188 Comments on “Analysts react negatively to Boeing slip of MAX recertification”

1. It’s pretty much what we all expected. I still see the delay will be beyond summer and then the question needs to be asked, what Airlines want to accept deliveries of a large batch of new aircraft in autumn/winter.

   Reply

   • Ryan Air has said if they can’t have them by early summer they don’t want them till early fall.

     Reply

     • Latest form Boeing

       https://www.washingtonpost.com/business/2020/01/22/boeing-has-been-our-own-worst-enemy-missed-deadlines-737-max-ceo-says-he-just-set-new-one/

       April back into production, does not say how many.

       Why not throttle back if going to resume in April. hmmm

       Reply

   • I am certainly not surprised, good to see Boeing being cautious.

     Guess I should be an analyst!

     Reply

2. The deal for Spirit to buy the BBD Aerostructures business requires 630 million in cash on closing. It also requires Spirit to take on a further 590 million in various obligations. As of the 16th they had 700 million cash on hand and 800 million in a line of credit. On that date it seemed they still had the strength to proceed.

   https://seekingalpha.com/article/4317310-spirit-aerosystems-clear-way-to-bet-against-boeing-after-737-max-grounding.

   While the case for diversification seems stronger than ever, but this news will not help Spirit.

   Analysts above were speculating Boeing would pay something to keep Spirit healthy. It will be ironic if those payments are what allow Spirit to close the deal to become a A220 supplier.

   Reply

   • “Analysts above were speculating Boeing would pay something to keep Spirit healthy.”

     Boeing will leave that for Airbus to invest themselves.
     A repeat of 787 times.

     Reply

3. I think Boeing has decided to end the cycle of speculation, anticipation, & disappointment, that has defined the process thus far. It’s better to project long and then improve on that, than to project short and repetitively miss.

   They are in the unfortunate situation of everyone looking to them for progress, but not really being able to control that progress, as it’s in the hands of the regulators.

   Reply

   • ” It’s better to project long and then improve on that, than to project short and repetitively miss.”

     That was the argument given by Boeing when announcing largish 787 delays. … Repeatedly. 🙂

     ” ..but not really being able to control that progress, as it’s in the hands of the regulators.”

     IMU Boeing is still out on delivering anything tangible towards a recertification?

     Reply

     • Uwe, the regulators are auditing the software and Boeing is flight testing it as well, so obviously there have been deliverables at this point. Not yet in final form, as that will depend on the audit results and further testing by EASA to answer their questions, before final certification flights are possible.

       Certification must occur with MCAS active, but EASA has requested tests without MCAS, so the second must happen before the first.

       Reply

       • Rob,

         I have read what Boeing has published about MCAS:

         https://www.boeing.com/commercial/737max/737-max-software-updates.page

         In no part of Boeing’s MCAS description does it say that the MCAS System is necessary for safe flight. So, assuming the MCAS System is not necessary and the fact that Boeing has agreed to give pilots new simulator training, why not remove the MCAS System and get on with getting a certification? Why spend all this time modding the FCC?

         Could it be that a system such as MCAS is actually necessary for safe flight? And if it is, then how does this affect re-certification? If the Boeing 737 Max is found to be not stable at high AoA, then is certification of the 737 Max even possible under existing rules?

         Really…show me a commercial aircraft that is inherently unstable yet has been allowed to fly because of a computer aid. I mean, such things are allowed in military jets because they have this cool option that commercial planes do not: an Ejection Seat.

         Explain this…please.

         Reply

         • Jimmy, MCAS was introduced in order to comply with the regulations for column force behavior at high AoA. So MCAS can be removed, but then another solution must be in place to ensure compliance, or else the regulators have to grant an exemption.

           Note that column force being non-compliant, does not translate to inherent instability. If the pilot lets go of the column at high AoA, the MAX will recover on its own, with or without MCAS. This is because it’s inherently stable, as it must be for certification.

           Being unstable would mean that at column release, it would continue to nose-up on its own until stall, thus stalling itself. No commercial aircraft could ever be certified with that behavior.

           The simplest way to think about MCAS is a trim system at high AoA. The MAX gets out of trim at high AoA due to the nacelle lift, so MCAS adjusts the stabilizer to restore trim for that particular condition. That’s all it does.

           Without MCAS, at high AoA the aircraft is out of trim nose-up (nose-happy), but not beyond the pilot’s ability to correct with elevator. But in doing so, he will notice a softening of the column. That softening is not allowed by the regulations, because high AoA is too near the approach to stall.

           With MCAS, the aircraft is trimmed at high AoA, so no softening of the column and compliant with regulations. The aircraft can still stall, but only if the pilot commands it.

           As far as the FCC rewrite, that was mandated by the regulators. They tweaked the cosmic ray test to force the same MCAS behavior that contributed to the accidents, and not all pilots were able to recover. Since the test was of an artificially induced FCC malfunction, the only solution was to catch it with the other FCC. That’s been a far greater undertaking than fixing the MCAS code, and has more or less dominated RTS.

         • @Jimmy

           “Really…show me a commercial aircraft that is inherently unstable yet has been allowed to fly because of a computer aid.”

           The MD-11 was certified with “reduced longitudinal stability” to improve fuel efficiency and this stability is augmented by computers. It may not be inherently unstable – but the pilots who have crashed them with PIO on landing would argue this point.

           It may have been one of the early designs to require computer augmentation in the flight control system

         • “Jimmy, MCAS was introduced in order to comply with the regulations for column force behavior at high AoA.Jimmy, MCAS was introduced in order to comply with the regulations for column force behavior at high AoA.”

           No. It wasn’t.

         • Rob, If MCAS is there strictly for proper stick force at high AoA, then why not a simple stick nudger, as the Brits did on the 707? Much less risk.
           ============
           https://leehamnews.com/2019/11/01/a-basic-mcas-system-was-installed-in-the-boeing-707-in-the-1960s/
           ============

         • Richard, in this context, a stick-nudger is the same as a stick-pusher. It energizes at the point of entry into stall, together with the stick-shaker, and forcibly moves the stick and elevators. This would clearly be a stall identification and prevention system, which MCAS was never intended to be. MCAS engages before stall and before the stick-shaker, to trim the aircraft at high AoA.

           The benefits listed for this system, are also true of the corrected MCAS, or MCAS as it should have been designed originally.

           EASA may rule that MCAS (or any MCAS-like system that uses the stabilizer for trim at high AoA) is stall identification. In that case the advantage of MCAS is nullified and a stick-nudger or pusher would serve a similar purpose, although activation would be delayed until much closer to stall.

         • Rob,

           The use of the stabiliser is making the column force more severe. In both crashes it exceeded the maximum allowed, 70lb.

           Please explain your logic for the effect of MCAS is opposite to your logic as clearly set out in the Lion Air crash report.

         • Philip, you’re referencing the behavior of the MCAS 1.5 in malfunction, that we know was flawed, and exceeded its authority. The system in question here, that is up for certification, is MCAS 2.0, which will not exceed its limits or the force requirements.

           So my statements are consistent with the behavior of MCAS 2.0.

         • “”MCAS 2.0, which will not exceed its limits””

           That’s not true. Deckard explained why.
           Maybe also a reason why the Transport Canada guy said “MCAS has to go”.

       • don’t munge information and look for “.”, “;” and “,” textual separators.

         = Boeing has found by way of internal audit further issues. =
         = Boeing has been meeting with FAA reps. =

         AFAICS:
         Nothing has been said that Boeing has delivered “something” and that the ball now is in the FAA court.
         again AFAICS:
         Independent of the above Boeing is still out for providing EASA with requested “noMCAS” test specimen and flights.

         Reply

         • Uwe, regulators have been performing the software audit for about 5 weeks now. Holiday in the middle so probably about 3 weeks working time. This means ball is in the regulator’s court.

           Certification and EASA test flights cannot take place until the audit is complete.

         • “Uwe, regulators have been performing the software audit for about 5 weeks now. ”

           Could you please provide some links that corroborate your statement?

         • @Rob

           Let’s say it took Boeing to submit a fix (MCAS, FCCs whatever and still unfinished and still with bugs) almost a year, and you would like to have it approved in hours. Let’s bitch on regulators, let they rush, because Boeing this and that. I don’t accept such twisted point of view. I accept transparency and responsability for own actions and flaws.

         • Uwe, from Reuters article dated January 7. This article does not mention Boeing’s compliance with the November audit format request, which they completed& submitted in mid-December.

           Jan 7 (Reuters) – U.S. and European aviation safety regulators will meet with Boeing this week in an effort to complete a 737 MAX software documentation audit – a key step toward the grounded plane’s eventual return to service.

           The European Union Aviation Safety Agency (EASA) and Federal Aviation Administration (FAA) both confirmed on Tuesday that they will meet in the Seattle-area with Boeing before heading to a Rockwell Collins facility in Cedar Rapids, Iowa, in an effort to complete the audit.

           In early November, EASA and FAA met with Boeing at the Rockwell Collins facility in Cedar Rapids and did not approve the audit. Instead, they sought revisions to the documentation of the 737 MAX software fix and flagged a number of issues, Reuters reported.

           Boeing said in November that regulators had requested the “information be conveyed in a different form, and the documentation is being revised accordingly.”

           Aviation software audits frequently uncover inconsistencies or omissions in documentation but rarely lead to changes in the underlying software or system, according to an industry official.

           Documentation requirements are central to certification for increasingly complex aircraft software, and can become a source of delays. In 2008, EASA nearly derailed Europe’s Airbus A400M military transporter over software documentation following a failed audit.

         • @Rob – another example of documentation derailing a certification rather than actual flaws in the product are the Cobham WARPs for the KC-46 where Cobham had never commercially certified their pods before and completely failed on the paperwork aspect.

           cost them almost 2 years and several tries to get it right.

       • “”the regulators are auditing the software””

         Months ago EASA asked for the software audit, maybe because they are not software freaks. Also they can only ask for an audit if there is a regulation.
         So why should regulators make the audit themselves now?
         Did Boeing provide their own self-certificated software audit?

         If the software audit by an independent person is not finished and issues are not fixed, how can Boeing even propose a timeline for RTS?

         Reply

         • Next up, Ethiopian crash report and what it was even doing flying at all.
           Things are not going to get any easier.

         • Leon, I responded to Uwe above with the Reuters article on the auditor story.

           As far as timelines, Boeing was projecting a timeline for October completion of software, and November audit, with EASA & certification testing in December, and RTS at end of December. In September, both FAA and EASA seemed to be on board with that schedule, based on their public statements. EASA said they might slip into January.

           But then we had the audit format issue in November, which added almost a month, and the holidays which added two weeks. Then Boeing reversed their position on training, based on results of pilot testing in December, so that will add 1 to 3 months. Plus a few new issues in the meantime. Also the regulators have signaled they have no timetable.

           So based on the rate of slippage thus far, Boeing has assumed that further slippage will occur before RTS. The minimum would be April, but could be as long as June or July..

         • This “audit” you are referencing afaik is about the full software gauntlet running on MAX as is.

           i.e. its an audit that Boeing managed to avoid to put it nicely since before MAX certification?

           Intention is to catch further oversights introduced when designing/creating the SW suite.

           This is not the fix needed for RTS. But it is a prerequisite. This can potentially vastly expand the scope of work required for RTS.
           ( See the recent run of Boeing announcements “we have discovered further …” )

         • I think the software audit EASA was asking for in November was only about MCAS and the new FCC configuration. But on Dec 12 the FAA asked for all Boeing self-certification documents, so other self-certificated software too. Boeing never did independent software audits before.

           Now, when these documents are checked mistakes might be found easily.
           Are there documents for the stabilizers/elevators because Boeing made them stronger on the MAX? Is the jackscrew still strong enough for the increased forces?

           This will be a long process. Mistakes which are found now will result in deeper checks.

         • Guys, just to clarify, the software audit was required by the regulators as a condition of RTS. Boeing has done audits of all their aircraft software before, but as EASA was involved this time. the requested format was different.

           Also we are waiting for the results of the audit. There will likely be corrections required but we may never know the details unless there is something major uncovered that would require release to the press. The regulators have been quiet thus far.

           Leon, you’ve referenced the FAA request on December 12 multiple times. I think you may have confused that with either the e-mail documents, or Dickson’s statement that Boeing can best accelerate the process by timely development of requested materials. I haven’t found any demand that Boeing turn over documents that have not been provided previously.

         • “”Boeing has done audits of all their aircraft software before””

           EASA don’t accept Boeing self-certifications because they are not “independent”, especially when Boeing has stupid excuses for not following regulations (i.e. rudder wiring, not practical and costly). If Boeing did quality work there should not be mistakes found.

           Because of EASA the FAA stripped Boeing’s self-certification business. Self-certification means that the FAA was not involved. Therefore Boeing was asked to provide all self-certification documents, otherwise if the FAA had all documents Dickson didn’t need to ask for it. Few days later MAX production stopped.

           Now the MAX is the first Boeing which will be checked independent.

     • Rob,

       Certification must occur with MCAS on and off. The MAX must work with MCAS on or off. Further, certification must address an MCAS malfunction. The MAX must work if there is an MCAS malfunction.

       So no. Your words are not correct.

       It comes back to the JATR report. Boeing viewed the loss of MCAS as “minor”, but MCAS malfunction as “major”. JTAR said malfunction was one above, “hazardous”. JTAR said the loss of MCAS was an open question. Specifically flight tests were required.

       It always comes back to the official reports. Don’t expect the Ethiopian Airlines crash report to be any better. I read your comments on the pilots. Your comments were wrong. Very wrong. I’ll wait for the official report before I comment on what you said.

       I hope my reply is civil.

       Reply

       • No issue with Civil but the usual twisting of the facts.

         The core issue was Boeing assessment of MCAS failure being miner. Said failure is NOT it did not work, it ran away (per a run away Stabilizer and it more than given that the two ARE NOT the same).

         That in turn lead to zero protections from MCAS software going nuts as well as the issue with its being jacked up aggressive wise .

         So failure was it acting vs it not acting which would have been no issue.

         What it could do if it did act with a bad AOA was never looked at (and I continue to find that bizarre and did so from the start).

         Turn off the stab and you can fly the MAX fine.

         Doubt it>

         Well turning MCAS off was EXACTLY the fix per Boeing.

         Why? Its the Stab doing what you don’t want, so you turn it off.

         Its in the Book. It was badly put in the book without the backup details and there is zero question Boeing is guilty as hell of downplaying it.

         Now why is turning the stab off not a big deal?

         Well, you don’t never fly in the envelope area (stall) that it would be acting (or better yet, SHOULD be acting)

         Or, how many LGA do you hear being stalled each year?

         Granted its more likely Boeing that Airbus though you can outmode the Airbus as well.

         In fact stalls are so rate 5 years ago most Flight Simulators could not even do a stall.

         Why? They did not teach stalls becau8se they felt they never occurred (granted that is stupid)

         Primarily due to AF447 they have realized, oooops, I guess they can screw up (pilots) even on an Airbus.

         There is no question that Boeing screwed up hugely in turning a tiny aspect into lethal. Not the first time nor the last that has happened in history.

         Tacata? For Exploding Firestone tires (another cut to the edge cost savings) – never underestimate the power of human stupid and have a robust regulatory system in place to catch it.

         Yes the FAA failed miserably and the ODA needs to be fixed without any question.

         Reply

         • It’s not “miner” it’s “minor”. But no Boeing said it was “major”. The reports said it was “hazardous”. Please read the reports.

           Your usual behaviour of expecting everybody to believe you represent the facts when you just make it up.

           I hope I’m being civil. Have a nice day.

         • Philip:

           Fully civil.

           Still off the rails in regards to the Supposition.

           Massive Preponderance of evidence says the Earth Orbits the Sun, not that the sun orbits the Earth.

           At least the original theory had a basis of trying to explain the reality of the planets, motions etc in relationship to the observers.

           You picked up on one term, Pitch Up and then took it out of context.

           Aerodynamic experts have told you that you are wrong and you still persist in a bizarre supposition.

           It really has not more basis than if I contended that Europeans are cannibals. When there is no basis of facts then its totally hollow.

           I find it most puzzling.

         • TW,

           I produced a theory more than a year ago. Both the official reports now make clear that the basis of my theory is correct. The MAX has pitch instability.

           It’s now down to severity. A US pilot told LNA that MCAS is a required element of certification. So the severity is greater than “minor”. Nothing “minor” is ever required as per as the definition of a FHA.

           So it’s “major”, “hazardous” or “catastophic” as per a FHA.

           If EASA declare the pitch instability to be either “hazardous” or “catastophic” then MCAS cannot fail. If MCAS cannot fail, dual channel is not enough, never mind dumbed down dual channel. Why? The failure of one channel means MCAS has failed. See Peter Lemme’s work for confirmation.

           Even a “major” hazard is iffy. It depends. Dual channel is enough only if a channel fails passively. That means it doesn’t make matters worse. Let’s see what EASA says.

           I accept that civilian airplanes don’t stall. Why? They are naturally stable. The MAX isn’t naturally stable. That why it will be grounded for at least 15 months.

           As per usualyour commentary is judgemental of others. But you never offer a basis for your judgement except your opinion of others. Please provide a basis for your judgement of others that is not your opinion of others. I take the view that your failure to do so is insulting and abusive and contrary to the rules of this web-site.

           I hope I’ve been civil. Have a nice day.

         • the Firestone tire thing was actually nothing to do with the tires, and everything to do with stupid lazy humans and America’s nearly useless driver training process (even the strictest states are comically insufficient to need)

           Ford’s “recommended” tire pressure was optimized for passenger comfort in the lightly loaded use case. Ford also didn’t clearly state “air up your tires to X if you load up the car or tow” in giant red letters on the dashboard.

           but Ford did state in it in the owners manual, and the tire itself was fine when inflated properly.

           the kicker here is that the tires used to replace the “defective” firestones actually have a worse safety record.

         • Phlip:

           You made a terribly revealing statement, and no its not a theory, cherry picking a few items out of manyu reports does not make it so.

           “Civilian Aircraft Do Not Stall because they are inherently stable”

           No, LCA do not stall because pilots do not put the nose up into the 20 deg area. While a stall has variability to it, nose being high and separating airflow on the wings is what a stall is.

           Clearly you have never flown any aircraft let alone done any stall training. And yes I have.

           I continue to be astonished at the ability to cherry pick a few details and spin it into the Sun revolves around the earth.

           There was a guy a while back who was going to party balloon himself up a few thousand feet to prove the Earth was flat. Yes we still have flat earthers.

         • TW

           I never said “inherently”. Never said that.

           Experts have not said the MAX is stable. That why it’s on the ground.

   • To me it sounded more like they’ve stopped projecting altogether, other than to suggest possible earliest dates.

     The situation is all of their own making, and owes its origins to way back when in the MAX development the pitch up characteristics were found to be unacceptable (for whatever reason).

     Had they done any CFD or windtunnel work, it’s entirely possible that point in time could have been before they’d announced the MAX.

     If at that point they’d admitted to themselves (and then the customers and shareholders) that the 737 had been stretched too far, sure that’d have screwed up all the order they’d accepted, if any.

     They’d have had to start work on a new model. And had they done that, that’d likely now be in revenue service and selling like hot cakes. Hindsight is a wonderful thing, but I think they were astoundingly short of foresight back at that time.

     Reply

     • “”Had they done any CFD or windtunnel work, it’s entirely possible that point in time could have been before they’d announced the MAX.””

       Boeing increased the fan diameter twice than originally designed because the economics vs the 320neo were not good enough.

       As in the emails, clowns desined the MAX and monkeys managed it.

       Reply

     • Actually Boeing did extensive wind tunnel testing, as Duke has pointed out. Also they tried a number of aerodynamic solutions in the tunnel before settling on MCAS. That occurred in the 2012 time-frame, so well after MAX was announced, and well into development.

       Reply

   • “it’s in the hands of the regulators.”

     ??? Uppsss

     I see Jose Mourinho putting from behind a finger into Tito Vilanova eye in front of cameras and then saying that because he was aggressive.

     The Guardian pointed it well: “José Mourinho turned to violence against Barça to mask his own failure”

     Reply

   • Yes, it now feels that Boeing is much more honest and conservative with the new CEO. Just admitting that simulator training is a good to get pilots experienced in a new aircaft type is logical and hopefully will Boeing develop the training program will all sorts of combined faults the pilots has to work thru and threw in a couple of combinations like engine fire on #1, the other jumping into alternate mode, tyre explosion, bus bas error, cabin pressure error, slats stuck, thrust reversers locked on MEL, APU out on MEL, 2-3 computer screen blackout, autopilot out and a few sensors and computers going down simultaniously. I assume readers of this posts can come with ever more tricky 737MAX simulator cases.

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     • Claes, I think this is right, and is what Boeing discovered in the pilot testing in December. Pilots did not initially do the expected things, within the timeframe that Boeing had expected and used as design standards. That pretty much settled the training argument.

       This points up the work that remains with regard to the role of automation, and distribution between pilot and computer. We tell pilots that the first rule is “fly the plane”. Yet one criticism of the testing was that pilots went first to their manual flying skills, instead of finding and running the right checklists.

       So we need to do better at training a consistent approach to problem solving, that involves both elements, and then we need procedures that allow time for them to work through those steps consistently.

       What you’ve suggested above, is also badly needed. TW has mentioned this before as well. Pilot training now is that the instructor walks them through the correct procedure, then they are asked to repeat. That’s fine for teaching and learning, but they also need to handle the unexpected in the real world. So scenarios that throw random problems at them, are a good way for them to develop those skills

       Reply

       • >Pilots did not initially do the expected things, within the timeframe
         >that Boeing had expected and used as design standards.

         This is one of the things that has surprised me about the entire saga. The industry as a whole seems to buy into expectations like “pilots will respond to memory items correctly within 3 seconds” without any verification. Now this would be ok if verification is hard to come by, but it is not have been. Just putting a random selection of pilots into a simulator and checking their responses seems to have pointed out the problems with those assumptions.

         Why is this not standard practice. What other unverified assumptions are part of the certification process?

         A cynical person would say the air framers are happy not to test these assumptions for fear of what might be found and the resulting rework required. Instead they leave that to the certification authorities who have not been proactive in updating those assumptions.

         Reply

         • jbeeko, I think one of the issues is that the shortage of pilots has changed the average source and training levels for entry-level pilots. It used to be that most pilots came out of the military with excellent training and experience. That has diminished due the large growth in flights. A much larger percentage is now civilian.

           Another issue is skill erosion due to automation. Many concerns have been expressed about that, well before these accidents, and I think we’re seeing now that this effect is real.

           If you combine these two, with less experienced pilots coming into the field, and then also not getting the same developmental experience after they are working, due to automaton, you can see how we get to the current state.

           Until there is an emergency, this doesn’t matter much. Most pilots are more than adequate for day-to-day operations. But they may lack the higher skills needed when something goes wrong. Ironically the more effective and reliable air-safety is, the less experience with adversity pilots will have.

           So I think training needs to reflect these new realities. Pilots need a chance to hone their problem-solving skills, recognizing that their days jobs may not provide that as sufficiently as before.

         • Rob

           Focusing on pilot skills and lamenting the loss of skill due to automation misses the point. Ever more automation is the future of aviation (as most industries), but manufacture needs to take into account that people are not good at jumping quickly into an emergency situation. The best trained people will struggle in the face of an emergency if they spend much of their work time monitoring.

           In automotive terms aviation is at around level 3. The aircraft can do many/most things but requires a human to intervene quickly and correctly if something goes wrong. Waymo has decided not to produce a level 3/4 car because the expectation that a driver will respond correctly when needed is not realistic. And indeed the test drivers have on occasion not intervened when needed because they got bored. Waymo has decided that the only safe self driving car is one that can bring any situation to a safe outcome at least as well as a human.

           Now of course pilots are much better trained than drivers but despite that the aviation industry is learning the danger of near full autonomy with a human supervisor.

         • jbeeko, that’s an interesting perspective, because knowledgeable and experienced humans are still far more capable than automation at responding to unforeseen situations. In that sense the ideal combined human-machine system would emphasize the strengths and minimize the weaknesses of each element. Fortunately these are complimentary, automation does well at things humans don’t and vice-versa.

           I think the key for the human element is being knowledgeable and experienced. If they are not, then yes, they will be a source of errors and will not be able to step in and resolve problems with automation. But I think if they are well-educated for that task, they will.

           Just as we improve machines for their tasks, humans can be improved as well. But the interface also is a critical element, it has to adapt the mismatched capabilities of both elements, for fluid and intuitive flow of both control & information.

           And it has to keep things active and interesting for the human, preferably by multitasking in ways that engage and enhance situational awareness. To put a human in charge of a machine doing a dull and monotonous task, doesn’t really relieve the human of the monotony. Self-driving vehicles with monitors being a good example.

           Maybe you’re right that one day, AI will have the capabilities of humans, and then the human really won’t be needed. We are still a ways from that at present. So I think the combined system will be with us for awhile, and it would be wise to invest in that system.

     • epiphany or just yielding to pressure?

       Reply

4. It’s still necessary to remember that the regulators are reviewing Boeing’s proposed solution. That means there is no agreement that the solution is acceptable. In turn, that means Boeing’s solution may be rejected.

   We come back to the flights that have not taken place. EASA have not been allowed to fly the MAX with MCAS turned off. Why not?

   I think it is clear that MCAS, as a US pilot put it to LNA, is a required element of certification. In other words, the pitch instability is serious. But the pitch instability cannot be controlled by the elevators so it must be controlled by the stabiliser. Why? I want that questioned answered.

   With regard to the FCCs. They are not being linked as per the true definition of dual channel. They are being linked to perform a simple disagreement check. No more. See Peter Lemme’s work. True dual channel means both FCCs have the same information. So, for example, both FCCs have access to all sensors.

   Moreover, there is no indication that the FCCs are going to isolate failures. For example, from Peter Lemme’s work, I noticed that there was an error code for alpha vane failure. But it wasn’t triggered even though the left alpha vane AoA was out of bounds for both crashes.

   So, yes the FCCs are being linked. But it’s not dual channel. It’s a dumbed down version of dual channel.

   And so on.

   The chief issue is the use of the stabiliser. It’s being used to generate a significant upward force to counter the forward lift of the nacelles. In doing so, the stabiliser is opposing the elevators. Not good.

   Reply

   • “We come back to the flights that have not taken place. EASA have not been allowed to fly the MAX with MCAS turned off. Why not?”

     I think that is the Billion-Dollar question, and I am amazed that Boeing has yet to demonstrate the in-flight stability of the 737 Max without MCAS. Could Boeing be hiding something?

     Here’s the Question: What happens if it is determined during flight testing that the Boeing 737 Max is not acceptably stable at high AoA?

     Reply

     • Frankly it does not matter what the link up between FCC is as long as it
       1. Is safe
       2. Make the FAA happy as it never was an issue with 5000 some NG and a few thousand more Classics and originals.

       Stabilizer remarks of course are alternative facats, but that is not new

       Reply

       • The fact that the MAX will be grounded for at least 15 months because it has stability issues is fact,

         Reply

       • @TransWorld

         “Stabilizer remarks of course are alternative facats” as @Philip always repeated it’s a theory, not fact. In my opinion a theory well presented and well argumented. For lack of data & transparency from Boeing we have to wait for EASA tests, maybe they will be more open about this theme.

         Reply

         • Suggest that as, according to Reuters, BA have dug themselves a $25 bn hole with the MA grounding, they would have long ago re-certified MAX without MCAS if they could. Penalties for changes on type cert, simulator training etc would have only been a fraction of this bill. My guess is that there are more, unanounced, changes involved. MCAS probably needs to be bulletproof.

         • A theory requires some sort of basis for postulating.

           There is none for the so called instability aspect.

           In fact, there is massive preponderance of evidence it does not exist. In reality its so untrue that is beyond belief and we are getting off the edge of the know Universe.

           In fact its like arguing that the Sun Revolves s around the planets in this day and age.

           Its not remotely a theory. Its purely TFH.

         • TW,

           Only what the official reports say. Both reports make clear there is instability. See my comments above as my main reply.

           I hope I’m being civil. Have a nice day.

         • Pablo,

           Thanks. Most my theory is now fact for the official reports support the theory. Still question marks with regard to the elevators.

           Having said that, the elevators are likely to be too small when the stabiliser is being used in a manner that severely opposes the elevators.

           Boeing history is a history of small elevators. That history is fine provided the stabiliser is not used in a manner that opposes the elevators.

   • Philip, EASA has not been prevented from flying the MAX. EASA won’t make the test flight until the software audit is complete, so they are testing the full and near-complete product. They also want to test with and without MCAS.

     The without MCAS case is not part of the certification, it’s to answer the JATR questions. But they may ask to change the certification requirements, based on the results of this testing.

     Also pitch can be controlled by the elevator at high AoA, but the required column forces did not meet the regulations. By re-trimming the aircraft at high AoA with MCAS (neutralizing the nacelle lift), the column forces were corrected and met the regulations (neutralizing the force change). That was one possible solution to the problem.

     On the FCC reconfiguration, the 737 is designed to have full independence and redundancy for left and right sides, with separate sensors, ADIRU, FCC, displays, and controls. The two sides will now cross-check results with each other, as you said.

     The two sides do have access to either side sensor data through the communication channel. But to do fault isolation would require a third redundant system. That’s required for full-authority FBW but not for a pilot-based system. So in that sense, you could say that a 2-unit system is a dumbed-down version of a 3-unit system. It doesn’t attempt to isolate the fault (beyond a few known values), it just alerts the pilot that a fault is present.

     You mentioned Peter Lemme’s work but not his conclusions. He has supported this change and has said it’s a significant improvement. He had been advocating for it since the two accidents, and was pleased that it would be implemented.

     Jimmy, the questions to be answered by EASA are not whether the MAX is acceptably stable, that is not an issue as it can be flown perfectly well without MCAS, as Bjorn pointed out. But there are two questions raised by JATR, on opposite sides of the stall condition.

     The question before stall, is whether the pre-stall correction by MCAS represents stall identification or prevention. If so, that subjects it to a different set of regulations. The question after stall, is whether MCAS interferes with recovery from stall by the pilot.

     So we will have to see what happens. If either of these are found to be true, then Boeing will have more work to do.

     Reply

     • I want to be civil. But you say:

       “The without MCAS csse is not part of the certification”

       Not according to EASA. EASA want to fly the MAX without MCAS. With regard to that, Boeing wanted the MAX to be certified last year. So why didn’t Boeing invite EASA to fly the MAX with MCAS turned off?

       Reply

       • Philip, I meant only that we already know that the MAX is non-compliant without MCAS. So the MAX cannot possibly pass certification without MCAS, or another solution, or an exemption.

         Since Boeing has proposed a remediated MCAS as the solution, the certification flights need MCAS to be active, to have any hope of certification.

         EASA wants the JATR questions to be answered and so will run their own tests, with and without MCAS. They also may choose to do certification flights separately from the FAA.

         EASA was scheduled to do their test in December, after the software audit was complete. That has been delayed by a month, mostly due to Boeing not having their documentation in the format the auditors wanted, and also by the holidays.

         Reply

         • “EASA was scheduled to do their test in December, after the software audit was complete. That has been delayed by a month, mostly due to Boeing not having their documentation in the format the auditors wanted, and also by the holidays.”

           You don’t know that! Prove it!

         • There have been several delays factors.

           The reality is that its delayed but the delays are due to finding issues with integration that was not part of the issue of MCAS.

           In fact, no 737 has ever reported the so called issue.

         • Jimmy, this story was reported October 21, by many news outlets:

           “For me it is going to be the beginning of next year, if everything goes well. As far as we know today, we have planned for our flight tests to take place in mid-December which means decisions on a return to service for January, on our side,” EASA executive director Patrick Ky said late on Friday.

           He said a return to service of the MAX would be coordinated with the FAA as much as possible, but that the two agencies had slightly different processes and consultation requirements.

           “So we may end up with a couple of weeks of time difference but we are not talking about six months; we are talking about a delay which, if it happens, will be due mostly to process or administrative technicalities,” Ky added.

         • “Jimmy, this story was reported October 21, by many news outlets”

           Prove it. Show the link!

         • Jimmy, take your pick, 7 hits on this page alone. Many others besides these.

           https://www.google.com/search?&q=we+have+planned+for+our+flight+tests+to+take+place+in+mid-December

         • “Jimmy, take your pick, 7 hits on this page alone. Many others besides these.

           https://www.google.com/search?&q=we+have+planned+for+our+flight+tests+to+take+place+in+mid-December”

           Read the first link that came up….it did not make your case.

           As a result, I am not convinced you know what you are talking about.

         • Jimmy, I did read that link and it’s the same story as the others, an interview with Patrick Ky as quoted above. Everything in it supports what I’ve written here. You questioned the factual basis for my statements, now you have it. You don’t offer any arguments to the contrary. So I guess we leave it at that.

         • You’re being obtuse; and deliberately so, in my opinion: EASA want to fly the MAX without MCAS,
           and, so far, have not been allowed to do so. Why, in your opinion, might that be?

         • Why, Rob, are you evading the question, which is:

           Why have EASA not been permitted to do what they’ve very reasonably asked to do , after two 737MAX
           crashes and 346 lives taken thereby- to fly the 737MAX
           with MCAS turned off? Seems like a fair-enough request, no?

         • Bill, that argument has been refuted endlessly.

           EASA needs to complete the audit before they will fly their tests. The tests were originally scheduled for mid-December because it was expected the audit would be complete by then, as it was started in November. But instead, EASA asked Boeing to provide the documents in a different format. Boeing did that and delivered the documents in mid-December.

           All of this is documented in news articles, links for which I have provided. If you have evidence to the contrary, you’re welcome to present it.

       • Rob,

         At least you accept that the MAX does not meet certification requirements without MCAS.

         We know MCAS will turn itself off if there is any sensor disagreement. So every time that happens, the MAX is flying contrary to certification requirements.

         You have said that you have read Peter Lemme’s work. His October article offers insight. But please understand, it’s about the first version of MCAS. Having said that, it does address the words fail-passive and fail-safe.

         The new version of MCAS must meet the definition of at least fail-passive, if not fail-safe. Please look up the definitions. Peter Lemme kind of assumes his audience know.

         The question is: Does MCAS meet the defintion of fail-passive or fail-safe. Turning itself off when there is a sensor disagreement? That is not fail-passive or fail-safe. It leaves the pilots to fend for themselves, flying an airplane that doesn’t meet certification requirements.

         In short, if something goes wrong, MCAS runs into the bushes and hides. So it’s not there when it’s needed the most.

         The link to Peter Lemme’s article.

         https://www.satcom.guru/2019/10/flawed-assumptions-pave-path-to-disaster.html

         I hope I’ve been civil. Have a nice day.

         Reply

         • Philip, aircraft are permitted to continue flight if a system fails in flight. There are many systems required by regulations that can be turned off at the pilot’s discretion if they aren’t working properly. Provision for that is consistent with the regulations.

           The systems have to alert the pilot to the loss of functionality. The system cannot be designed such that a failure results in loss of control. The pilot is the system ultimately in control.

           Loss of the MCAS system will not result in loss of control. We know from the statements of Bjorn and other professional pilots, that the aircraft is inherently stable with or without MCAS, and can still be flown perfectly well. No other flight system is dependent on MCAS. MCAS is only active in a portion of the flight envelope that is rarely encountered. It wouldn’t be a significant concern.

           Earlier the concern was that MCAS would have unintended activation, as occurred in the accidents, and thus would be unsafe. That was basis of this change. Now the concern is that MCAS being deactivated is also unsafe. That doesn’t leave any acceptable outcome.

         • Rob

           To address your first paragraph. Only if the loss of a system is non-critical. To give an example: The triple hydraulics of the elevator. The airplane can’t take off without all three.

           You have a lot to learn. You are a baby. An innocent.

         • Philip, the point of my statements was that MCAS is non-critical. The MAX will fly perfectly well without it, unless the pilot pulls back on the stick to get a high AoA condition. Then he will have less force on the column than is allowed by regulation, but still perfectly controllable. Letting go of the stick will still result in recovery.

         • @Rob

           “the point of my statements was that MCAS is non-critical”

           Big supposition – maybe is non- maybe is critical. That’s a big question to which we all expect transparent answer, imo Boeing failed in this matter, so all the hope in EASA.

           “The MAX will fly perfectly well without it, unless the pilot pulls back on the stick to get a high AoA condition.”

           Unless… pilot will need to do such manoeuvre and then will be in trouble. Such danger should be eradicated.

         • Rob,

           Then MCAS is not needed for certification. You can’t have it both ways. Either it’s required or it isn’t required.

           Something that is required must meet extremely stringent regulations. Something that isn’t required are subject to far less stringent regulations.

     • @Rob

       “EASA has not been prevented from flying the MAX.”

       Did you ever heard that is the manufacturer who is obliged to deliver an aircraft for certification?

       Did you heard that Boeing delivered to EASA an 737 MAX for certification? Well, I’m not, I think nobody?

       So what are talking about men???

       By the way, EASA or any regulator in not to fly an aircraft for flying, they are for certifying.

       Reply

       • Pablo, EASA requested specifically to do their own tests with their own pilots. They won’t run their tests until the audit is complete.

         Reply

         • I know what EASA requested – a live test with & without MCAS, and I know that they didn’t get it still. So, EASA is “prevented” (your wording) by Boeing from flying MAX.

           Pls again, don’t mispresent facts to fit tthem to your narrative.

     • Rob, if MCAS is there to pass two pull back to stall tests, if it is stall prevention, then how would they complete those tests? This assertion seems a little far fetched.

       Reply

       • Ted, I agree completely that MCAS should not be considered as stall identification or prevention. But the problem is that the range of AoA over which these thing occur is so narrow, that it depends on which end you choose to approach.

         Working forwards from level flight, you have the MCAS range beginning at perhaps 10 to 12 degrees. But it remains active into stall at 14 to 16 degrees.

         Working backwards from stall, you have MCAS active and not turning off until 10 to 12 degrees.

         So the narrow range and the overlap opens up the question. The above is the conceptual view, but as others here have pointed out, the letter of the regulation will be what matters. However since the regulations don’t address systems like MCAS, there is room for interpretation there as well.

         All-in-all, JATR is right that Boeing should have clarified this in an issue paper beforehand, so we wouldn’t have ended up here.

         Reply

     • >Philip, EASA has not been prevented from flying the MAX.

       Where did that commenter, or anyone else, make that claim?

       The question, one again, is: why have EASA been prevented
       from *flying the 737MAX with MCAS turned off*?

       Reply

       • Bill, asked and answered above, and also in several other threads.

         Reply

   • “”EASA have not been allowed to fly the MAX with MCAS turned off. Why not?””

     I think EASA was not ready yet for flight testing. On Dec 12, Boeing was asked to provide all self-certification documents. Did Boeing deliver everything? IIRC EASA flight tests were scheduled for this week. Is the new issue delaying the process? Is the software audit finished and are recognized issues fixed? If issues are still present flight testing makes no sense.

     If Boeing is saying that MCAS follows regulations, EASA can wait with flight testing till other issues are fixed. Obviously Boeing is playling a game but that’s not EASA’s problem.

     Trump said that relations with China are very good. What does China know about MCAS that we don’t know? Or does Trump know that MCAS won’t work and he is very polite?

     I can’t believe that Boeing provided all self-certification documents because they will show the issues.

     Reply

5. It is good to see that the analysts start to analyze rather than drinking the Boeing cool-aid. 🙂

   So welcome to reality and finger crossed for a RTS in the Fall (with a re-certification early summer)

   Reply

6. Is it Calhoun looking for a break from the past over promising and under delivering. Taking us back to the revised 707 wing if my poor befuddled memory serves me right. I hope so, this was a tragedy and then a corporate disaster followed closely by a calamity. Now it is simply a saga

   Reply

   • The one thing worse than bad news like this is making up BS to disguise it… That’s likely the thinking now, plus saying as little as possible.

     I say “saying as little as possible”, because one possible way out of this, as I and various others scattered around these hallowed pages are suggesting, is to scrap it and start again. Keeping that as quiet as possible right up until they’ve actually decided to go with it would be very, very important. Such news would certainly push Airbus into launching a new model too, which might finish off Boeing altogether; Airbus can afford to really maximise the design improvements, Boeing likely can’t.

     Airbus might be deciding to do that anyway, but that would be Airbus going for Boeing’s jugular with a large knife in hand… Staying ahead of Boeing is not their only business challenge, so they may feel compelled to go this way anyway.

     Reply

7. Around 800 737 Max aircraft have been built; 387 of which have been delivered. With the halt in 737 MAX production now likely to be extended for up to a year, or more, perhaps Boeing should just call it quits on the programme and not re-start 737 MAX production.

   Of course, Boeing should still be working on getting the 800 737 MAX aircraft (that’s been built) re-certified, but on a less aggressive time schedule. If re-certification only occurs in 2021, so be it. The MAX will still have some economic value.

   What Boeing could do, on the other hand, is to aggressively develop a new single aisle family in four years; developed on an “accelerated schedule” while using all of the necessary resources available within the Boeing company (i.e. sufficient key personnel etc.)

   IMJ, this is doable if the fuselage and wing are made out of conventional materials (aluminium fuselage/wing) and if the aircraft would be developed using 787 cockpit and avionics and the existing engines that’s in use on the A320neo family (i.e. LEAP-1A engine from CFM and PW1100G-JM engine from P&W).

   In contrast, Airbus launched the A320 on the 2nd of March, 1984, first flight occurring on 22 February 1987 and with the first A320 delivery to Air France on 28 March 1988.

   So, if Boeing were to launch a new 797 single aisle aircraft in the first quarter of this year, EIS could occur in early 2024.

   The first model should be a 797-9 — a direct A321neo competitor. The second model (797-8) would replace the 737-8 MAX and compete with the A320neo, while the third model (797-10) would be slightly larger than the 757-200.

   Reply

   • A320 NEO, launched 9 years ago, first flight 6 years ago and introduced into service 4 years ago. A straight forward re engine and a bit of tweaking, still having production problems.
     The 737 and A320 are vast industrial programs.

     Reply

     • A320 — a four year development programme for an all new airframe using existing engines.

       A320neo — a straight forward re-engine programme where delays were primarily caused by the all new engines. BTW, A321ACF-related production problems not happening with the A320neo. Production problems with the A321ACF caused by Airbus underestimating what the modifications to the A321neo would actually entail, while significantly ramping up production of the A321neo.

       797 — an all out, four year development programme for an all new, conventionally built airframe using existing engines –should be doable.

       Reply

       • There is a reason why planes today are a much better mousetrap than 20..30 years ago.

         Development effort has expanded quite a bit over time.

         1930:
         Ju52/1 took much less than a year to FF.
         Ju52/3 took 2 month from FF to EIS ( kind of a NEO: 2 engines added )

         Reply

         • 1995 (EIS of 777) is much closer in time than 1930.

   • That post could have been written by me. Applause! 😀

     One small edition is that Boeing should also finish the MAXs that are half built, with fuselages sitting at Spirit for example. And if there is still demand from Southwest or Ryanair, build a few on top of that. But cancellations will roll in plenty anyway.

     Reply

     • Ok, one thousand units built and delivered — and that’s it! 🙂

       Four thousand MAX orders converted to the 797.

       Reply

       • Moving orders without markup?

         Boeing would be broke after converting the first 500 orders.:-)

         What was the rebate level to move MAX frames? 50%? lower still?

         Reply

         • 1) 737 MAX customers won’t be able to get hold of many A32oneo family aircraft before 2025/2026.

           2) Boeing would only launch the 797 with MAX customers agreeing to switch and convert most of their MAX orders to the 797.

           3) Airlines don’t want Boeing to go out of business, so conversion negotiations would very likely be undertaken in an amicable fashion. Win-win for both parties (airlines and Boeing)

           4) A rebate of 50% appears to be normal operating procedure for both Airbus and Boeing. Catalogue prices are relatively meaningless. In fact, Airbus has dropped the long-held policy of publishing catalogue prices for its product line due to their relative irrelevance to real-world deal values.

   • I very much doubt that a four-year timeline for EIS would be possible today. For anyone.

     Reply

     • And amazingly speculative, verging into Sci Fi. (beam me up Scotty)

       One thing Boeing is good at is recovering form disasters, they have had plenty of practice!

       Reply

     • Four years is more than enough for a conventionally built aircraft — that is, if you’re Boeing or Airbus, and not COMAC or UAC.

       The key words here are conventionally built — i.e. wings and fuselage made of aluminium, with avionics and system architectures re-used from latest generation widebodies.

       Hence, it’s the aggressive use of new technologies that is the main cause of delays in the LCA industry. In contrast, military procurement delays are not relevant to the LCA business model as they are too often caused by underbidding on cost-plus contracts and managerial incompetence.

       Interestingly, the 777 took 4 years and 7 months from programme launch to EIS. However, Boeing reportedly busted the 777 development budget by up to 100 percent, but that was done in order to come in on schedule — and the 777 didn’t have readily available engines waiting in the wings. They had to be developed simultaneously with the 777.

       Reply

       • Lets see, 787 engine, A320NEO engine, A330NEO engines, 777X engine, all had to be developed.

         Reply

         • And the LEAP-1A and the PW-1100G-JM engines have been developed.

           What’s your point?

         • Well you said the 777 original did not have available engines

           Its the norm not the exception .

           Just point that out and curious what the intended relevancy was.

         • Yes, the engines for the original 777 had not been developed when the programme was launched in October 1990. The engines were developed concurrently with the 777 airframe — yet, it only took four years from programme launch to EIS.

           In contrast, a 797 would be the exception to the norm since the engines that it would use have already been developed and are in operation with the A320neo family. Hence, fours years from programme launch to EIS should be doable.

         • Ahhh, I see the assumption.

           IF we are talking about the 797 NMA per previous Boeing then no, the engines are not developed and wold be the same as pretty much all the rest.

           I would have to sleuth it a bit but I think the 727 and the 737 used developed engines but its the norm to concurrency of development.

           747-8 no.

   • OV-O99, I agree with your prescription for the 737 replacement but if the Max is re-certified (which is very likely in my opinion (guess)) I would do the biggest one second (it’s the “NMA”) and the Max-8 replacement last. The Max 8 is in a sweet spot and will keep selling during the transition (assuming no more control system related issues (crashes).

     Your timeline, given all the evidence of recent history of both B and AB is, IMHO, unrealistic. An honest 7 or so years should be allowed which also allows time to do a CFRP wing which would give them more of an edge against the A-320 series aircraft. They will also have to do two wings to cover the whole short/mid range and the 4500ish NM range optimally which also would give them an edge vs. AB.

     Reply

     • The 797 doesn’t need a CFRP wing — too early anyway for a single aisle CFRP wing, and the 797 doesn’t need to have much of an edge over the A320neo; by the nature of single aisle market, a 797 would get Boeing back to single aisle market parity with Airbus much sooner than the other two alternatives:

       A) Keeping the “mortally wounded” 737 MAX alive. Will always be a drag on Boeing and each aircraft will very likely have poor residual values.

       B) Developing an all new NG single aisle that would depend on using technologies still at TRL-level 4/5; with EIS not possible until well after 2030.

       As for the timeline, please check out my other comments above. IMJ, four years is very doable.

       Reply

       • Yes the 787 does need a major advantage over the A321, otherwise Airbus could undercut the price all the time, as they have volume.
         Thats Boeing ‘business case’ problem, they need to have a pathway to make money on a total new development at say 50% higher price than an A321 and airlines will only pay that for a plane that saves them money.

         Reply

         • Maybe I am off to lunch, but as I understand it the A220 does have a CRFP wing and its one of the major aspect of its performance?

         • @Dukeofurl

           Really, a 797 would require 50 percent higher price than an A321neo?

           If you’d said 5 percent, you’d be more credible.

           In fact, the 797 would have massive market potential.

           1) The 797 airframe should be at least 5 percent more efficient than the A320neo airframe. (i.e. 30 year newer wing design etc.).

           2) The A321neo would face competition from a similar sized 787-9 and a larger 787-10, the larger of which could be sold with a price premium over the A321neo

           3) The point at which Boeing could be making money on the 797 depends on the size market — and the market for larger sized single aisle aircraft appears to be growing every year.

         • @TransWorld

           Yes, it has carbon fiber wing.

           https://leehamnews.com/2019/05/03/bjorns-corner-bombardier-selling-off-unique-cseries-technology/

         • 5% may be the higher price the airlines are thinking about, but ask Bombardier about making money and selling your all new plane at a price and a volume that makes money.
           For the investment involved and likely development costs – remember those are on top of production costs- even Boeing has struggled with the financial engineering.
           You just cant sell it for 5% more than an A321 , whats even their price anyway as they are part of the entire A320 production chain.
           B797 doesnt have that advantage and never will.

         • @Dukeofurl

           A larger 797-10 (i.e. slightly larger than the 752) would certainly have a price premium over the A321neo. In contrast to a stretched A321neo (A322), the 797-10 would very likely not be as “underwinged” as the A321, so it would be harder for Airbus to compete in this market segment without a re-winged A322.

         • @TransWorld

           The main “issue” with the A220 wing is the production rate.

           Worth mentioning as well are the wings for the single-aisle Airbus A220, which bridge the infusion/autoclave gap. The A220 was developed by Bombardier as the CSeries aircraft, until the program was sold to Airbus in late 2017, and then renamed in 2018. The A220 features infused wings that are subsequently autoclave-consolidated at Bombardier Aerostructures and Engineering Services in Belfast, Northern Ireland. The A220 wings use Teijin’s TENAX carbon fiber; Teijin (Tokyo, Japan) and Bombardier in early 2019 signed a contract extension for the wings through 2025.

           –

           Because the largest question mark surrounding large-structure infusion revolves around rate, it is reasonable to look more closely at the process and assess its viability as a high-volume fabrication process. Everyone interviewed for this report notes that as impressive as the MS-21 and A220 are, they still represent low-volume use of infused structures. Getting the process to the next level is within reach, but it will an expensive, arduous reach.

           https://www.compositesworld.com/blog/post/large-high-volume-infused-composite-structures-on-the-aerospace-horizon

       • The point is not just to get something out there that can be easily countered by Airbus. Any NSA would need a Carbon wing with a folding wingtip to get the aspect ratio. If Boeing does an all AL NSA Airbus will 1) spend a week laughing, 2) slap a new carbon wing on the A321 and keep laughing. Even some business jets now have carbon wings. There is just not that much more efficiency you can get by cleaning up the fuselage.

         As for 4 years, Embraer, no slouch, just finished the KC-390. It was kicked off 2010 with expected EIS 2015. I think EIS just happened. That was a relatively conservative design. Mostly AL and off the shelf engines. A220 took 8 years with one year lost to an engine explosion. A350 took 7 years.

         4 years, never.

         Reply

         • The aft fuselage of the C-390 is composite(HITCO in Socal and Denel Saab), as well as things like rudder and flaps( Aernnova)
           https://www.compositesworld.com/news/hitco-wins-contract-with-denel-saab
           The A400M wing is composite and even the C-17 had a composite empennage from about LN70 or so. The interesting part of that is the horizontal tail is about the span of 737 wing….. yes ..who knows?

         • @jbeeko

           As I’ve repeatedly indicated, 4 years is very doable for an aluminium 797. Just repeating over and over again that it is not possible to develop the 797 (NSA) in 4 years, doesn’t really mean anything, although it’s true that repetition makes a fact seem more true, regardless of whether it is or not.

           If Boeing goes ahead with an all aluminium 797 (NSA), Airbus can’t just put a composite wing on the A320neo. Hence, all of your assumptions go out the window with the single-aisle replacements to the 737 MAX and A320neo. The manufacture of composite parts and structures for these new planes at the anticipated rate of 100/month is not feasible using current autoclave cure technology.

           Therefore, new single-aisle aircraft made primarily out of composites will almost certainly have to employ out-of-autoclave (OOA) materials and processes that deliver dramatically shorter part cycle times. These technologies include thermoplastic composites, resin infusion and resin transfer molding (RTM), but they are still only being pursued through a variety of research and development programmes designed to bring maturity to a technology readiness level (TRL) that allows for commercial deployment.

           Conclusion: Don’t expect an all new composite single aisle aircraft to EIS until the mid 2030s

           –

           There is no doubt that composites have earned their way into aerospace structure, as evidenced by The Boeing Co.’s (Chicago, IL, US) and Airbus’ (Toulouse, France) leap to composite wing and fuselage structures in the 787 and the A350 XWB, respectively. But recent questions about whether those same composites could be practical replacements for the thin aluminum fuselage skins found on aging narrowbody, single-aisle aircraft, such as Boeing’s 737 and the Airbus A320, have helped revive interest in already certified hybrid materials called fiber-metal laminates (FMLs) that combine metal and composite products and are designed to take advantage of the best qualities of each material class.

           https://www.compositesworld.com/articles/fiber-metal-laminates-in-the-spotlight

           –

           A few more links:

           https://aluminiuminsider.com/aluminium-lithium-alloys-fight-back/

           https://www.idtechex.com/fr/research-article/advanced-aluminium-alloys-are-set-to-take-off/13710

   • “What Boeing could do, on the other hand, is to aggressively develop a new single aisle family in four years; developed on an “accelerated schedule” while using all of the necessary resources available within the Boeing company (i.e. sufficient key personnel etc.)”

     “More manpower added to a late project makes it later.” ( TMMM )
     The thing Boeing did not get right is “where to spent the effort.”
     Which should have been “up front” and shoot the PR guys first. Invest in careful interface design ( between modules! )

     But where should Boeing get the budget for a New Design with the(ir) skies falling all around them. Scrapping MAX as a product is “priceless”.

     Reply

     • IMJ, a 797 developed — along the lines that I’ve outlined above — could be developed for as “little” as $10 billion. They should also spend a couple of billions on the industrial set-up in order to rapidly increase production.

       They are set to lose $20 billion (plus) on the MAX.

       So, $32 billion (plus) in total — that’s not much worse than what they’ve spent on the 787.

       In contrast to the 787, though, the 797 would have a massive market potential and be more than competitive with the A32neo and/or a third generation A320, from 2025 onwards — and Boeing is in need of an A321neo/XLR competitor sooner rather than later.

       Reply

       • That is pretty standard number for a new aircraft.

         I am not sure of the relevancy of it.

         I would like to see it but there is significant disagreement on NMA or has this morphed into a 737RS?

         Reply

       • OK I’ve done some research.
         Boeing has developed a large aircraft and delivered 4000 in 6 years. The superfortress did need a total war economy though and huge risks were taken.

         Reply

       • Are you assuming that Airbus will be sitting still during this proposed development? Satisfaction and quality-of -workforce issues will enter in, too, for the two companies
         and their suppliers. (See KC-46)

         Reply

   • Is your thinking truly that Boeing, in its present state, is in a position to produce anything like the plane that you propose, in anything like four years?

     If so, I have a beautiful, beautiful, bridge for sale..

     PS: Hint to Boeing: treat your workforce well, and they’ll remember it positively (cf engineer and machinist layoffs).

     Reply

     • @Bill7

       Yes, I believe Boeing has sufficient in-house talent that would be eager to demonstrate to the world that they are, in fact, capable of designing and producing a top-notch, state-of-the-art, single aisle product in four years — that is, if Boeing’s top management would give them the chance…

       Reply

8. Very disappointed by the quality of these analysts job.
   Only Credit Suisse did a serious estimate of the recent events impact on key Financial figures.
   All the other guys just repeat what anyone can read in newspapers.
   no Added value….
   And every month they earn more money than most of us in 6 months.

   Reply

   • Only Credit Suisse even mentioned the 777X program.

     Reply

     • They also moved a potential RTS to beyond August ?

       Reply

9. Are they going to do test flights before they have a signed off on computer system?
   Critical path must be something like, approved fix, test flights, approved training, and then get the training done. What is an estimate from approved fix to approved test flights, two months? What if there are issues in the test flights, then six months?

   Reply

   • No, there will be computer concurrence before flight as will any other issues.

     Reply

   • Ted, Boeing has tested extensively for their own development purposes. The final software version will not be available until after the audit. The audit itself will likely produce some issues to resolve.

     At that point I suspect both EASA and Boeing will do their own non-certification testing for the final software version. Boeing will want to check that the regulations are being met, and will also want to see the results from EASA looking at the JATR questions.

     Then if all these things line up, Boeing will submit the MAX for formal certification testing. It’s not clear if FAA and EASA will do joint certification testing. or if other regulators will want to be joined. If not that may take longer. So still a lot of unknowns ahead.

     Reply

     • Rob,
       the audit was asked for months ago and IIRC EASA scheduled flight testing for this week. How can they schedule flight testing if the audit isn’t finished and issues not fixed?

       Reply

       • Leon, that report came out of PTI in India, but was not verified by other news outlets. So I don’t know whether EASA has tests scheduled or not. As far as I know the audit is still on-going.

         Reply

10. Given the backlog of ~400 completed aircraft and 100+ fuselages from Spirit Aerospace, and assuming deliveries start about July 1 and ramp up fairly quickly to 70-80 per month, production of completed aircraft seems unlikely to start before mid to late 3rd quarter, and for Spirit, about a quarter later.

    Reply

    • I suspect as Boeing clears the ones acualy delivered and then starts to eat into the surplus, they will engage the line at a low level (5-10 a month) to get the supply chain going again and see if there are issues.

      They will be looking at not only the initial no delivered rate, but what the ramp up is forecast (initial will be slower, once they get it sorted out the rate will increase)

      As they were at rate 52 when this started, they should be able to deliver rate 40 in short order (unknown how the line output gets handled but I suspect those sub in for some of the parked ones).

      Its going to be an interesting operation to watch.

      Reply

    • I suspect that we are not understanding the difficulty of restarting. All pilots need to be retrained on simulators, airlines need to rethink how they can handle training and at what rate, the aircraft delivered and grounded need correction, upgrading etc, clients have cash flow to consider. At the beginning I though Boeing was smart continuing to manufacture frames. However I now suspect that they are an ongoing burden. Certainly no 70 per month deliveries.

      Reply

      • I think that is why June is realistic.

        Restarting the line vs training and other aspects is a different thing though.

        Clearly Boeing feels they can re-start as they will not have to make materials change on the MAX.

        Reply

11. One thing really puzzles me. It is reported that both American and Southwest, and others I think, have reached settlements with Boeing over compensation.

    But how could they reach settlements before the loss is known ?

    Maybe the settlements are really in the form of an calculation, with certain payments to be made immediately as defined in the agreement. But even that would be difficult if the final parameters are not known.

    Another possibility is that the settlements only cover certain losses to date, but I don’t think Boeing would agree to that if the settlements didn’t limit some future potential claims. I suspect these agreements are anything but simple.

    Another possibility is that the settlements put a moratorium on any potential court actions between the airlines and Boeing, so Boeing pays out some money but gets to focus on more pressing issues for a while.

    Maybe there has been discussion on these issues, but I haven’t seen it.

    Reply

12. The NY times did a story about the THY 737 NG crash at Amsterdam and how Boeing was able to push back on part of the crash analysis which involved a single sensor which was faulty which led to part of the automation ( autothrottle) overriding the pilots pushing the thrust levers as they were coming into land. Same old same old Pilots manuals not explaining system in detail.
    Boeing got their version into the accident report which was that the ‘pilots should be able to quickly diagnose the problem and take proper corrective action’ Well the Captain did take corrective action but unfortunately wasnt ‘instantaneous enough’ and coming into land with throttles at idle they ran out of height and crashed short of the runway.

    For some reason NY Times has quickly moved the story from its ‘business page’ so its not shown easily even 1 day after publishing . I was told about it because it was syndicated in a local paper, but you wouldnt notice it otherwise in online versions, only with google search.
    https://www.nytimes.com/2020/01/20/business/boeing-737-accidents.html

    Reply

    • I’ve read it. Good analysis. And good memorandum to blamed dead pilots of TK1951.

      And of course in response Dutch Safety Board refuted all. How could be different? :/

      Reply

      • Far from the first time Boeing has pushed this kind of stuff off.

        Two 737s crashed with rudder issue and a number went into varying degree of contro0l upsets.

        Lauda Air was the same.

        NTSB wants Boeing to correct the FLCH issue.

        What is needed is a change in the FAA from cheerleader to regulatory.

        Reply

    • The story is based on a interview with a researcher, professor from Australia, who was tasked with doing the investigation into human resources after the crash. He was hired by the dutch authorities. Reading the crash report last year I was surprized by the similarities too. Specially the single point of failure design, confusing / incorrect emergency warning system, and the effective buying tine / play public sentiments diverting tactics aferwards.. btw the researcher was also a 737 pilot.

      Reply

    • Very naughty.

      Reply

13. Boeing just announced they are not going to cut dividends…because they have the capacity to do so. Also, that they will resume production before the return to service.

    The board decision putting Calhoun in charge this year is now officially the biggest mistake they have made to date. Wow…

    https://www.reuters.com/article/us-boeing-737max/boeing-ceo-expects-to-resume-737-max-production-before-mid-year-idUSKBN1ZL2MA

    Reply

14. Boeing CEO Dave Calhoun said the company will pay dividends to investors “unless something dramatic changes.”

    https://www.cnbc.com/2020/01/22/boeing-ceo-says-it-will-keep-paying-its-dividend-despite-max-crisis.html

    Well…I guess if the Boeing CEO doesn’t see stopping 737 production as a “Dramatic Change”, then perhaps I shouldn’t either. Keep those dividends flowing!

    Oh yeah….and go borrow some money, too. Ya’ need to borrow money when you don’t build airplanes yet pass out dividends:

    https://arstechnica.com/tech-policy/2020/01/boeing-seeks-10-billion-in-loans-as-737-max-crisis-continues/

    Reply

    • The 737 isnt the only plane that Boeing builds, and they do a lot more than just commercial aviation.- so no, they havent stopped making planes.
      Shareholders have to have dividends as thats the ‘rule’ for a very large industrial company like that, and interest rates are at very very low levels.

      Reply

    • The worst thing that can happen to Boeing is that their shareholders walk away, and that their market cap is halved. Reduces your power to get loans or get cash in via emissions tremendously. That is why they keep on paying dividends. Not sure if this is a good sign.

      Reply

15. “Boeing’s projections have lost credibility.”

    Who is responsible at Boeing for financial projections? Is that the role of the Chief Financial Officer?

    Also, who is the rocket scientist at Boeing responsible for the continuation of the dividend payment?

    Reply

16. Reporting this evening is that Calhoun has said that MAX production will restart in April at a lower rate, so as to get the line running and support suppliers. Supplier ordering will begin before that. No layoffs.

    Also said that other aircraft development is on hold so they can get their existing aircraft programs into shape. But the NMA will be a clean-sheet design moving forward.

    Reply

    • Afraid the common view is that after 3-4 years of considering and studying the 797 NMA is shelved, not a ‘clean-sheet design moving forward’. No competition for the A321 XLR for the next decade. https://simpleflying.com/the-boeing-797-nma-is-going-back-to-the-drawing-boards/
      https://www.reuters.com/article/us-boeing-737max-nma-idUSKBN1ZL2RM

      Reply

      • atflyer, from the article link you gave. Existing designs are shelved. Clean sheet means starting anew. That would make sense as the existing design ideas haven’t gone anywhere over the last decade. It also makes sense to re-examine the market.

        “We’re going to start with a clean sheet of paper again; I’m looking forward to that,” Calhoun said. He also spoke of a fresh approach to the market.

        A Boeing spokesman said Calhoun had ordered up a new study on what kind of aircraft was needed. New aircraft typically take 6-7 years or more to bring to market once a decision is made, though Boeing aims to shorten that in part through digital technology and new business models designed around the NMA.

        Reply

        • >though Boeing aims to shorten that in part through digital technology and new business models designed around the NMA.

          Should be fine; never been tried before. /s

          Reply

          • Yes, Rob, I know that people on this board have been tough on you and Scott rightly remarked that should not happen at some point. We have Boeing fans and Airbus fans here on this forum but the discussion should always be done with respect for the position and arguments of the other. I personally have a background as a scientist and hence tend to analyse things. Before the Max disaster I really thought Boeing had the upper hand – 10 Bio profit on 100 Bio turnover with Airbus 2-4 Bio; with the 787 really operationalising breaktrough technologies while the A350 was more conservative; leaner production and much less complex logistics; moving to full life cycle business models trying to use after sales services as additional profit centre, and so on. Only bringing the 787 to production looked bad. But now it appears to be one big mess. A grounding of over 1 year of a product that brings in say up to 50% of profit and turnover, that is probably unprecedented in the global manufacturing industry over the last 100 years of history? What I do not understand is that whatever bad looking message comes out, is that you try to find an argument that turns it into something good. They studied the 797 for about 3 years with dozens, if not 100s of people. How can it be argued that going back to ‘clean sheet’ is not an enormous loss of time? And given the spin we have seen from Boeing last years, shouldn’t we count with it that it is not simply a nice looking story that must hide they shelved the whole idea? Let us assume they study again 2 years, then need an optimistic 6 years to get it into production – the A321 has flooded the low side of the market by the end 2020s, and Airbus most likely has a response in its sleeve (by then the probably must have a follow up of the A330). Indeed, how can ‘new business models’ even shorten this time to market for an airplane?

          • @atflyer
            “with the 787 really operationalising breakthrough technologies while the A350 was more conservative;”

            Look beyond PR. A lot of the boasting is about “duh simple : best solution” that are wrong.
            ( H. L. Mencken : There is always an easy solution to every human problem—neat plausible and wrong 🙂

            And IMU some 787 breakthrough tech was COTSified on the A380 🙂

            We’ll see if Boeing does a second design using barrel sections. non cylindrical cfrp sections were established tech and made sense.

          • atFlyer, I was only pointing out what Calhoun actually said, and what I believe his intent was. I understood what he was trying to accomplish, and why. As I said, I would have those same goals at this point. I wasn’t trying to imply other viewpoints here are wrong.

            Others here think it’s only a PR stunt, but that may be a cynical view. There is an element of PR in that he is the figurehead that represents Boeing to the world. But he also has to make decisions, and I think he is signaling how he wants to proceed. He seems calmer and more open and introspective than Mullenberg.

            Whether or not he can do those things is another question. I believe Boeing has the resources to restart the MAX production line and preserve the supply chain. So that seems reasonable. I would do the same.

            On the NMA, I’ve withheld comment on that debate because many of you here have much greater insight. I would only say, in general terms, that Boeing’s indecision on the NMA is partly due to lack of clarity in the market. Obviously the breadth of opinions offered here, are an indicator of that. There is no single obvious slam-dunk solution.

            In that market, the smaller, less expensive aircraft are going to be favored (A320 and 737). So that leads to successive iterations of the same basic aircraft, as we’ve seen. Airbus has the advantage on that because their base platform is far newer. Boeing is on the tail end of what can be done with the 737 (some would argue already over the line).

            So in that environment, what do you do? First thing is to try to get a better read on the market. That may or may not work as the market may not know itself. But Calhoun wants to try.

            Then the choice is, do you produce a new aircraft but of the same basic design? That might give you an edge on Airbus, but it will be limited by the nature of not being much different, and Airbus will be able to counter it within the same A320 generation, probably more quickly.

            Or do you try to step out ahead with a much different design, which would clearly separate you from Airbus? Boeing tried that with the 787 but Airbus caught up pretty quickly with the A350. There’s a cost of flying in front and it’s easier to fly behind.

            So that is the dilemma, and is made more difficult by the fact that the market can change more quickly than the development time of the aircraft. That’s why Calhoun mentioned speeding up that process.

            The military has this same dilemma, but their solution is concurrency, they build and deploy at low rates while new technology is developed and refined. Obviously commercial aircraft can’t do that.

            So I don’t know what will happen, but I think Calhoun’s approach of the clean sheet is also what I would do at this point. See what the market might be in 10 years, see what innovation is reasonable and possible in a new design over that time, then make the best decision you can. One thing you know for sure, you can’t stand still.

        • Me thinks Calhoun is spewing BS.

          While its extremely important that the aircraft be flyable there is noting in current 787 or A220 or A350 that says they are not.

          It does not take an all new design to fix the automation issues.

          That is nothign more than software issues.

          His whole statement is a weird form of Pablum for the press

          Reply

          • Yep, I’m also critical about what said Calhoun, both new airframe development (what’s wrong with current one? not even strted or what?), or restarting production (why pausing production for 3 months?). I think is other itineration of Boeing’s PR, not so sturdy as in Muilenburg’s time.

    • All I ever heard from Boeing was the NMA was a twin aisle, and the request for engines of 50K, creeping to 52K. Then you had Jon Ostrower who thought it was a CFRP circular top/ovoid bottom fuselage. So if all that was gospel, and it’s out the window, what is the new NMA? Single aisle? Al fuselage? 40K engines?
      I always thought they should come in at A321 capability plus 15% to 20%. 52K engines with one would imagine a big wing was more like 50% to 100% of an A321, a 150t to 200t aircraft. Too big, IMO.

      Reply

    • Um.. that’s *not* what Calhoun said. He said “..as soon as April..”; nothing like the same thing.

      https://www.washingtonpost.com/business/2020/01/22/boeing-has-been-our-own-worst-enemy-missed-deadlines-737-max-ceo-says-he-just-set-new-one/

      We’ll watch, and see.

      Reply

      • Adding: Any bets on the 737MAX being back in production in April, as CEO Calhoun has implied here, without stating it directly? “As soon as April” does not at all = “in April”.

        Boeing’s management’s always been straightforward, after all..

        Reply

    • >Reporting this evening is that Calhoun has said that MAX production will restart in April at a lower rate..

      That’s *not* what Calhoun said. Care for a link?

      Reply

      • Direct quotes from Calhoun, from article in FlightGlobal:

        “Boeing intends to restart 737 Max production several months before midyear and ahead of the Max’s return to service, meaning production could start humming again within three months, Boeing chief executive David Calhoun says on 22 January.

        “Production will start… months before that moment in June, because we have to get that line started up again,” Calhoun tells reporters on 22 January.

        By “moment in June”, Calhoun seemingly refers to
        Boeing’s mid-year projection for certification of the long-grounded 737 Max.

        “And the supply chain will be reinvigorated even before that,” Calhoun adds. “We are going to slowly, steadily bring our production rate up a few months before the… middle of the year.”

        Calhoun adds that production could start within three months and insists Boeing has no plans to lay off workers.

        Reply

        • “could” doing a lot of work in that sentence, IMO.
          The sun “could” not rise tomorrow morning, too..

          Will take it under advisement.

          Reply

    • “Rob January 22, 2020 Reporting this evening is that Calhoun has said that MAX production will restart in April at a lower rate”

      Where did new Boeing CEO Calhoun say that? The Calhoun quote I saw was “as soon as April” which- as we both know- is a *much slipperier* statement, based on Boeing’s previous 737 MAX timelines..

      Reply

      • April is the implied month. January plus 3 months = April. June minus 2 months = April.

        It makes sense as Boeing must sustain the supply chain. or risk losing elements of it. So they will need to buy the parts regardless, and they are not laying people off, so they have the labor force to assemble them.

        Time will tell, but this is what I would also try to do in his place. It adds some certainty to a situation that badly needs it.

        Reply

17. Re: Bernstein Research’s Analysis: Are they serious? I thought Boeing had a head in the sand mentality.

    They were surprised and things for them are unclear?!

    Berstein Research has merely parroted Boeing’s positive reports without being the least bit sceptical about the Information they were receiving.

    Berstein Research should actually have been doing that: Research. I am surprised People any earn anything by delivering such an Analysis.

    Reply

18. Maybe Boeing needs an additional partner, investor for an FSA.

    Reply

    • Maybe Embraer should invest in Boeing, not vice versa

      Reply

      • First why would you want to?

        I mean at some point the gravy train has to end.

        Maybe Embraer should buy Boeing?

        Reply

19. You can estimate your current losses, then you have a discussion.

    Nothing more complicated than that.

    They will have 2020 losses that Boeing will pay some sort of compensation for as well.

    Of course Boeing is still paying a dividend (or plans to)

    Don’t you pay dividends when you have profits?

    My head hurts. Share buy back, borrow money so you can pay dividends, if this is not insanitiy I don’t know what is.

    Reply

    • TW, the loan is due to the impact of the MAX crisis on Boeing’s cash flow. They need to replace lost liquidity until the produced aircraft are delivered. They would not withhold shareholder dividends just for lack of liquidity.

      In terms of the bottom line, the value of the produced & stored aircraft remains in inventory as an asset until delivery, and they already have assured customers, so they are not an actual loss, accounting-wise.

      Also the charge that was taken on the expense of storing them, and other losses due to compensation and settlements, are accrued as tax write-offs that can be used in past/future years that were/are more profitable.

      This year was not profitable so no need to use them at present. But they will be valuable in other years, so they represent a kind of asset as well. Boeing had a net positive tax rate for last few years, so that money will likely be refunded now.

      Corporations can use losses indefinitely to offset future tax burdens, and also apply them retroactively to more profitable years to get a refund. This is one reason corporations can sustain years of negative income and subsequently recover quickly in better years. It’s also why they can report profits to shareholders in years with actual losses.

      For example, the 787 losses created a negative tax rate (refunds) for Boeing for about 15 years, saving roughly $1.5B per year. In 2003, they got roughly $2B refunded from backward applications of those losses, so that year they saved about $3.5B.

      You can see that with these kinds of numbers, the $6B write-down is not such a big deal, they will get it back eventually. This is also one reason why Boeing stock, while taking a hit, has not completely tanked. Analysts know they will bank their losses to increase profits in past and/or future years.

      Reply

      • “They would not withhold shareholder dividends just for lack of liquidity.”

        @Rob, I disagree, you do exactly opposite – if you don’t have liquidity, you withold dividends, not borrowing money instead. Not paid dividend is free money, a loan – a burden with lots of interests. So Boeing this way confirms is a PR / Wall Street driven company, not economics driven one.

        I agree @TransWorld – insanity.

        Reply

        • dividends are “profits distributed to share holders ( the owner community )”

          for cosmetic reasons this is deviated from to give an impression of strength. ( For Boeing this is the second layer of lipsticking profits. The first layer is pushing cost to the right via deferred cost bookkeeping instrument.)

          Reply

          • Guys, a large percentage of business loans are related to liquidity and cash flow. The purpose of a liquidity loan is to maintain business practices in the short term. That’s also the main purpose of a line of business credit.

            If the shareholders are owed dividends based on profit, then you have to pay them, just like you have to pay salaries. There is latitude with respect to the calculation of payment, unlike salaries.

            Boeing could not get this loan unless they could show a good case for it. The lending institutions also make money from it. Liquidity can be viewed as another link of the supply chain, it’s a necessary cost of doing business

            If you can manufacture liquidity in-house, in the form of cash flow, then obviously you do. But there are periods when you can’t.

          • @Rob

            “If the shareholders are owed dividends based on profit, then you have to pay them”

            You don’t have to pay dividend even if company gains profit. There is no such obligation. Company pay dividend if doesn’t need the profit money. Lots of times annual profit is used to finance development, or to secure liquidity. Boeing is in a strong need of huge money – 10 bln USD. It’s a Wall Street insanity to pay any dividend in such circumstances.

          • Pablo, that’s your opinion and as such is fine. I’m only pointing out how business is routinely conducted. Stocks pay dividends and stockholders invest for that reason. So you cannot just not pay them, any more than you could not pay interest on a loan.

            As I mentioned, the amount to pay them is subject to calculation based on many factors. Also the loan, as I told you, is for liquidity, it’s not to add resources that Boeing doesn’t have, it just temporarily converts those resources to cash, by using them as collateral. Boeing would have that cash if the MAX were not grounded. So right now there is a temporary excess of inventory and shortage of cash on hand.

            The loan fixes that at the expense of interest on the loan. But it’s well worthwhile. The alternative would be to sit on billions of dollars of inventory and run out of cash. That would damage the company for absolutely no reason. No competent manager would stand by and let that happen.

          • @Rob

            “Stocks pay dividends and stockholders invest for that reason. So you cannot just not pay them, any more than you could not pay interest on a loan.”

            Economically driven company would never give away a free money as dividend, if were in a strong need od big money as Boeing. What you present as a law (which is not) applies to normal, healthy companies in normal circumstances. I understand that for you paying a dividend in an Olimpus of company well doing, which is not. It’s not only my opinion as you wished see.

            And you are so wrong if you equals dividend with loan. There is no legal obligation to pay dividend, but always have legal obligation to pay a loan. That’s a huge difference, but you don’t think that.

          • Pablo, paying dividends is an expected obligation when you sell stock, legally required or not. That’s why people invest. And it is legally required for preferred stock.

            Boeing is acting in good conscience to manage its assets well. I don’t know what else to tell you. This is yet a another discussion that ends in refusal to accept the facts that are presented.

          • “Stocks pay dividends and stockholders invest for that reason. So you cannot just not pay them, any more than you could not pay interest on a loan.”

            Rob,

            Are you some kind of troll?

          • @Rob

            “This is yet a another discussion that ends in refusal to accept the facts that are presented.”

            You don’t present facts, Rob. You present own ideas and at the end call them “facts”. Don’t lament, maybe simply your arguments are just weak and fishy?

          • Pablo, you’re welcome to take a basic course in business finance, if you don’t believe what I’ve said here. The concepts are well known and well understood. The business world runs on them.

            You’re obviously very unhappy that the shareholders are being paid a dividend. You’re entitled to that opinion.

20. Almost makes one wonder why such sweetheart accounting arrangements are not available to we-the-hoi-polloi; along
    with bespoke lobbyists, lawyers, PR persons…

    Reply

    • Bill, in the US private persons can do this (income averaging) but for a limited time, 5 years if memory serves. For corporations, it used to be 10 to 20 years but as of 2017 Trump tax package, is indefinite.

      The idea is that corporations need to be able to weather downturns and remain stable, as they are the primary employers. But of course it can be used for other, non-intended benefits as well.

      If Boeing uses this to avoid production layoffs, or to continue purchasing from the supply chain, that is the intended benefit. If it maintains shareholder payouts, that is also a benefit but maybe the beneficiaries are far fewer in number. If there are large numbers of employee stakeholders, or retirement holdings, then it’s more justifiable.

      Reply

21. )V-999: “As I’ve repeatedly indicated, 4 years is very doable for an aluminium 797. Just repeating over and over again that it is not possible to develop the 797 (NSA) in 4 years, doesn’t really mean anything, although it’s true that repetition makes a fact seem more true, regardless of whether it is or not.”

    That’s an assertion without evidence, I think, OV-999.

    The 737MAX- far from a truly new aircraft- was announced
    in late August 2011, and first delivery was in May 2017.
    Close to six years for a hot-rodding of the 737, and somehow
    Boeing’s going to build a clean-sheet 797 in 48 months, in
    their present cash and manpower-deprived state, while still
    dealing with the MAX situation?

    Hmm..

    Reply

22. A couple of interesting takes on Boeing and its accounting methods- one fairly recent, and one from 2016:

    https://accountingweekly.com/program-accounting-improves-boeings-profit-picture/

    https://mattstoller.substack.com/p/the-coming-boeing-bailout

    Reply

23. Dickson called airlines today to let them know the FAA has no timeline for RTS, but that Calhoun’s estimate of mid-year was conservative, and it could happen earlier than that.

    Also said the FAA was pleased with Boeing progress in recent weeks. That’s a sign that things are progressing toward RTS.

    Reply

24. Bloomberg- ‘Boeing Mulls Another Cut to 787 Output in New Threat to Cash’:

    https://www.bloomberg.com/news/articles/2020-01-24/boeing-weighs-another-cut-to-787-output-in-new-threat-to-cash

    Reply

25. Wolf Street: ‘After Blowing $43 Bn on Share-Buybacks in 6 Years, Boeing Scrambles to Borrow $10 Bn, on Top of a $9.5 Bn Credit Line in Oct, to Fund its 737 MAX Fiasco’ -now updated:

    https://wolfstreet.com/2020/01/20/after-blowing-43-bn-on-share-buybacks-in-6-years-boeing-scrambles-to-borrow-10-bn-on-top-of-the-9-5-bn-credit-line-it-got-in-oct-to-fund-the-surging-costs-of-its-737-max-fiasco/

    Reply