Implications of heightened scrutiny on Boeing

One of the strategies adopted by Boeing to mitigate aspects from its high-profile scrutiny, is reshuffling of executives in its commercial airplanes business, as it increases its focus on responding to the snow-balling situation.

With U.S. lawmakers calling on Boeing Co’s executives to testify on the two crashed 737 MAX planes, pressure on airplane making is rising steadily even as Boeing, the world’s biggest planemaker is working to return the grounded fleet to the skies.

In what is the first time a U.S. congressional committee has called Boeing’s executives to appear before it for questioning over the crashes, a Senate panel has scheduled a hearing at an unspecified date.

This panel, the Senate Commerce subcommittee on aviation and space, is also slated to question FAA officials on March 27, on why the regulator agreed to certify the MAX planes in March 2017 without requiring extensive additional training.

The development comes in the wake of a Lion Air accident that killed all 189 passengers and crew onboard in November 2018 and the Ethiopian Airlines crash on March 10 that killed all 157 on board. Both of these crashes have set off the widest investigations in aviation history.

According to initial reports from investigators, there are clear similarities between the crash. However, a direct link between the two has yet to be established. At the heart of the U.S. investigation is the MCAS flight control software and related pilot training.

U.S. lawmakers are questioning the Federal Aviation Administration’s certification of MAX’s safety.

On its part, Boeing has promised a swift update to the MCAS, as well as the installation of new software and related training on a priority basis.

On Wednesday, a pilot union of MAX’s biggest customer, the Southwest Airlines Co, stated, extra computer-based training will be required after the software update. Its comments come after it previewed Boeing’s proposed training, which includes a required test, which would be mandatory for Southwest pilots who fly the 737 MAX.

Boeing’s spokeswoman stated, training on the software update would be provided; she declined to disclose further details.

Regulators in Europe and Canada have said, they will seek their own guarantees of the MAX’s safety.

LAWSUITS

On Wednesday, Boeing was sued in federal court in Chicago by the estate of one of the Lion Air crash victims in which the plaintiffs referred to the Ethiopian crash to support a wrongful death claim against the company.

Boeing’s spokesman said the company does not respond to, or comment on, questions concerning legal matters.

As per a report from the Seattle Times, the Federal Bureau of Investigation has joined the investigation into the MAX’s certification.

A spokeswoman for the FBI in Seattle stated, the agency would neither confirm nor deny that it was a part of any investigation.

CNN, citing sources briefed on the matter, has reported that criminal prosecutors at the U.S. Justice Department are also investigating the FAA’s oversight of Boeing; they have also issued multiple subpoenas to Boeing.

As per a report from Bloomberg, U.S. officials have begun their investigating into FAA’s approval of the MAX software linked to the Lion Air plane crash last year within weeks after the accident.

The Pentagon Inspector General stated, it would investigate a complaint that Acting U.S. Secretary of Defense Patrick Shanahan, who is a former Boeing executive, violated ethical rules by allegedly promoting Boeing while in office.

Following the crashes, more than 350 MAX aircraft have been grounded; deliveries of around 5,000 MAX, worth more than $500 billion, are on hold.

Shares of Boeing have fallen by 11% since the Ethiopian Airlines crash, and has wiped out $26 billion from its market capitalization.



Categories: Creativity, Entrepreneurship, HR & Organization, Regulations & Legal, Strategy

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: