Boeing on campaign to restore confidence in 737 Max
Company to unveil details of software update designed to help pilots more easily avert conditions linked to air disaster in Indonesia
Washington — After two deadly crashes in five months, Boeing is embarking on a campaign to restore confidence in the 737 Max so that its best-selling jet can return to the skies.
In Renton, Washington, the company was gathering customers and news media on Wednesday to walk through the details of a software update designed to help pilots more easily avert conditions that investigators have linked to an October disaster in Indonesia. The stall-prevention software is also under scrutiny in a second deadly crash this month in Ethiopia.
Meanwhile, in Washington DC, the Federal Aviation Administration (FAA) will brief legislators on its oversight of Boeing’s fixes to the 737 Max and how officials plan to scrutinise safety testing more closely in the future.
The dual engagements underscore the high stakes for the US aerospace giant and its chief regulator. Boeing needs to regain trust from customers, passengers and government officials from Washington to Beijing after a crisis that has badly tarnished the revamped version of the 737, its most profitable aircraft programme. The FAA is defending its oversight of the 737 Max’s development and certification, even as it prepares to order safety fixes.
“It was a huge wake-up call for both Boeing and the FAA,’’ said Richard Healing, a former member of the National Transportation Safety Board, who is now a safety consultant. “The question is whether or not they can actually convince everybody that they’ve done it right this time.’’
The global ban on Max flights is weighing on Boeing’s customers. Southwest Airlines, the plane’s largest operator, said the grounding would combine with soft leisure demand to shave $150m from first-quarter revenue.
The aircraft maker has developed an update to the Maneuvering Characteristics Augmentation System (MCAS), according to a company statement on Tuesday.
A preliminary report in 2018 about Lion Air Flight 610 indicated that MCAS forced the nose down repeatedly before the 737 Max 8 plunged into the Java Sea on October 29. The crash killed 189 people.
Boeing submitted a proposed certification plan for the software changes to the FAA on January 21, according to the statement. After trying it out in flight simulators, the company conducted a test flight on February 7. That was followed by a “certification flight with the FAA’’ on March 12, just two days after Ethiopian Airlines Flight 302 crashed near Addis Ababa, killing 157.
Boeing plans a final submission of the MCAS software update by the end of this week.
It is possible the changes will get the 737 Max back in the air within weeks, said aviation consultant Robert Mann. There is a risk that Chicago-based Boeing and the FAA will face a much longer road ahead before the jet, which debuted less than two years ago, can start flying again.
The regulator is reviewing the software updates proposed by Boeing. Officials in China, Canada and the EU — who grounded the plane before the FAA — have signalled that they intend to independently review the changes before restoring flights.
That is a break from historical precedent, in which aviation regulators in other countries typically follow the FAA’s lead and accept its findings, said Peter Goelz, a former MD of the National Transportation Safety Board.
“It may mean that there’s a staggered reintroduction of the aircraft into service,” Goelz said. “The FAA is going to have to embark on a mission to restore its credibility with the other regulatory bodies.”
Putting the plane back in the air involves not just getting the technical details right. Swirling in the background are a probe by federal prosecutors and Congressional hearings, which started on Wednesday in Washington before the Senate’s subcommittee on aviation and space.
Then there is the challenge of winning over a potentially fearful public. Many travellers asked airlines to switch their reservations to planes other than the 737 Max after the Ethiopian Airlines crash and before the jet was grounded.
While Boeing’s software fix appears close to approval by FAA, regulators and the company still need to convince ordinary passengers that it is safe, said Mark Gerchick, a Washington lawyer who previously served as the FAA’s general counsel.
“It has to be pretty definitive,’’ he said. “People have to say, ‘Ah, I get it.’ It’s a question of public confidence.’’
Also looming is the crash investigation in Ethiopia. Investigators have yet to publish a preliminary report. If new facts emerge, they could complicate the plane’s future.
While the 737 Max faces an uncertain outlook, there’s still plenty of enthusiasm on Wall Street for Boeing even after the 12% share decline since the Ethiopian crash.
Citigroup resumed coverage of the company with a buy recommendation. Analyst Jonathan Raviv sketched out a path to $500 from Tuesday’s closing price of $370.38, based on the assumption of a 737 Max grounding that lasts months and ends with “a manageable fix”. But he also warned of a low-probability risk that the shares would fall to as low as $220.
With the software update, Boeing has “an opportunity to reassure the market that this product will be exactly what was promised, with some minor modifications and training procedure changes,’’ said Richard Aboulafia, an aerospace analyst at Teal Group. “But they have to explain it all very carefully and very transparently.”
Boeing developed the 737 Max as an answer to Airbus’s success with the A320neo, an upgraded version of the European planemaker’s workhorse jet. Even in a best-case scenario for Boeing, the 737 Max will be playing catch-up to the Airbus model for a long time to come.
“The programme will survive and it will be a player, but is it the A320neo’s equal?’’ said Aboulafia. “The question of whether it returns to be the A320neo’s equal depends on how they handle this.”