Leeham News and Analysis
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Culture key to latest Boeing MAX crisis: panelists
By Scott Hamilton
Special Coverage of the Boeing crisis
Jan. 24, 2024, © Leeham News: What began as a non-fatal accident with an Alaska Airlines 737 MAX 9 on Jan. 5 has blown into a full crisis for Boeing. The company was once considered the gold standard of commercial aviation.
Today, 171 737-9s remain grounded in the US by the Federal Aviation Administration (FAA). There is no end in sight as the FAA and National Transportation Safety Board (NTSB) investigate the accident of Flight 1282 in which a door plug (an inactive emergency exit) blew off the 10 week old Alaska MAX 9 on climb out from Portland (OR).
It is the second time the MAX has been grounded. All MAX 8s and MAX 9s were grounded from March 2019 for 21 months. This grounding only affects the MAX 9.
Evidence points to Boeing quality assurance flaws in final assembly. An anonymous Boeing employee posted on LNA a detailed scenario how Boeing failed its own processes in final assembly of the Alaska plane. (His post follows this article.)
The FAA is booting more inspectors on the ground at the 737 Renton factory. On Jan. 24, Boeing shut down the 737 assembly line for a “safety stand down.” CEOs of Alaska and United airlines, the two US carriers with the 171 MAX 9s on the ground, publicly eviscerated Boeing.
Related Articles
- Errors at Boeing (Seattle Times)
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At the first aviation conference following the Alaska incident, the Aviation Week suppliers event, some speakers called for leadership changes at Boeing.
Pontifications: Boeing turns to US Navy Admiral for second time in MAX crises
Special Coverage of the Boeing crisis
Jan. 23, 2024, © Leeham News: When in trouble, Boeing turned to a retired US Navy Admiral for the second time.
By Scott Hamilton
Last week, CEO David Calhoun announced that Adm. Kirkland Donald was named as special advisor to Calhoun. “Donald and a team of outside experts will conduct a thorough assessment of Boeing’s quality management system for commercial airplanes, including quality programs and practices in Boeing manufacturing facilities and its oversight of commercial supplier quality,” Boeing said in a statement.
It’s the second time Boeing turned to an admiral in connection with 737 MAX crises. In September 2019, the company turned to one of its Board of Directors members, Adm. Edmund Giambastiani, to head a new board-level safety committee to review a plethora of safety items in Boeing Commercial Airplanes. Then-CEO Dennis Muilenburg asked the Board the previous April to establish a Board committee to review Boeing’s safety practices and recommend next steps.
At the time, the MAX had been grounded for six months, with no end in sight. (Another year and two months would pass before the Federal Aviation Administration recertified the MAX.)
Donald and Giambastiani came from the nuclear navy, where safety measures are among the world’s best. Since the creation of the nuclear navy, there have been only two instances where ships were lost—and neither of them was directly related to nuclear power.
The submarine USS Thresher was lost on a test dive in 1963. The submarine USS Scorpion was lost in 1968. The Thresher’s loss was traced to disastrous flooding at a depth from which the sub could not overcome the flooding to surface. The Scorpion’s loss remains controversial to this day. Some believe it was sunk during the Cold War by a Soviet submarine. Others believe a torpedo suffered a “hot run” accident in the torpedo room and blew up before it could be disarmed.
Certifications of MAX 7 and 10 may take hit from 737-9 grounding
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By Scott Hamilton
Jan. 22, 2024, © Leeham News: The grounding of the Boeing 737-9 MAX is likely to delay certification of the 737-7 and 737-10, customers fear.
At a minimum, certification of the 737-7 is likely to shift by months, customers suggest. Certification of the MAX 7 has been repeatedly shifting. Boeing hoped that certification would be achieved in 2022 or 2023. It’s now 2024. In December, Boeing asked the Federal Aviation Administration (FAA) for an exemption to safety standards for a deicing of the leading edge of the composite engine nacelle. There already was opposition from some pilot unions to this request. Now, with the Jan. 5 grounding of the MAX 9 due to the Alaska Airlines Flight 1282 decompression, some believe this exemption won’t be granted.
Flight testing for the MAX 7 is all but done. Boeing hoped to deliver the first MAX 7s to launch customer Southwest Airlines this year.
Flight testing for the MAX 10 is in its early stages. Certification processes were suspended during the MAX grounding, which ended in November 2020. Testing has been slow since because there are only a few MAX 10s available for testing, and due to the slow certification process for the MAX 7. One MAX 10 customer fears certification will be delayed 6-12 months. This would shift deliveries from early 2025 to later in the year or into 2026.
“Unplanned” removal, installation inspection procedure at Boeing
By the Leeham News Team
Jan. 15, 2024, © Leeham News: It’s not supposed to happen.
The door plug on the Boeing 737-9 MAX isn’t supposed to separate from the airplane in flight, as it did on Alaska Airlines Flight 1282 on Jan. 5 this year.
There is conflicting reporting whether the emergency exit or door plug is opened on the Boeing 737 final assembly line for access to the interior. Examining Google images, two photos show the exit or plug closed while over-wing exits are open. Credit: Unknown.
The investigation by the National Transportation Safety Board (NTSB) is in its infancy. Early evidence suggests four bolts intended to prevent the door plug from shifting in its attachment brackets either failed or weren’t installed. Inspections after the 1282 incident by Alaska, and United Airlines found loose bolts in other MAX 9s. The Federal Aviation Administration (FAA) on Jan. 6 grounded the 171 MAX 9s operated by the two carriers until inspections and repairs, if needed, are completed.
This photo of a Boeing 737-900ER for Turkish Airlines shows a door plug closed on the 737 final assembly line. The over-wing exits are open. Credit: Unknown.
Boeing CEO David Calhoun, while telling CNBC that he wasn’t pointing fingers, did precisely that. He said Spirit AeroSystems had a “quality escape,” adding that Boeing failed to catch it, so it also had a quality escape.
How could this happen? The NTSB probe will presumably figure this out. Spirit ships the 737-9 fuselages with the door plug installed. Conflicting reporting suggests that Spirit is supposed to install the door plugs in the final, secure condition; or these are shipped with the plugs in place but in a condition that Boeing would later secure. The NTSB will sort this out, too.
Regardless, Boeing should have inspected the door plugs and assured these are in final condition prior to delivery. The Seattle Times reported on Jan. 14 that contrary to other reports, Boeing doesn’t open or remove the door plug when the MAX 9 is in final assembly. A retired Boeing safety employee with assembly line experience says Spirit ships the door plugs in a temporary condition, expecting that Boeing may remove them during final assembly.
FAA boosts oversight of Boeing; undelivered MAX 9s have discrepancies
By the Leeham News Team
Jan. 12, 2024, © Leeham News: The Federal Aviation Administration today announced it is boosting its oversight of Boeing production and manufacturing on the 737-9 MAX.
The FAA’s been overseeing Boeing deliveries of the MAX since recertifying the airplane in November 2020. Following the discovery of production issues of the 787 in October 2020 that resulted in Boeing suspending delivery for more than a year, the FAA also assumed certification by an FAA official.
With today’s announcement, the FAA said it will add “new and significant actions to immediately increase oversight” to audit the MAX 9 production line and its suppliers to “evaluate Boeng’s compliance with its approved quality procedures.
The FAA also will increase monitoring of MAX 9 in-service events and assess the safety risks of delegated authority. The full announcement is below.
737 incidents prompt new scrutiny at Boeing
By the Leeham News Team
Analysis
Jan. 8, 2024, © Leeham News: Following in the footsteps of the 737 rudder bolt omission inspection just last month, we have the Jan. 5 incident on Alaska Airlines Flight 1282 in which an emergency exit plug door blew off the airplane at 16,500 ft. This may indicate another quality assurance failure at either Boeing or Spirit AeroSystems.
The door plug design used on the Boeing 737-900/900ER, 737-8-200 and 737-9. Credit: Boeing, via the National Transportation Safety Board.
We don’t know if this is a Boeing problem, a Spirit problem, a bolt manufacturer problem, or an Alaska Airlines problem. It’s way too soon in the investigation to draw conclusions. Certainly, because it’s Boeing’s name on the airplane, and especially given the MAX history, people are jumping to the conclusion that Boeing screwed up again. While this may ultimately prove true, LNA is not at all prepared to conclude today that this is the case.
Illustration of the bolt locations securing the Boeing 737-9 door plug to the airframe. Credit: Capt. Chris Brady.
The flight left Portland (OR) for Ontario (CA) about 4:30pm. Six minutes later, as the two-month-old Boeing 737 MAX 9 was climbing through 16,500 ft to cruising altitude, the inactive emergency exit plug door, aft of the wing on the left side of the plane, separated from the aircraft. Decompression followed, with an emergency descent and landing back at Portland. There were no serious injuries.
The area where the door plug and cell phones fell from Alaska Airlines Flight 1282. Credit: Google Earth, NTSB.
Boeing and Spirit have been plagued in recent years by quality “escapes.” Inspection and quality assurance may be the culprit again. The official investigation will take some time. The rapid issuance of the Emergency AD Note mandating only a one time inspection is a logical response to something having been misassembled, with the fix being to verify it is assembled per drawing. Whether this is another piece of poor workmanship not being caught by inspection remains to be seen.
The following analysis was compiled by LNA’s news team.
Spirit Focused on Delivering On Time and At Quality
By Dan Catchpole
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Nov. 6, 2023, © Leeham News: Spirit Aerosystems’ new CEO Pat Shanahan’s focus right now is “to restore confidence in the company” with its biggest customers—Airbus and Boeing.
During a Nov. 1st conference call discussing the company’s third quarter earnings, Shanahan said, “I recognize we have disappointed our stakeholders.”
Shanahan just came on as chief executive in October to help turn around Spirit, which has been flailing, along with much of the aerospace supply chain. Boeing and Airbus will be watching Shanahan’s progress. He gained a reputation as Mr. Fix-It during his time at Boeing.
Summary
- Market responds favorably to latest earnings report and management’s promises.
- Shanahan says Spirit is on track to deliver more than 50 737 MAX airframes in 2025.
- Goal is zero-quality issues.
Boeing Cuts 737 Delivery Estimate in Blood Red 3Q Earnings Report
By Dan Catchpole
October 25, 2023, © Leeham News: Boeing slashed its 737 MAX delivery forecast for the year to between 375 and 400 in its third quarter earnings report on Wednesday. The company attributed the cut to rework and inspections to fix manufacturing problems in aft pressure bulkhead sections produced by beleaguered supplier Spirit AeroSystems. It maintained its 787 delivery forecast of 70 to 80 airplanes by year’s end.
Boeing recorded a loss of $1.6bn in the third quarter, its worst quarterly performance this year. The company continues to struggle with supply chain and production problems. Boeing’s defense division spilled the most red ink on the ledger book due to problems on its Air Force One (VC-25B) program and losses on a satellite contract. BDS recorded a $924mn loss. Boeing executives acknowledged that the company’s recovery is taking longer than they had expected, but they remained upbeat about stabilizing the aerospace giant in the next couple years.
Summary:
- Boeing reports worst quarterly earnings since 3Q in 2022, when it recorded $3.3bn in losses.
- Boeing Defense, Space and Security recorded a $428mn loss on its Air Force One (VC-25B) program and a $315 million loss on a satellite contract.
- The company continues to struggle with supply chain problems and slower-than-expected rework on the 737 program.
- Boeing CEO says losses are a sign of the company’s commitment to a transparent culture and uncovering, rather than ignoring, problems.
Q3 Could Be Boeing’s Reddest Earnings Report This Year
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By Dan Catchpole
The U.S. Air Force accepted the first of five T-7A Red Hawk test aircraft from Boeing on Sep. 14th. (Image courtesy of USAF and Boeing Co.)
October 23, 2023, © Leeham News: Wall Street analysts expect Boeing to post its biggest quarterly loss of the year when it reports its third quarter earnings on Wednesday. The company’s commercial and defense divisions continue to struggle with rework, slow work, supply chain snafus, and other challenges for both its commercial and defense and space divisions. Those divisions’ losses likely will be offset somewhat by Boeing Global Services, which continues to be a bright spot on the company’s otherwise blood-red ledger book.
Analysts aren’t expecting any big surprises, just more of the same financial dark clouds that have been camped out over Boeing in recent years. They expect Boeing to announce a loss due to well-known challenges, especially with its 737 and 787 programs, as well as ongoing struggles within Boeing Defense, Space and Security. In recent research notes, investment analysts have forecast BDS posting a loss between $475m and $500m for the quarter.
Across Boeing’s divisions, Wall Street expects the company to book more than $1bn in losses. Projections vary by as much as $1bn. At the low end, TD Cowen expects a loss of just under $900m. At the other end, Bernstein projects about $1.85bn in losses. In either case, that would be the biggest loss since 2022’s third quarter, when Boeing posted a $3.3bn loss.
Summary:
- BCA continues to struggle with the 737 and 787 programs. It just announced a price revision deal on those programs with airframe supplier Spirit AeroSystems.
- BDS is expected to post more charges due to ongoing struggles with new and mature programs.
Analysis: With Gentile out at Spirit, here’s what Shanahan’s hiring likely means
By Bryan Corliss
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Oct. 2, 2023, © Leeham News – Tom Gentile is out as CEO of Spirit AeroSystems, the victim of a number of serious production missteps and a failure to lead the Tier 1 supplier into a stronger position following the Covid-19 pandemic and the grounding of Boeing’s 737 MAX.
Interim Spirit AeroSystems CEO Pat Shanahan.
The new interim CEO is Pat Shanahan, a long-time Boeing and Pentagon executive who has been serving on Spirit’s board since 2021.
Spirit said its board is conducting a search for a new chief executive.
- Markets respond to news
- Shanahan faces huge challenges as CEO
- Shanahan’s resume fits Spirit’s need
- Our takeaway: What this means for Spirit’s future
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