Boeing Faces Turbulence

Over the past year, Boeing stock has lost 6.3% of its value. In contrast, its competitor, in a market that is pretty much a duopoly, has gained 45.6%. This divergent performance reflects various negative developments and challenges that Boeing has had to deal with since early 2019.

The first incident was related to Lion Air Flight 610 on October 29, 2018. The investigators then suspected that the MAX’s new Maneuvering Characteristics Augmentation System (MCAS), which was omitted from flight manuals and crew training, automatically and repeatedly forced the aircraft to nosedive. Boeing started to redesign MCAS. In December 2018, studies by the FAA and Boeing concluded that MCAS posed an unacceptable safety risk.

Next, on March 10, 2019, Ethiopian Airlines Flight 302, a Boeing 737 MAX 8 aircraft, crashed and killed all 157 people aboard. This crashed despite the crew’s attempt to use the recovery procedure.

Boeing 737 MAX jets were grounded by aviation authorities around the world the same day!

Flash forward 2020, while Boeing continues to fix its teething problems and obtain regulatory clearances there have been some significant revelations in the media this week.

Striking internal messages released this week by Boeing Co. have undercut many of the plane maker’s defenses of its design and marketing decisions for the beleaguered 737 MAX jet.

Contrary to the company’s public stance, the messages show significant gaps in training required by MAX pilots, cutting operational costs and attempts to avoid regulatory scrutiny of the plane’s automated flight-control system.

The newly released messages contain a rather provocative language. One message from a Boeing employee reads:

“Would you put your family on a Max simulator trained aircraft? I wouldn’t.”

Another message from a Boeing employee reads:

“The airplane is designed by clowns who are supervised by monkeys.”

Boeing is under scrutiny on various fronts and faces a deluge of lawsuits from the victims’ families. It has suspended production of the MAX and hurting companies and their employees across the aerospace industry.

It needs to be seen how Boeing deals with these ongoing revelations while working on the fundamental problems with its business.