Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
US transportation secretary Pete Buttigieg has said no grounded Boeing Max aircraft would return to service until they are safe as the plane maker’s chief executive disclosed that the blowout on a flight operated by Alaska Airlines was the consequence of a “quality escape”.
Buttigieg said on Wednesday that there was no timeline for grounded 737 Max 9s to resume flight. He added he spoke to Boeing chief executive Dave Calhoun and told him the company must establish 100 per cent confidence in its planes.
The jet that lost a section of its fuselage in flight last week was the result of a “quality escape”, Calhoun told CNBC — using industry jargon for a manufacturing mistake.
“Mistake” is the word the chief executive used a day earlier speaking at a company-wide safety meeting at Boeing’s factory in Renton, Washington, where it builds the 737 Max. The meeting was broadcast to employees worldwide but closed to the media.
“We’re going to approach this, number one, acknowledging our mistake,” Calhoun said, according to excerpts shared by the company. “We are going to work with the [National Transportation Safety Board] who is investigating the accident itself to find out what the cause is . . . I trust every step they take.”
Boeing has been under intense pressure after a 737 Max 9 plane operated by Alaska Airlines lost a piece of its fuselage at an altitude of about 16,000 feet above Oregon last Friday. Footage shot by people on board showed a gaping hole next to a row of seats.
While there were no serious injuries among the 171 passengers and six crew, Calhoun said all he could think about was “whoever was supposed to be in the seat next to that hole” when he saw the images.
“I’ve got kids, I’ve got grandkids and so do you,” he said. “This stuff matters. Every detail matters.” Boeing’s stock has fallen more than 9 per cent since the incident.
The US Federal Aviation Administration grounded 171 Boeing 737 Max 9s on Saturday. The door panel that blew out during the Alaska Airlines flight was later found in the garden of an Oregon physics teacher.
United Airlines and Alaska Airlines on Monday found bolts in the plugged doors of some of their Max 9s that needed tightening.
Boeing issued instructions to airlines on how to inspect the door inserts on their other Max 9s, but the FAA on Tuesday said those technical instructions were only “the initial version” and were being revised “because of feedback”.
“The safety of the flying public, not speed, will determine the timeline for returning the Boeing 737-9 Max to service,” the FAA said.
Boeing is in “a very anxious moment” with its customers that requires corporate transparency “to make sure they understand that every airplane that Boeing has its name on that’s in the sky is in fact safe”, Calhoun said.
The NTSB is still investigating the accident, and no cause has been determined. But the incident is shining an uncomfortable spotlight on Boeing and one of its biggest suppliers, Spirit AeroSystems, which makes fuselages for the 737 Max.
Spirit is a defendant in a securities lawsuit, refiled last month, that accuses the company of hiding quality lapses from investors.
Court filings include an ethics complaint made by an employee who said a manager demoted him after he refused to under-report the number of defects discovered in Spirit’s products. The manager, the employee said, was “retaliating towards me for trying to do the right thing”.
Spirit declined to comment.
Boeing overhauled its safety reporting structure beginning in September 2019 after two fatal crashes of 737 Max aircraft in 2018 and 2019. After a review by the board, Boeing created a board-level aerospace safety committee and centralised its safety reporting functions.
Top engineers among business units who previously reported to executives leading those divisions began reporting to the company’s chief engineer, who reported directly to the CEO. The company asked Greg Hyslop, then the chief engineer, to move from Chicago to Seattle to be closer to Boeing’s commercial plane factories.
Boeing created a product and services safety group, also reporting to the chief engineer, and appointed Beth Pasztor, the safety, security and compliance vice-president for Boeing’s commercial plane business, to lead it. Two years later it named Mike Delaney, a vice-president overseeing the digital transformation of Boeing’s production lines, to the newly created role of chief safety officer.
Delaney is the only person within Boeing who can give the go-ahead for a fleet with a safety issue to operate again, Calhoun said.
Boeing made the right moves with its safety reorganisation, said Morningstar analyst Nicolas Owens. But he added it was possible the disruption caused by the pandemic undercut the potential benefit.
“It’s fair to say that, coming up on four years, fixing the Max has not been achieved,” Owens said. “The root cause is some kind of corner-cutting or process lapses that seem to be persistent. Even if [the lapses are] totally separate, you can’t say that every Max leaving the factory floor is good to go.”