The Federal Aviation Administration (FAA) gave an update Thursday on its dealings with Boeing and the company’s 737 Max mess. After announcing plans to put more “boots on the ground” at the company’s facilities, the agency revealed that it spent all day meeting with executives to hash out next steps. The result? Boeing has 90 days to come up with a plan to address everything’s that’s been discovered to have led to “systemic quality-control issues.”
Essentially, the government is putting Boeing on a performance improvement plan. The company has to address an FAA production-line audit and the findings of an FAA report released Monday that said investigators couldn’t confirm whether there was a “objective evidence of a foundational commitment to safety” that matched what Boeing said it had.
Wheels down
In January, a Boeing 737 Max 9 operated by Alaska Airlines had to make an emergency landing after a door plug blew out mid-flight. That led to lots of other 737 Max 9 planes getting grounded while Boeing and regulators tried to figure out what was going on.
Bowing to increased scrutiny and skepticism from legislators, the company decided around that time to reverse course on asking for an FAA safety exemption as it dealt with issues on another plane, the 737 Max 7. Senator Tammy Duckworth of Illinois had written a letter upbraiding Boeing for “brazen request to cut corners in rushing yet another 737 Max variant into service.” The revocation and Duckworth’s letter recalled troubles from a few years ago, after two 737 Max 8 planes crashed and Boeing had to deal with the fallout.
Earlier this month, a preliminary National Transportation Safety Board report came to the conclusion that somehow the door plug left a Boeing facility without crucial bolts in place to keep the assembly together in the air.
The stock didn’t go down much at first, but now it’s down more than 20% for the year. French rival Airbus, which told investors earlier this month during an earnings call that it “wanted to take benefit of the current period” and will likely step up its “short-term and very aggressive competition” with Boeing, is taking advantage of the 737 Max turmoil to extend its dominance of the global jetliner market. Ryanair, at least, is hoping to maybe get some cheap planes out of all this.