planecane
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 1:05 am

ArgentoSystems wrote:
smartplane wrote:
Comments are in relation to Boeing compensation. There are three elements of OEM compensation. 1. Covered in the contract. Global grounding preventing delivery is FM. 2. Implied / past precedents. 3. Compensation Agreement. Most MAX customers are on CA V.1 or V1.1 to be read in conjunction with the original Sale/Purchase contract. Customers will want / expect V2.0 if the grounding extends beyond the start of 4Q19.


Global grounding is not a force major no matter much mental gymnastic you employ. If I sign a contract with you to deliver me a product with certain characteristics and comes delivery time you find that the item that you wanted to deliver to me is undeliverable due to defects then it is you problem. I don't care how you deal with it. Maybe give me a free upgrade to a better product, or pay whatever fines are specified in contract.

FM is something you can't possibly envision in advance and that allows you to break contract without consequences. Global grounding of MAX will not let anybody get away from the fulfilling their contracts.


You are 100% correct here. FM would be if an earthquake hit Renton and destroyed the tooling. A grounding due to an aircraft being deemed not airworthy is not FM. That is within the control of the manufacturer.
 
MrBretz
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 6:58 am

Regarding possible compensation, you all need to look at airline profit not revenue. Airlines seem to profit anywhere from 5 to 10 percent on their revenue. You might want to look at yahoo finance and examine AAL, DAL, UAL, etc. And someone might make the argument that the routes a 737 operate are the least profitable. The lawyers will have a field day. Maybe BA will compensate them with a free MAX or an extended warranty. Who’s to know?

Let’s get the plane back in the air first.
 
WIederling
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 7:06 am

ArgentoSystems wrote:
FM is something you can't possibly envision in advance and that allows you to break contract without consequences. Global grounding of MAX will not let anybody get away from the fulfilling their contracts.


The groundings following the Iceland volcanic activity introducing large amounts of ashes into the atmosphere
is a case of "Force Majeure". No doubt.

The groundings forced on a product not fit for the certified purpose with the circumstances known and hidden
by the manufacturer are definitely not.
Going by the fall out from Diesel Gate this should lead to not only compensation but also punitive damages levied on Boeing. Isn't that what the US legal system is so fond of? ( or does it only apply to foreign entities? )
Murphy is an optimist
 
AirwayBill
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 7:16 am

WIederling wrote:
ArgentoSystems wrote:
FM is something you can't possibly envision in advance and that allows you to break contract without consequences. Global grounding of MAX will not let anybody get away from the fulfilling their contracts.


The groundings following the Iceland volcanic activity introducing large amounts of ashes into the atmosphere
is a case of "Force Majeure". No doubt.

The groundings forced on a product not fit for the certified purpose with the circumstances known and hidden
by the manufacturer are definitely not.
Going by the fall out from Diesel Gate this should lead to not only compensation but also punitive damages levied on Boeing. Isn't that what the US legal system is so fond of? ( or does it only apply to foreign entities? )


Exactly. There is no case of "force majeure" in the 737 MAX situation.

Force majeure is generally intended to include occurrences beyond the reasonable control of a party, and therefore would not cover:

Any result of the negligence or malfeasance of a party, which has a materially adverse effect on the ability of such party to perform its obligations.


Negligence on behalf of Boeing will be/is already proven, you can be sure of that. Boeing cannot hide.
 
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InsideMan
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 8:21 am

MrBretz wrote:
Regarding possible compensation, you all need to look at airline profit not revenue. Airlines seem to profit anywhere from 5 to 10 percent on their revenue. You might want to look at yahoo finance and examine AAL, DAL, UAL, etc. And someone might make the argument that the routes a 737 operate are the least profitable. The lawyers will have a field day. Maybe BA will compensate them with a free MAX or an extended warranty. Who’s to know?

Let’s get the plane back in the air first.


The only thing that is relevant for liquidated damages is what is written in the contract and/or what is negotiated afterwards.
You have a delivery month and you have to notice the delivery date a certain time ahead of delivery. If you fail to present an airworthy aircraft at said delivery date or you do not notify the delivery date and you slip out the delivery month, you have to pay liquidated damages. Grace period, height, cap all depends on the people negotiating on both sides of the table. If you make money as an airline is irrelevant....

In cases like this obviously Boeings negotiators are working around the clock to agree to new amendments to push back deliveries and limit the damages as much as possible or convert it into cheaper alternatives e.g. free aircraft.
 
sibibom
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 9:19 am

SpiceJet will look for options if 737 Max  issue  isn’t  resolved: CFO Kiran Koteshwar

Airline to wait for another 8 months before taking a call on new purchases, says CFO
The 737 Max planes are unlikely to be ready to carry passengers again until 2020

source : https://www.livemint.com/companies/peop ... 12746.html

ps : Boeing has paid them $20 million last quarter for the MAX grounding.
 
planecane
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 10:07 am

InsideMan wrote:
MrBretz wrote:
Regarding possible compensation, you all need to look at airline profit not revenue. Airlines seem to profit anywhere from 5 to 10 percent on their revenue. You might want to look at yahoo finance and examine AAL, DAL, UAL, etc. And someone might make the argument that the routes a 737 operate are the least profitable. The lawyers will have a field day. Maybe BA will compensate them with a free MAX or an extended warranty. Who’s to know?

Let’s get the plane back in the air first.


The only thing that is relevant for liquidated damages is what is written in the contract and/or what is negotiated afterwards.
You have a delivery month and you have to notice the delivery date a certain time ahead of delivery. If you fail to present an airworthy aircraft at said delivery date or you do not notify the delivery date and you slip out the delivery month, you have to pay liquidated damages. Grace period, height, cap all depends on the people negotiating on both sides of the table. If you make money as an airline is irrelevant....

In cases like this obviously Boeings negotiators are working around the clock to agree to new amendments to push back deliveries and limit the damages as much as possible or convert it into cheaper alternatives e.g. free aircraft.


However, mitigating factors are taken into account (at least in the US). I know that they haven't, but let's say WN leases a used 737-800 to replace an unflyable MAX. Now they are able to make the same revenue but they have a cost for the lease and will use additional fuel vs. the MAX. Boeing would be liable for the additional fuel cost and the lease cost but not any more.
 
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InsideMan
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 10:55 am

planecane wrote:
InsideMan wrote:
MrBretz wrote:
Regarding possible compensation, you all need to look at airline profit not revenue. Airlines seem to profit anywhere from 5 to 10 percent on their revenue. You might want to look at yahoo finance and examine AAL, DAL, UAL, etc. And someone might make the argument that the routes a 737 operate are the least profitable. The lawyers will have a field day. Maybe BA will compensate them with a free MAX or an extended warranty. Who’s to know?

Let’s get the plane back in the air first.


The only thing that is relevant for liquidated damages is what is written in the contract and/or what is negotiated afterwards.
You have a delivery month and you have to notice the delivery date a certain time ahead of delivery. If you fail to present an airworthy aircraft at said delivery date or you do not notify the delivery date and you slip out the delivery month, you have to pay liquidated damages. Grace period, height, cap all depends on the people negotiating on both sides of the table. If you make money as an airline is irrelevant....

In cases like this obviously Boeings negotiators are working around the clock to agree to new amendments to push back deliveries and limit the damages as much as possible or convert it into cheaper alternatives e.g. free aircraft.


However, mitigating factors are taken into account (at least in the US). I know that they haven't, but let's say WN leases a used 737-800 to replace an unflyable MAX. Now they are able to make the same revenue but they have a cost for the lease and will use additional fuel vs. the MAX. Boeing would be liable for the additional fuel cost and the lease cost but not any more.


Nope, sorry but that is simply not true. If WN successfully negotiated that Boeing has to pay 1m US$ for each day of delay with no cap on it, than that is what Boeing has to pay. It doesn't matter what other aircraft WN might use or not use in the interim. It has absolutely no bearing on the purchase agreement. Now, if say Boeing says we will front you NGs for free in the interim as a wet lease an in return we agree that damages will be limited to 1M$ per aircraft or whatever, then that is a different agreement to amend the existing one. But unless WN and Boeing agree on something else other than what is in the orignal purchase agreement, there is nothing to mitigate whatever was previously agreed and signed.
 
XRAYretired
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 11:33 am

News of Lion Air final report expectations, but it appears that the Indonesians are not all on the same page:

https://www.voanews.com/east-asia-pacif ... next-month
'A draft of the report by the transport safety agency (KNKT) will be sent next week to Boeing, Lion Air, the U.S. Federal Aviation Administration and other parties to seek feedback, said Polana Pramesti, director general of civil aviation.
"After getting the responses, KNKT will release it in September," Pramesti told Reuters.'

https://www.vir.com.vn/indonesia-lion-a ... 69857.html
'Nurcahyo Utomo, the National Transportation Safety Committee's lead investigator on the Lion Air crash, said on Friday that the agency is still waiting for data from Boeing.
"When we get that data, it will go into our draft of the final report that we'll send to stakeholders, including Boeing, Lion Air and the US Federal Aviation Administration for feedback," he told AFP.
"I still hope we can release the final report in October."
Earlier Friday, Polana Pramesti, director general of Indonesia's civil aviation agency, had said she expected the report to be released by September.'

Ray
 
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Revelation
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 12:55 pm

WIederling wrote:
ArgentoSystems wrote:
FM is something you can't possibly envision in advance and that allows you to break contract without consequences. Global grounding of MAX will not let anybody get away from the fulfilling their contracts.


The groundings following the Iceland volcanic activity introducing large amounts of ashes into the atmosphere
is a case of "Force Majeure". No doubt.

The groundings forced on a product not fit for the certified purpose with the circumstances known and hidden
by the manufacturer are definitely not.

Again, more outrage, just based on the suggestion that contracts may have provisions in them for global groundings that are in the territory of force majeure?

The poster literally said: "Global grounding is force majeure territory" not "Global grounding is force majeure".

It'd be interesting if anyone would share their knowledge on the contract language, rather than their outrage over something that wasn't actually said.

WIederling wrote:
Going by the fall out from Diesel Gate this should lead to not only compensation but also punitive damages levied on Boeing. Isn't that what the US legal system is so fond of? ( or does it only apply to foreign entities? )

Damages in civil court cases are likely, but we don't have the evidence in hand that would allow us to say they are parallel situations, so it's not yet a fair comparison.

In the case of Diesel Gate, a defeat (cheating) device (actually software patch) was installed to cheat on tests supervised by the regulators, and a VW executive who is now in jail signed a document saying no such defeat device was in use. It was a real easy case to be made.

In the case of 737, Boeing seems to have used authority delegated to itself to self-regulate how MCAS was certified, seems to have largely acted with FAA granting other permissions such as not including MCAS in the training manuals and seems to be able to say mistakes it made were errors in judgement ("we put too much work load on the pilots") rather than outright mistakes.

Time will tell if FBI/DoJ will find a "smoking gun" or not, but as of right now, I don't think one has.
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ArgentoSystems
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 1:28 pm

Revelation wrote:
WIederling wrote:
...

Again, more outrage, just based on the suggestion that contracts may have provisions in them for global groundings that are in the territory of force majeure?

The poster literally said: "Global grounding is force majeure territory" not "Global grounding is force majeure".

Outrage? The word, as defined by the dictionary means "an extremely strong reaction of anger, shock, or indignation.". Please point out specific words that you consider "an extremely strong reactions".

and w/r to
The poster literally said: "Global grounding is force majeure territory" not "Global grounding is force majeure".

I can only :shock: Huh?
 
planecane
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 1:34 pm

InsideMan wrote:
planecane wrote:
InsideMan wrote:

The only thing that is relevant for liquidated damages is what is written in the contract and/or what is negotiated afterwards.
You have a delivery month and you have to notice the delivery date a certain time ahead of delivery. If you fail to present an airworthy aircraft at said delivery date or you do not notify the delivery date and you slip out the delivery month, you have to pay liquidated damages. Grace period, height, cap all depends on the people negotiating on both sides of the table. If you make money as an airline is irrelevant....

In cases like this obviously Boeings negotiators are working around the clock to agree to new amendments to push back deliveries and limit the damages as much as possible or convert it into cheaper alternatives e.g. free aircraft.


However, mitigating factors are taken into account (at least in the US). I know that they haven't, but let's say WN leases a used 737-800 to replace an unflyable MAX. Now they are able to make the same revenue but they have a cost for the lease and will use additional fuel vs. the MAX. Boeing would be liable for the additional fuel cost and the lease cost but not any more.


Nope, sorry but that is simply not true. If WN successfully negotiated that Boeing has to pay 1m US$ for each day of delay with no cap on it, than that is what Boeing has to pay. It doesn't matter what other aircraft WN might use or not use in the interim. It has absolutely no bearing on the purchase agreement. Now, if say Boeing says we will front you NGs for free in the interim as a wet lease an in return we agree that damages will be limited to 1M$ per aircraft or whatever, then that is a different agreement to amend the existing one. But unless WN and Boeing agree on something else other than what is in the orignal purchase agreement, there is nothing to mitigate whatever was previously agreed and signed.


Delivery delay and grounding are two different things. I should have been more clear. Yes, if the contract has delivery delay penalties in it, that would be the compensation for frames not delivered timely.

However, on frames already delivered the mitigating factors would come into play. I'm sure there is a warranty and since all of the MAX frames are pretty new they still fall under it. The warranty will cover the cost of the upgrades and possibly the cost of maintenance while grounded. I doubt the warranty provides specified compensation for days out of service, but it might.

If it does, that will be better for Boeing because the impact of a frame out of service for a few days of a repair is a much lower cost than a whole fleet being out of service. Normal spares limit cancellations from a frame being in the hangar. That's not the case with a grounding.
 
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JerseyFlyer
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 1:49 pm

Revelation wrote:
I find it interesting that even back in March, Peter Lemme was discussing the solution that not just addresses MCAS but also addresses cosmic rays:

A dual channel mandate would require CPU#1 from FCC#1 and CPU#1 form FCC#2 both calculate commands. The active FCC command is valid only if it agrees with the non-active FCC command calculation.

A dual channel mandate could require CPU#2 from FCC#1 and FCC#2 to both calculate commands and to compare that to their CPU#1 command values. A difference by either FCC CPU#2 should raise a flight deck alert.

The Mach trim, Speed trim, and MCAS commands should probably be inhibited while only one sensor or one FCC is available. In each case, pilot awareness of the loss of augmentation may be the safest course of action.

Ref: https://www.satcom.guru/2018/11/737-fcc ... mmand.html


I don't know how easy it will be to integrate these developments into the production of new frames, but is is certainly going to be much more of a headache to retrofit the hundreds of frames already delivered / built.
 
ShamrockBoi330
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 3:49 pm

Air Lease using this opportunity to switch 15 Max 8/9 orders to 5 789

As of 30 June 2019, Air Lease had outstanding orders for 150 737 Max aircraft, but it has signed a memorandum of understanding with Boeing to switch 15 of these to a deal for five 787-9s.

https://www.flightglobal.com/news/artic ... ax-460230/
 
asdf
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 5:13 pm

InsideMan wrote:
Nope, sorry but that is simply not true. If WN successfully negotiated that Boeing has to pay 1m US$ for each day of delay with no cap on it, than that is what Boeing has to pay. It doesn't matter what other aircraft WN might use or not use in the interim.


This may be in regard to a delay of delivery
But they deliver!

Because of the grounding BA may be liable for payment
but it lies in the responsibility of the airlines to prove how big is their financial harm

so it does matter what other aircraft WN might use or not use in the interim
because this has an influence on their financial disadvantage
 
asdf
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 5:15 pm

XRAYretired wrote:
'Nurcahyo Utomo, the National Transportation Safety Committee's lead investigator on the Lion Air crash, said on Friday that the agency is still waiting for data from Boeing."


what data could be that the manufacturer for almost a year does not deliver
 
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PW100
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 5:52 pm

smartplane wrote:
oschkosch wrote:
Honestly? If you don't know what force majeure is, then it is better you don't write such a comment as above. It's probably the the most untruthful statement I have read in this thread.

The definition of force majeure is:
Force majeure refers to unanticipated, uncontrollable events such as acts of nature (ie. hurricanes or floods) or acts of people (ie. riots or wars).

. . .
MCAS failure is NOTHING to do with force majeure.


If not such tragedy, MCAS would be a Farce Majeure . . .
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par13del
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 6:38 pm

asdf wrote:
XRAYretired wrote:
'Nurcahyo Utomo, the National Transportation Safety Committee's lead investigator on the Lion Air crash, said on Friday that the agency is still waiting for data from Boeing."


what data could be that the manufacturer for almost a year does not deliver

Why do you assume it is a year?
It can very well be an additional request generated as a result of what they want to release in their initial report, in which case, they probably gave Boeing a heads up.
 
Checklist787
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Mon Aug 12, 2019 9:24 pm

PW100 wrote:
If not such tragedy, MCAS would be a Farce Majeure . . .


It's funny :lol:
 
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InsideMan
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 7:41 am

planecane wrote:
InsideMan wrote:
planecane wrote:

However, mitigating factors are taken into account (at least in the US). I know that they haven't, but let's say WN leases a used 737-800 to replace an unflyable MAX. Now they are able to make the same revenue but they have a cost for the lease and will use additional fuel vs. the MAX. Boeing would be liable for the additional fuel cost and the lease cost but not any more.


Nope, sorry but that is simply not true. If WN successfully negotiated that Boeing has to pay 1m US$ for each day of delay with no cap on it, than that is what Boeing has to pay. It doesn't matter what other aircraft WN might use or not use in the interim. It has absolutely no bearing on the purchase agreement. Now, if say Boeing says we will front you NGs for free in the interim as a wet lease an in return we agree that damages will be limited to 1M$ per aircraft or whatever, then that is a different agreement to amend the existing one. But unless WN and Boeing agree on something else other than what is in the orignal purchase agreement, there is nothing to mitigate whatever was previously agreed and signed.


Delivery delay and grounding are two different things. I should have been more clear. Yes, if the contract has delivery delay penalties in it, that would be the compensation for frames not delivered timely.

However, on frames already delivered the mitigating factors would come into play. I'm sure there is a warranty and since all of the MAX frames are pretty new they still fall under it. The warranty will cover the cost of the upgrades and possibly the cost of maintenance while grounded. I doubt the warranty provides specified compensation for days out of service, but it might.

If it does, that will be better for Boeing because the impact of a frame out of service for a few days of a repair is a much lower cost than a whole fleet being out of service. Normal spares limit cancellations from a frame being in the hangar. That's not the case with a grounding.


:thumbsup: now we are in agreement. For already delivered in service aircraft different rules apply. Normally you would have some kind if dispatch reliability in the contract, but I am not sure that applies if the whole type is grounded.
 
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InsideMan
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 7:42 am

asdf wrote:
InsideMan wrote:
Nope, sorry but that is simply not true. If WN successfully negotiated that Boeing has to pay 1m US$ for each day of delay with no cap on it, than that is what Boeing has to pay. It doesn't matter what other aircraft WN might use or not use in the interim.


This may be in regard to a delay of delivery
But they deliver!

Because of the grounding BA may be liable for payment
but it lies in the responsibility of the airlines to prove how big is their financial harm

so it does matter what other aircraft WN might use or not use in the interim
because this has an influence on their financial disadvantage


which 737 MAX has been delivered since the grounding? Even if Boeing tried to deliver an aircraft they would not get the airworthiness certificate from the FAA nor would the customer sign his certificate of acceptance....
 
asdf
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 7:56 am

InsideMan wrote:
which 737 MAX has been delivered since the grounding? ....


we dont know, do we?

maybe they
- delivered and the planes now are owned by the airlines but are parked @ BA
- informed that the planes are ready for picking up, but the airlines didnt pick them up

there are a lot of situations think able
both sides will try to bring themself in the best possible position for the legal stuff
 
WIederling
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 8:05 am

asdf wrote:
InsideMan wrote:
which 737 MAX has been delivered since the grounding? ....


we dont know, do we?

maybe they
- delivered and the planes now are owned by the airlines but are parked @ BA
- informed that the planes are ready for picking up, but the airlines didnt pick them up

there are a lot of situations think able
both sides will try to bring themself in the best possible position for the legal stuff


If Boeing were able to foist off unflyable frames to customers
I'd guess that fact would be spread across all the major press outlets to make that confidence visible.
( potentially selling MAX frames to IAG/BA certainly got that treatment.)
Murphy is an optimist
 
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InsideMan
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 8:28 am

asdf wrote:
InsideMan wrote:
which 737 MAX has been delivered since the grounding? ....


we dont know, do we?

maybe they
- delivered and the planes now are owned by the airlines but are parked @ BA
- informed that the planes are ready for picking up, but the airlines didnt pick them up

there are a lot of situations think able
both sides will try to bring themself in the best possible position for the legal stuff


put aside the potential PR fiasco and the strain it would put on the relationship with your customers who can still cancel their order,
your theory already falls apart at the FAA. While Boeing CAN do aircraft acceptance on behalf of the customer if he refuses to accept an aircraft
for any disproportionate reason. Then Boeing can put the customer on notice for failure to take delivery of the aircraft. But trust me, a lot has
to go wrong and you are willing to never get another order from that customer if you go down that way.

But that is a moot point, as mentioned before, you do not get a certificate of airworthiness for that aircraft right now, so a prerequisite for aircraft acceptance is not available.
 
RandWkop
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 8:29 am

https://www.cnbc.com/video/2019/08/12/n ... -safe.html

Maybe the FAA were coming under a lot of political pressure to lift the grounding?
 
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scbriml
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 8:49 am

asdf wrote:
maybe they
- delivered and the planes now are owned by the airlines but are parked @ BA
- informed that the planes are ready for picking up, but the airlines didnt pick them up

there are a lot of situations think able
both sides will try to bring themself in the best possible position for the legal stuff


If you were the CEO of an airline, would you accept delivery (which means making final payment) of a plane which has yet to be fixed to the satisfaction of the FAA or other authorities? :shock:

If you would, then I have a bridge you might be interested in.
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asdf
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 9:22 am

scbriml wrote:
asdf wrote:
maybe they
- delivered and the planes now are owned by the airlines but are parked @ BA
- informed that the planes are ready for picking up, but the airlines didnt pick them up

there are a lot of situations think able
both sides will try to bring themself in the best possible position for the legal stuff


If you were the CEO of an airline, would you accept delivery (which means making final payment) of a plane which has yet to be fixed to the satisfaction of the FAA or other authorities? :shock:



you guys are probably right

nevertheless, it depends on the contract ...
 
planecane
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 10:09 am

RandWkop wrote:
https://www.cnbc.com/video/2019/08/12/new-faa-head-boeing-737-max-wont-fly-until-im-assured-it-is-safe.html

Maybe the FAA were coming under a lot of political pressure to lift the grounding?

Where do you get that form that report? The FAA has been saying the same thing for months.
 
art
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 11:12 am

asdf wrote:
InsideMan wrote:
which 737 MAX has been delivered since the grounding? ....


we dont know, do we?

maybe they
- delivered and the planes now are owned by the airlines but are parked @ BA
- informed that the planes are ready for picking up, but the airlines didnt pick them up

there are a lot of situations think able
both sides will try to bring themself in the best possible position for the legal stuff


Why would any customer take delivery of and pay the outstanding balance on a capital good and then store it? A lot of customers have insufficient lift as a consequence to which one remedy is to lease lift. That needs money. If a customer has paid $$$ for a non-useable MAX, that customer may then need to pay $$$ to lease a replacement.
 
ArgentoSystems
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 11:33 am

asdf wrote:
InsideMan wrote:
which 737 MAX has been delivered since the grounding? ....


we dont know, do we?

maybe they
- delivered and the planes now are owned by the airlines but are parked @ BA
- informed that the planes are ready for picking up, but the airlines didnt pick them up

there are a lot of situations think able
both sides will try to bring themself in the best possible position for the legal stuff


Maybe you don't know, but we do. There is an official Boeing delivery stats, showing 0 delivered MAXes since ET.
 
frmrCapCadet
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 12:04 pm

There may be limits of liability, or all sorts of other clauses in those contracts. Both parties want to get this behind them, and get the planes flying. Legal strategies alone will not get Boeing and the airlines through this, mutual accommodation likely will play a big role. As to families of those who died a different set of strategies is in order.
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B777LRF
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 12:37 pm

asdf wrote:
This may be in regard to a delay of delivery
But they deliver!


asdf wrote:
InsideMan wrote:
which 737 MAX has been delivered since the grounding? ....


we dont know, do we?.


asdf wrote:
maybe they
- delivered and the planes now are owned by the airlines but are parked @ BA
- informed that the planes are ready for picking up, but the airlines didnt pick them up

there are a lot of situations think able


To put it in the most simple terms:

* The 737 Max does not currently hold a Certificate of Airworthiness
* Having a valid CoA is a prerequisite for acceptance of an aircraft by the customer

Which means, that Boeing are indeed not delivering any 737 Max at the moment, and haven't for quite some time now, thus not collecting delivery payments either. The latter is reflected in their latest financial report which, despite a questionable amount set aside for the losses associated with the grounding, are not pretty at all.

On top of this, you have customers who've ordered hundreds of the things, and arranged themselves to accommodate deliveries thereof, now looking around for a) solutions and b) compensation. The former is an ever growing headache, but the latter is all but assured due to Boeing's monumental failures bringing the Max v1 to market. It's really only a question of how much the customers can wring out of B; the repercussions may be very financially challenging indeed.
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freakyrat
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 1:15 pm

planecane wrote:
RandWkop wrote:
https://www.cnbc.com/video/2019/08/12/new-faa-head-boeing-737-max-wont-fly-until-im-assured-it-is-safe.html

Maybe the FAA were coming under a lot of political pressure to lift the grounding?

Where do you get that form that report? The FAA has been saying the same thing for months.


The FAA want's to be absolutely sure that the aircrsft is safe. However the new FAA Administrator comes from Delta who doesn't operate the MAX so the delay in recertification while necessary actually benefits airlines that do not operate the MAX.
 
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PixelFlight
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 1:33 pm

B777LRF wrote:
* The 737 Max does not currently hold a Certificate of Airworthiness

AFAIK the 737-8/9 MAX only have prohibition / suspended / banned (depending on the country) flight operation. I.e. for USA https://www.faa.gov/news/updates/media/Emergency_Order.pdf
I did not remember reading a change regarding the 737-8/9 MAX Certificate of Airworthiness. Please give a link if it's the case.
 
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Revelation
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 1:36 pm

freakyrat wrote:
The FAA want's to be absolutely sure that the aircrsft is safe. However the new FAA Administrator comes from Delta who doesn't operate the MAX so the delay in recertification while necessary actually benefits airlines that do not operate the MAX.

Great, we now are suggesting that the new head of the FAA is a DL operative even before he makes his first official acts.

Don't you think he'll be pretty conscious of the fact that he is ex-DL and thus exposed to claims of favoritism?

That leaves us either (a) he's too dumb to understand this yet got appointed head of FAA, or (b) he's brazen enough to ignore it and be OK with being seen as a DL operative.
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Vladex
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 1:41 pm

Eiszeit wrote:
Vladex wrote:
qf789 wrote:
A new report puts the lost revenue at $4.1 billion loss by airlines due to the 737MAX grounding

https://www.forbes.com/sites/tedreed/20 ... 6b3e491fdf



Airlines bear the responsibility for their choice of aircraft. In this case, it is said that Boeing built an aircraft that the airlines wanted, cheap and easy to use with some modern features that may or may not fit or work . Unless they can prove that they didn't want the airplane in the first place and that it was coerced and foisted upon them then this is just the cost of doing business.


Boeing sold an aircraft certified for commercial passenger service. If the aircraft loses the certification it is boeings problem, because they sold an item with different specifications than contractually agreed.


Boeing sold thousands of orders of an aircraft long before it was certified for passenger service (spring 2017) so certification bears no impact on selling an aircraft. Boeing even sold 200 to IAG while it was decertified and grounded so selling an aircraft is entirely a choice of an airline or a group that has no outside coercive influence. All the airlines involved here ordered 737 MAX before it was certified and some ordered before it was offered (American and Southwest). And it was decertified only after crashes and groundings just like any other malfunctioning product. In other words, aircraft were sold before they were certified and they were crashed while they were certified. Many aircraft go out of production while being really good and certified and OEM`s take a hit for that. If airlines buy an aircraft , it is their responsibility entirely after they accept it regardless of what happens aferwards, that`s why they have acceptance flights.

Being certified is thus merely a commercial and legal standing open to interpretation and legislation that Boeing or any other company has little to no influence on . I think 737 MAX was grounded to protect airlines and Boeing as passengers would boycott it or it was likely there would be another big crash and all the issues that would entail. These government authorities are only there to promote commercial trade and right now MAX is not worth it, maybe they are just testing time. The choice of aircraft and routes is why airlines succeed or fail. Let airlines fail if they make such bad fails , it will teach others to be careful with what they wish and OEM`s won`t be making such compromised aircraft
 
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InsideMan
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 2:06 pm

PixelFlight wrote:
B777LRF wrote:
* The 737 Max does not currently hold a Certificate of Airworthiness

AFAIK the 737-8/9 MAX only have prohibition / suspended / banned (depending on the country) flight operation. I.e. for USA https://www.faa.gov/news/updates/media/Emergency_Order.pdf
I did not remember reading a change regarding the 737-8/9 MAX Certificate of Airworthiness. Please give a link if it's the case.


you may confuse type cerficate and CoA? CoA is individual for each aircraft issued at time of delivery to be allowed to operate the aircraft.
https://www.faa.gov/news/updates/media/ ... _Order.pdf
While this does not mention in production aircraft it states on page two, that experimental airworthiness certificates can be issued to support certification of design changes. These will then not allow PAX operations etc.
 
FluidFlow
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 2:15 pm

freakyrat wrote:
planecane wrote:
RandWkop wrote:
https://www.cnbc.com/video/2019/08/12/new-faa-head-boeing-737-max-wont-fly-until-im-assured-it-is-safe.html

Maybe the FAA were coming under a lot of political pressure to lift the grounding?

Where do you get that form that report? The FAA has been saying the same thing for months.


The FAA want's to be absolutely sure that the aircrsft is safe. However the new FAA Administrator comes from Delta who doesn't operate the MAX so the delay in recertification while necessary actually benefits airlines that do not operate the MAX.



The new head of the FAA has a lot of pressure not only because of Boeing wanting the aircraft back into service but because he will be the face of disaster or success of the "new" Max. If he gives a green light and 1-24 months down the line a MAX crashes due to bad design approved by the FAA he is done and possibly branded as the worst head of the FAA. His career in aviation is over. If he approves and the 737 Max is the safest aircraft ever to be flown, as Boeing hopes and states, he will be linked to this re-certification and that the FAA did everything right under his guidance. So he needs to get this right even if it takes 12 months from now instead of 3, because it is his head that will be cut off if it is not done right.
 
NDiesel
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 2:51 pm

Norwegian «discontinues all Trans-Atlantic routes with the 737MAX» according to Norwegian newspaper VG.

Impending cancellation of their order?
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ShamrockBoi330
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 2:55 pm

NDiesel wrote:
Norwegian «discontinues all Trans-Atlantic routes with the 737MAX» according to Norwegian newspaper VG.

Impending cancellation of their order?


what is the situation with all the Airbus they have on order for their leasing arm? is it possible they could start using some of these themselves?
 
FluidFlow
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 2:56 pm

I wonder when the date comes, when the penalties for late deliveries become larger than the penalties for cancellations and airlines will just say to Boeing to keep their money and cancel the order. For certain airlines this might come in handy in the upcoming economic downturn.
 
planecane
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 3:01 pm

Revelation wrote:
freakyrat wrote:
The FAA want's to be absolutely sure that the aircrsft is safe. However the new FAA Administrator comes from Delta who doesn't operate the MAX so the delay in recertification while necessary actually benefits airlines that do not operate the MAX.

Great, we now are suggesting that the new head of the FAA is a DL operative even before he makes his first official acts.

Don't you think he'll be pretty conscious of the fact that he is ex-DL and thus exposed to claims of favoritism?

That leaves us either (a) he's too dumb to understand this yet got appointed head of FAA, or (b) he's brazen enough to ignore it and be OK with being seen as a DL operative.


Also, I would assume that the head of the FAA is not allowed to own any airline stock, and possibly not aviation related mutual funds either.
 
FluidFlow
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 3:03 pm

Revelation wrote:
FluidFlow wrote:
The new head of the FAA has a lot of pressure not only because of Boeing wanting the aircraft back into service but because he will be the face of disaster or success of the "new" Max. If he gives a green light and 1-24 months down the line a MAX crashes due to bad design approved by the FAA he is done and possibly branded as the worst head of the FAA. His career in aviation is over. If he approves and the 737 Max is the safest aircraft ever to be flown, as Boeing hopes and states, he will be linked to this re-certification and that the FAA did everything right under his guidance. So he needs to get this right even if it takes 12 months from now instead of 3, because it is his head that will be cut off if it is not done right.

How will his future career in aviation go when he's made head of an agency that's supposed to be fair to all airlines, but then sits on the paperwork for the 737 for nine months for no apparent reason other than to favor one specific airline?



Sorry what??

I never said anything about any airline. Please read again. I said the decision to re-certify is about his career and therefore he will look through everything twice or three times. It is pressure from Boeing to do it quick vs pressure from his career perspective to do it right. I don't think he wants to be the guy to re-certify an aircraft type that is not save so he better makes sure it is save. And if this takes 2 or 6 or 9 additional months than so be it.
Would you do a job as fast as possible if your job and reputation depends on it or would you rather take longer but do it right? If he thinks end of October is right so be it, if he thinks otherwise then so be it. There is no agenda there.
 
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Revelation
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 3:22 pm

FluidFlow wrote:
Sorry what??
...
There is no agenda there.

Others are suggesting that the new FAA chief is ex-DL and is going to favor DL by making the 737 grounding as long as possible.

I'm sorry if it came across as if I was saying you were doing so, but I do wonder how he will deal with the reality that others may question his impartiality.

His job won't be easy.

Meanwhile, Boeing's CEO says:

In June, FAA pilots found a new potential issue with the 737 Max aircraft involved in both fatal crashes during a simulated flight, according to two sources familiar with the matter. The new flaw was traced to how data was processed by the flight computer and not related to reported problems with the anti-stall system, MCAS, sources told ABC News. They said it was connected to a broader anti-stall system called "speed trim."

Last week, Boeing CEO Dennis Muilenburg said the company had worked its way through the "technical details" and are "in the final stages of repairing that software."

"We'll go through certification with the FAA," Muilenburg said. "We plan to submit that certification package in September and currently anticipate that we will return the airplane to service early in the fourth quarter."

Ref: https://abcnews.go.com/Politics/faa-adm ... d=64932657

I'm pretty sure Boeing is posting the most optimistic timeline possible, but I would remind people that FAA has been in the loop for all the MAX testing (they were part of the testing that found the 'cosmic ray' issue) and it's hard to project the remaining steps will take nine more months of review, unless some other significant issue crops up.
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runway23
Posts: 2263
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 3:25 pm

FluidFlow wrote:
I wonder when the date comes, when the penalties for late deliveries become larger than the penalties for cancellations and airlines will just say to Boeing to keep their money and cancel the order. For certain airlines this might come in handy in the upcoming economic downturn.


If you have a replacement solution lined up then why not. But most airlines won't be able to get another similar product in a short time frame. So most will be forced to wait.
 
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PixelFlight
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 3:29 pm

InsideMan wrote:
PixelFlight wrote:
B777LRF wrote:
* The 737 Max does not currently hold a Certificate of Airworthiness

AFAIK the 737-8/9 MAX only have prohibition / suspended / banned (depending on the country) flight operation. I.e. for USA https://www.faa.gov/news/updates/media/Emergency_Order.pdf
I did not remember reading a change regarding the 737-8/9 MAX Certificate of Airworthiness. Please give a link if it's the case.


you may confuse type cerficate and CoA? CoA is individual for each aircraft issued at time of delivery to be allowed to operate the aircraft.
https://www.faa.gov/news/updates/media/ ... _Order.pdf
While this does not mention in production aircraft it states on page two, that experimental airworthiness certificates can be issued to support certification of design changes. These will then not allow PAX operations etc.

I don't know if "B777LRF" was referring to type certificate or CoA. He say "Certificate of Airworthiness" but in a way that is general to all 737 MAX, like the type certificate do.
As you point out, only experimental airworthiness certificates can be issued, so my understanding is that each of the 737-8/9 in the actual Boeing stock don't actually hold CoA but have a type certificate.
 
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PixelFlight
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 3:59 pm

NDiesel wrote:
Norwegian «discontinues all Trans-Atlantic routes with the 737MAX» according to Norwegian newspaper VG.

Impending cancellation of their order?

Last Saturday I spotted airstairs attached to two Norwegian's 737-8/9 MAX grounded at the Helsinki Airport, wondering what there have to do with them...
Image
 
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rikkus67
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 4:23 pm

Vladex wrote:
Eiszeit wrote:
Vladex wrote:


Boeing even sold 200 to IAG while it was decertified and grounded so selling an aircraft is entirely a choice of an airline or a group that has no outside coercive influence.


I am baffled by the continuing idea that this was "new" sales. This deal was at least partially orchestrated to fill the void lost with the Jet Airways collapse, of which the final tally is something in the order of -2 to -5 total "sales".

I am sure IAG received a VERY sweet deal to take these delivery spots.

...just sayin'.
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Vladex
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 5:24 pm

rikkus67 wrote:
Vladex wrote:
Eiszeit wrote:


I am baffled by the continuing idea that this was "new" sales. This deal was at least partially orchestrated to fill the void lost with the Jet Airways collapse, of which the final tally is something in the order of -2 to -5 total "sales".

I am sure IAG received a VERY sweet deal to take these delivery spots.

...just sayin'.


That order or whatever it was proves that airplane type doesn`t have to be certified to be sold or even flyable. If airlines accept an airplane on an acceptance flight then they bear entire responsibility for it. Certification only shows that the operator can accept the government issued fiat currency from passengers that is taxable by that government, it doesn`t say anything else. Safety is only a general term in the certification system but only as far as it promotes economic activity.

Grounding was done to protect the airlines to an extent from the public, imagine empty airplanes, scares and maybe a further crashes. The certification only certifies general characteristics of an airplane, it doesn`t say anything about the major integration of the main parts such as fuselage, wings, engines and landing gear. Those designs again are first and foremost commercially driven
 
DenverTed
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Re: Boeing 737MAX Grounded Worldwide Q3 2019

Tue Aug 13, 2019 5:52 pm

[quote="Revelation"[list]]

FAA has been in the loop for all the MAX testing (they were part of the testing that found the 'cosmic ray' issue) [/quote]

Did they find the cosmic ray issue in testing, or did they simulate a cosmic ray event to a specific test?

Basically, grandfathering of single computer architecture is revoked due to potential for cosmic ray bit flip.

I wonder if the 737 is the only recently produced aircraft with this, or if the CRJ or some other older designs run on one computer?

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