The crisis at Boeing was explained

This week, Boeing pulled off the unimaginable by devolving even further into crisis.

A whistleblower’s allegations regarding Boeing’s purportedly seriously defective 787 Dreamliner manufacturing process were routinely disregarded by the company, further aggravating an already terrible start to 2024. According to the whistleblower, Boeing punished him by placing him on the 777 aircraft in retaliation. At that point, he claims to have discovered even more production issues.

Boeing says it is confident in the safety of its aircraft and vehemently disputes the allegations. Even so, the US Federal Aviation Administration (FAA) declared that it would look into the matter, adding to the increasing number of federal investigations, including a criminal investigation, into the troubled company. Additionally, testimony regarding the whistleblower’s case will be heard by a Senate subcommittee next week, which is likely to expose more of Boeing’s unethical behavior.

The last thing that the airline, as well as the flying public, need right now is more accusations of lacking safety regulations. Boeing already has a poor public image due to its poor safety record and high-paid executives who disregard quality standards. The whistleblower complaint is making matters worse.

However, Boeing’s bad news seems to go on forever.

The allegations made by the whistleblower.

Sam Salehpour, a whistleblower who worked for Boeing, claimed that the company cut corners when building the 777 and 787 Dreamliners, omitting important safety procedures that could cause the aircraft to fail catastrophically as they age. The planes are expected to last up to 50 years in service, but the shortcuts could drastically cut that time. The whistleblower’s allegations were first published by The New York Times.

His official FAA complaint, which was made public on Tuesday after being filed in January, wasn’t wholly original; the agency had previously looked into Boeing’s 787 production issues and put a stop to 787 deliveries. However, Salehpour’s grievance illuminated a fresh angle on how the 787 Dreamliner assembly teams seemingly neglected to appropriately seal minuscule spaces between independently produced fuselage sections for a thousand aircraft. That might increase joint stress on the aircraft, which Salehpour noted can be challenging to spot during inspections.

He claimed that in order to lessen assembly bottlenecks for the 787, Boeing knew about the process errors and, worse, encouraged them.

The FAA carefully examined Boeing’s manufacturing procedures, which Salehpour questioned, prior to suspending 787 deliveries. Boeing has stated that the aircraft is safe to fly. In March 2023, after it was satisfied that Boeing had resolved the issue, it finally gave the go-ahead for the planes to be shipped to airlines.

In a statement released on Tuesday, Boeing stated that “these claims about the structural integrity of the 787 are inaccurate and do not represent the comprehensive work Boeing has done to ensure the quality and long-term safety of the aircraft.”.

In his new position at the 777 unit, Salehpour claimed to have found poor quality work, with crews misaligning body parts and Boeing pressuring engineers to approve work they had not yet inspected.

Boeing declared in a statement on Wednesday, “We are fully confident in the safety and durability of the 777 family.”. These assertions are false. “.

The journey of Boeing to this point.

The most recent charges are like gasoline added to a dumpster fire.

The company’s once impeccable safety record, according to critics, was damaged by its disastrous 1997 merger with McDonnell Douglas, and things have only gotten worse from then on, with two deadly 737 Max crashes in 2018 and 2019. After being grounded for almost two years, Boeing finally admitted its responsibility for the crashes and stated that a design flaw was to blame.

The last week of 2023 saw the start of the recent unbroken run of bad news when an airline found a possible issue with a critical component on two 737 Max aircraft.

Then, shortly after takeoff on the first weekend of 2024, a portion of an Alaska Airlines 737 Max blew off the side of the aircraft, sending Boeing into crisis mode. According to the National Transportation Safety Board’s preliminary investigation, Boeing most likely did not install the bolts in the so-called door plug, which are meant to keep the component from blowing off the aircraft. Although CEO Dave Calhoun acknowledged the company made a mistake and stated in response to the investigation that Boeing is ultimately responsible, Boeing has not acknowledged the specific accusations in the federal report.

Due to the incident, certain 737 Max aircraft were temporarily grounded nationwide. Congress held hearings, production and delivery delays, numerous federal investigations, including a criminal investigation, and a roughly 30% decline in Boeing’s stock price this year resulted in a nearly $50 billion reduction in the company’s market valuation.

It wasn’t the end of the bad news. The flight controls of a United Airlines 737 Max jammed during the landing in Newark, New Jersey, according to pilots’ reports in February. The FAA reported safety concerns one month ago regarding the de-icing systems on the 737 Max and 787 Dreamliner models, which may result in engines losing thrust. The aircraft are still being allowed to fly by the FAA, and according to Boeing, there is no immediate risk to public safety.

However, FAA Administrator Mike Whitaker stated last month that the agency had discovered problems with “very important” parts of Boeing’s manufacturing and assembly line and had given the company until late May to develop a plan to address its production issues. The FAA had reviewed Boeing’s production workflow and standards.

Boeing stated that it is addressing a number of the problems that Whitaker pointed out.

What Boeing’s future plans are.

Boeing’s leadership has been impacted to the highest levels. The commercial aircraft overseer and the longstanding executive in charge of the 737 Max unit were among the executives let go by the company. In addition, CEO Dave Calhoun announced that he would retire by the end of the year, having received $32,8 million in compensation the previous year and expecting to receive $45 million for his retirement.

Boeing will pay a heavy price for its current issues: airlines essentially stopped ordering aircraft from the company in January, and the only 737 Max aircraft they ordered last month were for the larger, non-pilotable Max 10 model, which is still grounded due to icing problems. The business might also face heavy penalties and protracted legal actions. In order to compensate Alaska Airlines for the temporary grounding of its aircraft due to the door plug blowout, Boeing has already paid the airline over $150 million.

The business hasn’t made a profit in years, and Boeing won’t either this year due to the Alaska Airlines debacle.

However, Boeing is not in imminent danger of dying. In the global production of commercial aircraft, Airbus is the company’s only real rival. Due to their difficulty in switching airplane manufacturers, airlines are shielded from normal market forces such as passenger preference. Although there’s some evidence that angry or nervous flyers prefer Airbus flights, opting for that can be impractical or impossible depending on where they want to travel.

Boeing is ultimately accountable to its customers, shareholders, and regulators, all of whom are becoming increasingly irate with the company every day. Since Boeing’s reputation is already damaged, winning back the trust of airlines and regulators may be challenging. A turnaround is made more difficult by the constant stream of bad news.

Boeing’s upcoming top brass will have their hands full given the impending arrival of new leaders. Additionally, everyone will be watching them.