strong and that it will bounce back I a year or two stronger than it has ever been.

CHW (London – 19th September 2019) 

Howard Wheeldon FRAeS 

Wheeldon Strategic Advisory Ltd,

M: +44 7710 779785

Skype: chwheeldon

hwheeldon@wheeldonstrategic.com

@AirSeaRescue  

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