Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Teamsters, Boeing have a new contract April 29, 2025
- Boeing wants to remarket China’s airplanes. It’s costly and time consuming. April 28, 2025
- Bjorn’s Corner: Air Transport’s route to 2050. Part 19. April 25, 2025
- How good is the C929? Part 2. April 24, 2025
- Boeing First Quarter Results Update: China is 10% of the backlog, with 500 in “Unidentified” April 24, 2025
FAA, Boeing meet; “They must follow through on corrective actions.” Update 3: Boeing’s issues its statement
Update #3: Boeing released its own press release. Here it is:
Boeing’s plan is based on findings from FAA audits, recommendations from the FAA’s ACSAA panel review and feedback from our employees. This Safety and Quality Plan generally fits into four categories of actions:
- Invest in workforce training
- Simplify plans and processes
- Eliminate defects
- Elevate safety and quality culture
Statement from Dave Calhoun: “After the Jan. 5 accident involving a 737 airplane, we took immediate containment and mitigation actions to ensure airplane safety. We also made the decision to slow production as we took a hard look across every facet of our operations. We listened to our employees, engaged transparently with our regulator, welcomed the findings and recommendations from the FAA’s ACSAA panel review, and invited scrutiny from customers and independent experts. Based on that feedback and oversight, today we presented to the FAA our comprehensive plan to strengthen our safety management, quality system, safety culture and ODA responsibilities.
Many of these actions are underway and our team is committed to executing on each element of the plan. It is through this continuous learning and improvement process that our industry has made commercial aviation the safest mode of transportation. The actions we are taking today will further strengthen that foundation.
We thank Administrator Whitaker and the FAA team for their feedback today and we will continue to work under their oversight as we move forward.”
Statement from Stephanie Pope: “Our plan is built on the feedback of our employees who know best how to design, build and deliver safe, high-quality airplanes. We also incorporated the requirements and feedback from our regulator and welcomed the recommendations from our customers and industry experts.
Based on that feedback, our roadmap includes major investments to expand and enhance workforce training, simplify manufacturing plans and processes, eliminate defects at the source, and elevate our safety and quality culture, along with specific measures to monitor and manage the health of our production system.
We are confident in the plan that we have put forward and are committed to continuously improving. We will work under the FAA’s oversight and uphold our responsibility to the flying public to continue delivering safe, high-quality airplanes. We are also grateful for our customers’ patience as we implement this plan and return to predictable deliveries.”
From: Stephanie Pope
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Update #2: The FAA issued the following press release in the wake of its meeting with Boeing. Boeing is expected to release its own statement today. Additional updates will be made as developments occur.
FAA Continues to Hold Boeing Accountable for Implementing Safety and Production Quality Fixes
Agency meets with company on next steps following submission of their safety roadmap
WASHINGTON – The Federal Aviation Administration (FAA) will continue to hold Boeing accountable after reviewing the company’s roadmap to fix its 
systemic safety and quality-control issues, Administrator Mike Whitaker said Thursday following a three-hour meeting with senior Boeing leaders at FAA headquarters.
In February, Whitaker directed Boeing to develop a comprehensive action plan to set a new standard for safety and how the company does business following the January 5 Alaska Airlines Boeing 737 MAX door plug incident. This roadmap is necessary to reset the safety culture at Boeing, as well as address the findings of the FAA’s special audit and the expert review panel report.
The company has developed this proposal over the last 90 days, with detailed input from the FAA throughout the process. Boeing senior leadership met with the FAA this morning to present the roadmap and discuss future implementation. Boeing is also now required to have a mandatory Safety Management System, which will ensure a structured, repeatable, systematic approach to identify hazards and manage risk.
“In the immediate aftermath of January 5, the FAA took unprecedented steps to increase oversight on Boeing. Over the last 90 days, that has meant everything from more safety inspectors in the facilities to halting production expansion. Today, we reviewed Boeing’s roadmap to set a new standard of safety and underscored that they must follow through on corrective actions and effectively transform their safety culture,” Administrator Whitaker said. “On the FAA’s part, we will make sure they do and that their fixes are effective. This does not mark the end of our increased oversight of Boeing and its suppliers, but it sets a new standard of how Boeing does business.”
Whitaker met Thursday morning with Boeing President and CEO David Calhoun and other senior leaders to discuss next steps to ensure effectiveness.
“I made clear once again that we need to see a strong and unwavering commitment to safety, which must always come first,” Whitaker said. “Systemic change isn’t easy but in this case is absolutely necessary, and the work is never really done when it comes to the safety of the flying public – from Boeing, airlines, or the FAA. But we will hold the company accountable every step of the way to make sure these changes happen.”
The FAA communicated with Boeing officials throughout the last 3 months, including 30- and 60-day check-ins, to ensure they clearly understood the agency’s expectations and were making real-time progress.
The agency required Boeing to provide a detailed update on completed actions as well as mid- and long-term actions Boeing will take. These actions include:
- Strengthening its Safety Management System, including employee safety reporting
- Simplifying processes and procedures and clarifying work instructions
- Enhanced supplier oversight
- Enhanced employee training and communication
- Increased internal audits of production system
Additionally, Boeing had to identify the results of completed actions and how it will monitor those and future actions to validate progress and sustain the changes.
To ensure long-term success, the FAA will actively monitor review Boeing’s progress in a variety of ways, including:
- A team of FAA subject matter experts will continually review Boeing’s progress and the effectiveness of the changes in addressing the audit findings and expert panel recommendations
- Senior FAA leaders will meet with Boeing weekly to review their performance metrics, progress, and any challenges they’re facing in implementing the changes
- They also will conduct monthly reviews to gauge Boeing’s progress
The FAA will continue its enhanced oversight of Boeing and its suppliers. This includes:
- More safety inspectors in the Boeing and Spirit AeroSystems facilities
- More conversations with company employees to gauge the effectiveness of changes
- Additional inspections at critical points of the production process and auditing of the production process
- Monitoring quality system metrics to identify any areas of concern
Additional actions the FAA has taken as part of its aggressive oversight of Boeing and its suppliers include:
- Immediately grounded 171 Boeing 737-9 MAX aircraft operated by U.S. airlines or in U.S. territory.
- Increased onsite safety inspector presence at Boeing’s facility in Renton, Washington, and Spirit AeroSystems’ facility in Wichita, Kansas.
- Halted production expansion of the Boeing 737 MAX.
- Administrator Whitaker visited to Boeing’s factory floor in Renton, Washington, to see the 737 production line and hear directly from Boeing engineers, mechanics, and others about quality control processes. He has actively encouraged all whistleblower complaints, and the FAA investigates every single one.
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- Concluded an audit of Boeing’s production line that went above and beyond FAA’s standard inspection process. The FAA identified non-compliance issues in Boeing’s manufacturing process control, parts handling and storage, and product control. Our audit is complete but it is part of an ongoing investigation, and we cannot release further details.
- The FAA continues to issue airworthiness certificates for every newly produced Boeing 737 MAX.
Original story:
FAA appears poised to grant Boeing extension on safety report; FAA issues denial (Update)
Update #1: The FAA today said it has not granted an extension for Boeing to submit its report. This story will be updated as developments occur.
By the Leeham News Team
May 29, 2024, © Leeham News: The Federal Aviation Administration (FAA) appears poised to give Boeing a 90 day extension on the 90 days required to come up with an actionable plan to improve safety on its production lines, LNA is told.
Then, according to this information, Boeing will be given three years to implement whatever is finally approved by the FAA.
Boeing CEO David Calhoun is scheduled to deliver the 90-day plan to the FAA tomorrow.
LNA reported on April 18, 45 days into the 90-day mandate, that Boeing would unlikely meet the FAA deadline.
Related article
This week Boeing must deliver on safety–again
By the Leeham News Team
Analysis
May 28, 2024, © Leeham News: Boeing’s FAA-mandated plan to improve its safety culture is due this week.
Following the Jan. 5 accident involving Alaska Airlines Flight 1282 and a year-long safety study commissioned by the Federal Aviation Administration (FAA), Boeing was given 90 days to come up with a new plan to improve safety procedures.
Boeing’s been down this path before. Following the 2018/19 crashes of two 737-8 MAXes in which 346 people died, Boeing implemented several safety studies and procedures. Flight 1282 demonstrated a shocking lack of results from the earlier efforts.
The FAA on Feb. 29 gave Boeing 90 days to make a realistic plan for addressing the path forward to an acceptable level of quality. This is an exceptionally tall ask given all that has gone wrong in the recent past. It’s unclear if the FAA will release Boeing’s proposal publicly. But LNA’s reporting team, which includes retired Boeing employees whose duties included safety and production, thinks that whatever plan is put forth to the FAA will all boil down to one point, execution. That’s Boeing’s problem today: Failure to execute its production plan as documented in its operation command media.
Big hurdles for COMAC to become serious challenger to Airbus, Boeing
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By Scott Hamilton
May 27, 2024, © Leeham News: A flurry of orders by China’s Big Three airlines finally began to balance announced deals for the COMAC C-919 mainline jet.
Until the recent orders from Air China, China Eastern, and China Southern, the vast number of the announced transactions were concentrated among Chinese lessors. The imbalance was not a good thing.
Airbus and Boeing prefer speculative orders by lessors amounting to 25% to perhaps 35% of the order book. (Lessors in recent decades often accounted for 40% to 50% of the in-service fleet, but the differences were from sale/leasebacks of orders originally placed by airlines.)
Boeing and Airbus have different views toward lessors. Airbus, especially under then-Chief Commercial Officer John Leahy, viewed lessors as an extension of the Airbus marketing arm. Lessors broadened Airbus’ market penetration, especially during the early years of the A320’s entry into service.
On the other hand, Boeing viewed lessors as a necessary evil, preferring to deal with a select few rather than a large number. Both viewed lessors to some degree as competitors to direct sales.
Before the Big Three orders, COMAC’s tally was around 760+ for the C919. More than 70% of the announced orders were for Chinese lessors. No lessor outside China was a customer and only Indonesia’s Trans Nusa (partly owned by Chinese lessor CALC) was a customer outside China.
Following the Big Three orders, about 46% of the orders are from airlines—a much better mix than before but still overweighted with lessors.
With Airbus’ A320 family sold out into the 2030 decade and Boeing’s MAX production and delivery schedules in disarray, what alternatives do customers have to the Big Two OEMs? COMAC is the most likely, but the challenges are immense.
COMAC’s challenges
COMAC has big challenges ahead if it wants to become a major global player in commercial aviation.
- Gaining credibility for the C919 inside and outside China.
- Economic competitiveness to the A320neo and 737 MAX.
- Ramping up production.
- Global product support.
- Geopolitical concerns.
Bjorn’s Corner: New engine development. Part 9. The role of the Nacelle
By Bjorn Fehrm
May 24, 2024, ©. Leeham News: We do an article series about engine development. The aim is to understand why engine development now has longer timelines than airframe development and carries larger risks of product maturity problems.
To understand why engine development has become a challenging task, we need to understand engine fundamentals and the technologies used for these fundamentals.
In the last Corner, we looked at why Open-Rotor engines have two fan stages, either both rotating in different directions or one rotating followed by a de-swirling stator stage. Now we study the flow field ahead of and around the fans to understand the role of the nacelle and the open rotor spinner.
Figure 1. A graphic showing the different parts of a Pratt & Whitney PW1100G nacelle. Source: Pratt & Whitney.
The all-important cabin. Part 1
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By Bjorn Fehrm
May 23, 2024, © Leeham News: We will do an article series about the all-important cabin and its seating for an airliner. The cabin layout and its comfort are the most important parts of an airliner for the passenger.
Most of the time, the traveler doesn’t know what type of aircraft he is flying on, but he will have a clear understanding of the cabin and whether it meets his expectations.
The cabin is where the airline can expose its branding and set the flight experience for the passenger. It’s thus an area that is updated to new cabin concepts for the fleet more often today than 10 years ago, especially for mainline carriers.
The cabin is also important in evaluating airliners, as the characteristics of the aircraft (fuel consumption, operational costs) are evaluated per seat. OEMs have become experts in maximizing the seating of their aircraft to gain an advantage during an evaluation. Sometimes, in a non-transparent way. We will explain the typical tricks and how to guarantee an apples-to-apples comparison when evaluating airliners.
Summary:
- The cabin and its seats mean different things to a passenger, airline, and evaluation expert.
- We go through the different priorities, and how they affect the end product.
David Calhoun’s first and last addresses to Boeing shareholders have common themes, four years apart
David Calhoun, president and CEO of The Boeing Co.
May 21, 2024, © Leeham News: David Calhoun was named CEO of The Boeing Co. in December 2019. He assumed office in January 2020. He had been on the Board of Directors since 2009. His first annual shareholders meeting as CEO was the 2020 AGM, for the financial year 2019.
When Calhoun was named CEO, the 737 MAX had been grounded for nine months, following the crashes in October 2018 and March 2019 of the Lion Air and Ethiopian Airlines MAX 8s. There was no end in sight for the grounding—which ultimately lasted 21 months.
Three months after Calhoun assumed office, the global COVID-19 pandemic erupted. Global passenger traffic collapsed and so did deliveries of the widebody aircraft prevalent on international routes. Boeing Commercial Airplanes (BCA) revenues and cash flow, already emasculated by the MAX grounding, was put under further strain. Then, in October 2020, Boeing suspended all deliveries of new 787s after finding production flaws. This suspension lasted 20 months.
Following the January 5, 2024, accident involving Alaska Airlines Flight 1282, a 737-9 MAX, Boeing’s safety record which came under fire in 2018-19 was again called into question. Calhoun announced his retirement effective the end of this year. Other Board-level and executive changes were also announced.
The May 17, 2024, Boeing AGM was Calhoun’s last as CEO. His prepared statement was reminiscent of his first as CEO. Some of the themes—notably about safety—expressed last week were eerily similar to those articulated in 2020 during his first address to shareholders.
LNA has assembled Calhoun’s first and last addresses to shareholders. We’ve highlighted common themes between the two addresses, made four years apart.
Southwest, the “legacy LCC,” part 2: Bloated labor expense, difficult fleet strategy result in uncompetitive cost structure
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Now open to all readers.
By Judson Rollins
Introduction
May 20, 2024, © Leeham News: Southwest Airlines was founded on the principles of high employee productivity and low labor costs. But 53 years after beginning operations, its labor cost as a percentage of expenses — and per seat-mile — is now the highest among US airlines.
Boeing 737 MAXes parked after the 2019 MAX grounding. Source: Getty Images via AFP.
LNA studied Southwest’s and its US competitors’ 2023 annual reports to comprehensively understand their relative profitability. The resulting picture is less than flattering to the Dallas-based carrier. Southwest is increasingly a “legacy LCC,” with LCC-like unit revenue but a legacy cost structure.
Summary
- Labor costs are dramatically worse than legacy or LCC competitors.
- Fleet and route strategy are crimped by overreliance on the Boeing 737.
- Southwest’s insular management team and culture may be its greatest obstacle to business model innovation and continued profitability.
Bjorn’s Corner: New engine development. Part 8. Open Rotor technology
By Bjorn Fehrm
May 17, 2024, ©. Leeham News: We do an article series about engine development. The aim is to understand why engine development now has longer timelines than airframe development and carries larger risks of product maturity problems.
To understand why engine development has become a challenging task, we need to understand engine fundamentals and the technologies used for these fundamentals.
In the last Corner, we looked at why Open-Rotor engines are more efficient. Their propulsive efficiency can be considerably higher than that of a turbofan. We will explore this further this week.
Figure 1. A counterrotating Open Rotor design that SAFRAN ground tested in 2019. Source: SAFRAN.
Boeing’s safety, labor battles heat up while CEO will walk with $34m payout
By Scott Hamilton
May 16, 2024, © Leeham News: Even as Boeing is under fire for safety issues, the company’s battles heat up.
- Boeing remains at an impasse with its engineers and technicians union over creating a new safety program. The company has doubled down, the union says. SPEEA has turned to lawyers for legal advice.
- The US Department of Justice on Tuesday notified Boeing that it concluded the company failed to live up to terms of a 2021 Deferred Prosecution Agreement (DPA) intended to put to rest all criminal liabilities stemming from the 2018-19 737 MAX crashes that killed 346 people. DOJ may go ahead with criminal prosecutions now.
- The firefighters union was locked out by Boeing over contract negotiations, bringing in replacement workers. The union says Boeing’s actions threaten safety at its plants. SPEEA and its powerful touch labor union, the IAM 751, are picketing with the firefighters in support.
- IAM 751 apparently is using the firefighters’ strike as a training ground in anticipation of its own possible strike in September when its current contract expires.
A350-1000 or 777-8? Part 2
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By Bjorn Fehrm
May 16, 2024, © Leeham News: We are doing an article series comparing the capabilities of the Airbus A350-1000 and the Boeing 777X. We have looked at the A350-1000 versus the 777-9 and started comparing the history and capabilities of the 777-8 versus the A350-1000 last week.
Now, we use our Aircraft Performance and Cost Model (APCM) to fly the aircraft on a typical route and compare their performance.
Summary:
- The A350-1000 and the latest 777-8 definition is a closer payload-range match than the A350-1000 and 777-9.
- Passenger and cargo capabilities are similar. The economic comparison will be determined by maintenance costs for the engines.