By the Leeham News Team
Sept. 18, 2022, © Leeham News: LNA last week attended the US Chamber of Commerce’s Aerospace Summit in Washington (DC). We’ll have a series of full reports in the coming weeks. Here are things picked up on the sidelines.
- The Federal Aviation Administration remains “pissed” at Boeing.
- Boeing CEO David Calhoun said certification of the 737 MAX 10 could come this year, but it might not. He expects certification of the MAX 7 to come this year.
- Separately, LNA is told that the MAX 10 probably won’t be certified until next summer, and certification of the MAX 7 could come as early as next month.
- Calhoun said that Boeing is now pausing the 737 production line when parts don’t come in from suppliers. Doing so prevents traveled work. “We’re going to stay here until these lines move. Steadily, steadily, steadily when we’re not getting defects and we’re not getting shortages.”
- Calhoun said the stored airplanes aren’t facing shortages. But getting them delivered is a matter of going through the “conformance” steps. “They sat for a couple of years. There were a lot of deferred actions that were incorporated into the new certification. Every one of those actions must be taken on these return-to-service airplanes. It requires almost as many hours to do that as it did to build one in the first place.”
- Boeing is probably going to be frozen out of China for one-two years, principally in retaliation for the visits by House Speaker Nancy Pelosi and a Congressional committee as well as defense product sales to Taiwan.
- Air Canada and United Airlines promoted their ecoAviation plans with, among other things, orders for the Heart Aviation electric hybrid airplane. Heart abandoned its 19-seat version in favor of a 30-seat model, the ES-30. Air Canada announced an order for 30 the day of the commercial portion of the Chamber’s conference. Air Canada also invested $5m in Heart, it was also announced. United last year placed an order for 100 ES-19s.
Heart Aviation ES-30. Credit: Heart Aviation.
- But neither airline addressed the total life cycle elements of an electric or hybrid airplane. Making, charging, and disposing of batteries is ecologically challenging and offsets some of the gains of the concept.
Return of the conference
This was the first Chamber aviation conference since the beginning of the COVID-19 pandemic in 2020. About 800 people attended. The first day focused on the emerging commercialization of the space market. The second day focused on commercial aviation.
Unfortunately, the agenda did not provide questions and answers following the presentations. This is a major omission.United CEO Scott Kirby fled (or was whisked away) when reporters met him as he left the stage, avoiding questions. So did others, while some speakers engaged with the press. But the audience had do chance to follow up presentations.
Hopefully, this will be included next week.
“Boeing CEO David Calhoun said certification of the 737 MAX 10 could come this year …”
Aren’t flight tests of MAX 10 planned for 2023??
Dave really must think that the aviation press — and the attendant, large group of aviation industry followers — is dumb.
“Boeing CEO David Calhoun said certification of the 737 MAX 10 could come this year …”
– attempting to keep the stock price from dipping
Well his compensation is tied to the stocks he gets so of course he is.
All he has to do is last a few more years and he can exit with his lucre and then its the next guys problem.
“Calhoun said that Boeing is now pausing the 737 production line when parts don’t come in from suppliers. Doing so prevents traveled work. “We’re going to stay here until these lines move. Steadily, steadily, steadily when we’re not getting defects and we’re not getting shortages.””
Meanwhile, revenue inflow reduces and cash burn increases…and available cash is already uncomfortably low.
““They sat for a couple of years. There were a lot of deferred actions that were incorporated into the new certification. Every one of those actions must be taken on these return-to-service airplanes. It requires almost as many hours to do that as it did to build one in the first place.””
So, this basically confirms what we already suspected: margins on whitetails are zero or negative, because of the huge effort required to make them deliverable.
Investors will not be amused by these revelations.
In August, 20 737s made their first flights and 12 in Sept.
“Investors will not be amused by these revelations.”
With the EU being busy committing industrial Seppuku
Boeing’s task is to sit pretty for the time being.
( the current development could quite well turn Airbus completely noncompetitive.)
If/when the cash runs out at BA, the show will be over — unless Uncle Sam steps in with a bailout. With that as an example, Auntie Ursula can then also step in to help Airbus.
Don’t despair yet: European natural gas prices have fallen by 50% in the past 3 weeks, and are still falling. Also, the electricity price is about to be decoupled from the gas price.
price could well be going down because consumers are “folding” their operations.
Prices started to plummet once the market became aware that EU gas storage reserves had hit the 80% mark two months ahead of schedule — they now stand at 85%, and are still rising.
Although lower than in the EU, US natural gas prices are still 3 times higher than normal. Moreover, the strong dollar (due to rising US interest rates) is making US exports expensive, and is cutting into revenue for a wide range of US companies. Accordingly, BA is also feeling economic pain.
The sh*t is really going to hit the fan — for both OEMs — when airline revenue starts to drop, and orders get deferred.
Germany PPI increased by almost 46% in August
NYT: ‘Crippling’ Energy Bills Force Europe’s Factories to Go Dark
“Boeing is probably going to be frozen out of China for one-two years, principally in retaliation for the visits by House Speaker Nancy Pelosi and a Congressional committee as well as defense product sales to Taiwan.”
What happens to Chinese Dreamliner orders that are currently on the books?
Are they being Canceled (penalty-free, due to the delivery delays)?
Does the “freezing out” only refer to new sales, or also to deliveries?
I see 10 on-order frames for various Chinese carriers. It appears that the oldest of them is 2.4 years old, and the youngest is 1 year old.
There is also 1 777-300ER for China Southern Airlines that has been awaiting delivery for more than 2 years. It is effectively the last 777-300ER that will come off the assembly line (the other remaining order for 5 units from PIA is sketchy).
After (largely) clearing out its inventory of built jets, BoA analyst forecasts BA’s FCF to drop by $3b or more a year.
Can Ted Colbert still be the next CEO after being sanctioned??
I wonder why the sensor redundancy and EICAS requirements that are on the table for the 737-10 (&737-7) certification, are not on the table for the 737-8 (& 737NG), if they are the same systems, cockpits.
Concluding the current NG & -8 fleets don’t meet modern requirements, despite being certified by the authorities, should be avoided at all times. Because consequences would be hard to predict.
That’s why China isn’t re-certing the MAX: CAAC condition #3 implicitly requires EICAS. It can be dressed up as a “political” play, but Chinese newspapers clearly stated this condition at the start of 2022, after the CAAC had cleared MCAS modifications; Reuters also published the condition at the time. Either BA didn’t read properly, or was just hoping that the requirement would somehow disappear into thin air.
It seems that BA avoided implementing EICAS so as to please Southwest (less training), but thereby shot itself in the foot with regard to a much bigger market.
Yep, its all nonsense. ECIS has not saved a number of A320 types (or the AF447.
Lack of the ECIS was not a function or a problem in the MAX crashes.
I assume contributors don’t recall the wiring issue on the NG (and earlier) aircraft.
It had to do with what is called an association and possible failure. Boeing was required to correct it on the MAX, but there were no requirements for the NG or earlier though that is where it came from.
It was an interpretation of wiring standards that was technically correct and had proven to have no basis in fact in tens of millions of flight hours.
That is a tough one. There is a base reason for the technical as it applies to all wiring and wire associations for a reason. But it may not have any real world relevancy to a specific situation.
So yes, those demanding that Boeing has to have ECIS are ignoring an existing requirement when the NG and Classics were built. You can only attribute it to Boeing bashing.
ECIS was not intended to be applied to the MAX, it simply fell over an arbitrary line that was intended to apply it to future aircraft.
Not sure what “ECIS” is.
EICAS, on the other hand, has been around for more than 3 decades now, and is implemented on every in-production commercial passenger jet model in the world — with the exception of the archaic MAX.
Time to drag that relic into the modern age: regulators (and legislators) have every right to do so.
Look!..these two engineers (one ex-FAA, one ex-BA) are even spoonfeeding BA and giving the company an easy path to implement an “EICAS lite”:
I had a Kaypro computer for lo many years. All I needed it to do was Word Processing and it had an excellent and easy to use Word Processor program (Wordstar)
In fact, Word is a nightmare as it take years to set it up to do simple word processing. That is the alert system in a nutshell imposed on the MAX-10.
Granted it did not do acronyms !
If it works and does the job, its not archaic.
Imposing a different standard on a system that has alerting functions built into it is indeed bad. (confusion).
Imposing it on some aircraft (MAX-10) and not the rest?
There are words to describe that which are not allowed here.
We have yet to see what the EASA definitively requires in all MAX models — but reference was made to the CAS in the provisional re-cert AD, with a 2-year grace period.
As it currently stands, it seems that the CAAC will be requiring EICAS on all MAX models.
The old BA gamble is unraveling.
I agree with you on the safety of the 737. But I believe that the main issue is not whether or not EICAS is essential for the 737 MAX10, but compliance with a safety standard created by the US Congress after the MAX accidents. Whether the system is necessary or not is not the point; but Boeing cannot fail to comply with a rule created precisely because of accidents involving the MAX.
The problem is you know how many crashes there are but you don’t know how many jets are saved by up-to-date EICAS.
-> NTSB investigators concluded that Boeing underestimated a pilot’s response time to a plane’s nose pitching down. A key assumption, the report found, was that pilots could quickly figure out what was wrong and correct for it *amid multiple and cascading error messages*.
“Thus, the NTSB concludes that aircraft systems that can more clearly and concisely inform pilots of the highest priority actions when multiple flight deck alerts and indications are present would minimize confusion and help pilots respond most effectively,” the report says. In both crashes, the “stick shaker” was activated, which rattles a cockpit’s control columns, in addition to other lights flashing and alert sounds. […]
The report found that “neither Boeing’s system safety assessment nor its simulator tests evaluated *how the combined effect of alerts and indications might impact pilots’ recognition of which procedure(s) to prioritize*.”
NTSB Chairman Robert Sumwalt said in a statement that the crews in the planes did not react in the ways Boeing and federal aviation officials had anticipated.
The incorrect assumptions “were used in the design of the airplane and we have found *a gap between the assumptions used to certify the MAX and the real-world experiences of these crews, where pilots were faced with multiple alarms and alerts at the same time*,” Sumwalt said.
@TW WordStar was fine, but WordPerfect was definitely the application that should have prevailed. But Microsoft Word had connections. And what connections. I had to take my year old laptop into BestBuy this week. I said Microsoft Word just started saving all my files to The Cloud. The Geek Guy played with my keyboard a bit, then looked up at me and said: That’s the way Microsoft wants it! Got to wonder who develops the Operating System used on these planes…
If the FAA will test the MAX 10 in 2023, then is it certain that Congress will extend the deadline for Boeing to certify the aircraft without meeting the new requirements?
The EASA requires a retrofitted third AOA input on all MAX models, and the MAX-10 is the testbed for that.
There are actualy two very seperate aspects to your question.
ECIS was not mandatory for MAX cerfitation, it was part of a reform bill to ensure that moden aircraft met the ECIS standard (desinged in from scratch)
In the case of the MAX-10, you would have to kludge the ECIS on top of the current alerting system (and yes there is an alerting system, its not what is the current mandate)
The other is the third AOA system. This in fact was specific to the re-cert of the MAX. It was waivered as an interim but required for the MAX-10 specifically.
It also was required to be back-fitted to the rest of the MAX series.
What would happen if the MAX-10 is cancelled I do not know.
So its a more complicated issue than some portend.
As the ECIS is a US congressional mandate, its a US specific law.
As its a US law with a deadline, the FAA also has the authority to go to congress and ask for a waiver for that specific application.
Neither the FAA nor congress can stop the AOA, they can the ECIS as its not a joint agreement item with EASA.
My question is exactly with regard to this Law. If the FAA has already scheduled certification tests for the MAX 10 for early 2023, it seems they already know that Congress will grant Boeing an extension of time to certify the aircraft without installing the new requirements.
@ Ricardo Braz
At present, it seems that BA is just ignoring the December deadline, and is assuming that Congress will give a waiver.
It may be in for a nasty surprise.
And it seems to have overlooked the possibility that regulators outside the US will have more stringent requirements.
Just to be clear. The FAA is not ‘pissed’ at Boeing.
The FAA is finally doing the tasks they should’ve been doing all along and holding Boeing accountable.
The FAA is doing their job and includes more oversight on the Boeing ODA personnel who technically report to the FAA.
Aviation safety and program management are still very discombobulated. Worker morale is very poor and this affects quality build.
Nevertheless, the FAA may (for example) be “pissed” over the fact that it still has to babysit BA, and sign off on every MAX and 787 undergoing delivery — a role that expends huge amounts of FAA resources.
It may also be “pissed” over the apparent lack of a proactive attitude by BA when it comes to providing documentation required by certification processes.
Think of a teacher who is exasperated by the class dunce.
Call it what you want to. The FAA is doing oversight like they are sanctioned by Congress to accomplish.
Resource’s are their problem. It’s about time they started doing their job!
I have a very good friend who worked for the FAA in WDC and he was always challenging leadership why they continued to agree to unlimited deviations, exemptions and ELOS requests to deviate from the FAR’s for Boeing. He never got an answer basically because they didn’t understand the safety consequences on approving these requests.
Reading this, I think you’d appreciate the new (Dominic Gates) documentary “Flight/Risk” on Amazon Prime. It doesn’t paint a flattering picture of the FAA — or, of course, of BA.
The FAA is probably pissed off at Boeing management.
Boeing is more than the management though they are the ones that have driven the company into these issues.
The inspectors are most likely trying to do their job as are all the tech people tring to come up with compliance actions despite management causing issues.
The FAA issued a reprimand to Boeing and noted the culture does not get it. Management is sadly used to the corner cutting.
The FAA is finally doing its job.
And despite many repeating the Urban Legend of the FAA as a gold standard, it in the past has not been. The standards were there, what was not was the enforcing of those standards.
At least for now they are being enforced.
Mostly agree with you.
Boeing quality inspection has been reduced ten fold in the name of ‘process improvements’ (lean). Much of the work is self inspected now as they figure the person who installs the widgets knows it best and will report defects and/or the functional test will catch it and of course then create rework.
The FAA has bought off on all this.
I don’t think it is the management that leaves debris in the wings, leaves fasteners out etc.. It’s the people who install the widgets etc., and now they’re policing themselves? Lunatics in charge of the asylum!
AW: Airbus Looks At Broader New-Built Freighter Offering
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Regarding the MAX in China:
Bloomberg: “Boeing Held Talks With China Regulator on 737 Max Comeback”
“Boeing Co. and China’s aviation authority held a meeting on Sept. 14 to evaluate the 737 Max aircraft, which hasn’t been fully approved to return to commercial service in the country despite flying again in most other markets.
“The talks were held in Zhoushan in eastern China, according to CAAC News, the media arm of the Civil Aviation Administration of China. Boeing has a completion and delivery center in Zhoushan, to the south of Shanghai.
“The regulator is expected to release an updated report on the Max after issues raised at the meeting are resolved. That will signal the completion of the process required for the Boeing jet to be reintroduced in China, the CAAC said. No timeline was provided.”
The problems of the Max in China is many fold. It of course started with the two crashes; was not helped by the complications of COVID or the obtuseness of the previous administration… And I presume further complicated by the references in this story to the politics of the day. It will be interesting to read the further reporting on this subject.
Now the timeline is pretty clear.
It seems that Boeing will not have an “easy life” in China. Xiamen Airlines was an exclusive Boeing customer.