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Bongodog49
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:24 pm

Amiga500 wrote:
seahawk wrote:
Airbus knows the MAX will be back.


Does it?

With the Boeing executives simply having to know* what the ripple effect of a sudden stop of the FAL will do to the wider ecosystem - I'm not entirely convinced Boeing knows if the MAX will be back.


*if they don't - then what the ____ have they been talking about for 2 days in meetings?!?


This is one of only two aerospace projects in the World that is too large to fail, the book value of the grounded fleet, the undelivered aircraft and the already built parts is larger than anyone would ever contemplate writing off, thats before you count the thousands of outstanding orders.

The other factor is that the airlines have no option but to stick with the 737, the only other viable option is the A320 and it would take Airbus in all likelihood 3 or 4 years to double production.

It may well be however that it comes back much modified in order to ensure its safe operation with an admission from Boeing that it is the end of the road for the 737 design and an announcemnt of its succesor
 
planecane
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:30 pm

dtw2hyd wrote:
planecane wrote:
...if they have to end up paying $1 million per frame for additional training, that will end up being $5 billion to $6 billion over the life of the program.


The $1Million/frame demand is from one operator.

Other airlines particularly third world airlines would be happy to accomodate any new training requirement recommended by Boeing. There are several ways to manage delta training, Immidiately train a few as MAX deliveries are coming in, and update the syllubus as part of routine refresher training. Manage rostering. It won't cost $1M/frame to operator and Boeing need not to bare that cost.

You are making it sound like all 737 pilots has to stop flying and hit training centers overnight, just because there are 10 MAXes out out of 600 737s.


Once can assume that Southwest didn't just pull a number out of their rear. They obviously calculated that it would cost $1 million per frame if there needed to be MAX specific simulator training. I don't think other airlines, particularly third world airlines, would happily eat this cost.
 
XRAYretired
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:37 pm

planecane wrote:
Amiga500 wrote:
seahawk wrote:
Airbus knows the MAX will be back.


Does it?

With the Boeing executives simply having to know* what the ripple effect of a sudden stop of the FAL will do to the wider ecosystem - I'm not entirely convinced Boeing knows if the MAX will be back.


*if they don't - then what the ____ have they been talking about for 2 days in meetings?!?


If there were indications from the FAA that the MAX might not return and Boeing didn't disclose that information, they would be violating SEC regulations and risking enormous fines and quite possibly prison time for the executives.

I don't understand the wild speculation going on in this thread now. Months ago, Boeing said that if RTS didn't happen by the end of the year they could halt production. A week or two ago, the FAA said that recertification would take until sometime in 2020.

Those two things combined lead to Boeing halting production. It's that simple. There wasn't a discovery that the MCAS 2.0 software doesn't work or the FCC can't handle the new software. There wasn't a discovery that if an AoA sensor failed there was a high risk of diverting with MCAS disabled. If any of these things (or other crazy theories) had happened, there would be leaks to the aviation media.

The most likely scenario is exactly what has been reported. They are still arguing over training requirements. As much as this has already cost Boeing, if they have to end up paying $1 million per frame for additional training, that will end up being $5 billion to $6 billion over the life of the program. Another 3 months of grounding isn't going to cost near that even if they have some penalties to pay suppliers.

Might have to have a think about this?

'Leaked' to the media in the last month or so -

Software audit 'failed' and suspended (and still not completed to last week).

Re Mr Marko's leaked email
- MCAS Reliability still High Risk. Suspect this is actual availability in a dual sensor system (and why the bare airframe test is required by EASA).
- FCC X Channel monitor Common mode fault. (FCC cant handle new requirement perhaps?).
- 12.1 software MCAS Authority Limit not effective, still Catastrophic (MCAS 2.0 does not work perhaps?).

Pilot group New/Revised Procedures and training evaluation - 'Failed'.

The question of Simulator training will only raise its head again when the JOEB have their get together. When that will be now is any bodies guess.

Ray
 
Bongodog49
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:41 pm

morrisond wrote:
Interested wrote:
planecane wrote:

If there were indications from the FAA that the MAX might not return and Boeing didn't disclose that information, they would be violating SEC regulations and risking enormous fines and quite possibly prison time for the executives.

I don't understand the wild speculation going on in this thread now. Months ago, Boeing said that if RTS didn't happen by the end of the year they could halt production. A week or two ago, the FAA said that recertification would take until sometime in 2020.

Those two things combined lead to Boeing halting production. It's that simple. There wasn't a discovery that the MCAS 2.0 software doesn't work or the FCC can't handle the new software. There wasn't a discovery that if an AoA sensor failed there was a high risk of diverting with MCAS disabled. If any of these things (or other crazy theories) had happened, there would be leaks to the aviation media.

The most likely scenario is exactly what has been reported. They are still arguing over training requirements. As much as this has already cost Boeing, if they have to end up paying $1 million per frame for additional training, that will end up being $5 billion to $6 billion over the life of the program. Another 3 months of grounding isn't going to cost near that even if they have some penalties to pay suppliers.


You honestly think arguing over training would lead them to halt production?

The announcement has already devalued the company by 5 to 10 billion US dollars - just announcing it !

So your simple explanation doesn't make sense. The announcement alone has already devalued the company more than any training might have cost them?

If it was as simple and forward thinking as you suggest then there would have been a much better and streamlined plan to slow down and stop production gradually


There is no cost to Boeing of a decrease in the value of what the shares trade for in the Open market.

The only real impact is that when/if the MAX returns to production and they resume share buybacks and the price is lower - Earnings per share will increase further. Or if they decide to issue shares they might have to issue more to get the same amount of money.

They currently have a Market Cap of $184 Billion - it looks like it might fall about 2% on the open today which is Peanuts given the announcement and I suspect that by the end of the day it might actually have gone up as Investors will be happy they are not burning as much cash.

If they needed to raise cash they could sell $10-20 Billion of shares in a Primary Offering basically instantly with a promise to buy them back when Production resumes and they deliver inventory probably at very little cost to the share price. Effectively a Shareholder loan.


The devaluation of the share price can be a problem, this is the perceived value of the business to its investors based on its present operations/management. The lower the value, the higher the interest rate Boeing has to pay on any borrowings. Also the lower the perceived value to the shareholders the more vulnerable the business becomes to an outside investor looking to takie it on and break it up for profit. The share price has dropped around 25% this year (though admittedly it was a record high at the beginning of the year) It would take a brave fund manager to turn down an offer close to the high point.
 
TC957
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:42 pm

The best way forward for Boeing now is to scrap every single MAX built and come up with an updated version without MACS.
 
XRAYretired
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:43 pm

Amiga500 wrote:
planecane wrote:
I don't understand the wild speculation going on in this thread now. Months ago, Boeing said that if RTS didn't happen by the end of the year they could halt production. A week or two ago, the FAA said that recertification would take until sometime in 2020.


I'm going on the basis there was supposedly test flights with EASA last week - and then there is what appears to be a very immediate* shutdown announced start of this week.

*with not much managing of the ramp down. Alright folks, go from rate ~50 to 0 please. That is a disaster waiting to happen.

Nop. EASA Cert Test Flight will be conducted on a certification configuration aircraft when the certification standard is established. This has not yet happened.

Ray
 
XRAYretired
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:51 pm

par13del wrote:
Amiga500 wrote:
planecane wrote:
I don't understand the wild speculation going on in this thread now. Months ago, Boeing said that if RTS didn't happen by the end of the year they could halt production. A week or two ago, the FAA said that recertification would take until sometime in 2020.


I'm going on the basis there was supposedly test flights with EASA last week - and then there is what appears to be a very immediate* shutdown announced start of this week.

*with not much managing of the ramp down. Alright folks, go from rate ~50 to 0 please. That is a disaster waiting to happen.

So EASA went over the FAA head and caused Boeing to halt production?
The FAA has had Boeing fixes for over a month and have not completed their analysis after a ton of test flights both in the air and simulators, but they conduct 1 test flight for EASA and shut down the next day?

Its got nought to do with EASA, as you well know. Please stop winding up the natives.

Ray
 
capitalflyer
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:56 pm

This thread and previous thread are far too long. Can mods subdivide 737MAX discussion into topic areas, ie. airline schedules, technical fixes, aircraft sales market, etc.That or figure our some kind of cap for how many pages it gets to. Up to 92 and counting on this one alone. Perhaps cap at 20? 30? Very difficult to follow the myriad discussions on the vast number of important areas that this touches.
 
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lightsaber
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 2:58 pm

planecane wrote:
Boeing made that statement months ago. If a shutdown was going to happen, it was going to be immediate. There would be no point in ramping down or announcing a shutdown in March because it would make no sense if RTS happened during the ramp down or before the shutdown was to happen.

Part of the shutdown I'm sure is to get the attention of politicians. As long as Boeing was producing away and buying parts at the 52 per month rate from suppliers and agreeing to compensate customers (and, in some cases pilots), the only people getting harmed were Boeing shareholders and Boeing executives. That allowed the FAA and other regulators to literally take as much time as they wanted to. The shutdown won't lead to a rubber stamp approval but it will light a fire under the FAA especially to work more quickly and be more upfront with Boeing on exactly what they want for RTS.

This is a nice summary. Before, Boeing took all the pain of delays. With the clear communication that this will be a joint recertification, Boeing knows it will be a long time before RTS.

Boeing is listening. They are taking this seriously. But they just dumped the pain on their risk sharing partners and employees. Since no time will or can be given by the regulators, Boeing is standing down.

Everyone now knows this just ratcheted up in seriousness.

Some parts of this business cannot be just turned off. For example, CFM will receive the last rotors, shafts, and turbine blades started pre-grounding in January. They are committed to casings another six months out.

I'm trying to figure out how many people are directly employed on the MAX. If I estimate $100,000 per employee per year (low for Washington employees, high for Witchita), I estimate 125,000 to 150,000 employed directly by the MAX production.

One heck of a Christmas present for the industry. This is one of the two too big to fail projects in the industry.

Boeing won't lay off short term, but the demand for temporary work just went away (mostly).

Lightsaber
Winter is coming.
 
IADFCO
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:02 pm

I find it interesting (for people like me in the peanut gallery) that after so many months we still don't know what is wrong aerodynamically with the MAX. Yes, the pitch up and the stick lightening have been mentioned over and over, but for me they are symptoms, not the disease. Yes, the position of the engines, but how, precisely, does that come into the picture? The only leaks on this come from one of the first NYT articles: (i) some form of transonic effects play a role (OK, shock-induced separation, but where? and ok in the high-speed turns, but at 1g low speed?); and (ii) aerodynamic fixes were attempted but did not work.

My speculation is that separated flow from the nacelle induces premature separation from the leading edge of a big chunk of the wing, and makes reattachment harder. That is, it's easier to get into a stall than in the NG, and harder to get out. But that's all it is: my own speculation.

I thought that technical details would come out as part of the litigation -- what did the Boeing aerodynamicists know and when did they now it? But we haven't heard too much about litigation in general. I assume Boeing will try to extract NDAs from everybody.

Obviously Boeing knows exactly what's wrong, and maybe even the FAA. For us A.nutters this is a spectator sport (with the sad caveat that it's been a tragedy) so we don't need to know, but still, it's interesting for me that there have been no leaks, let alone an official technical explanation. In January there will be the AIAA SciTech conference, which would be the obvious venue for technical discussions.
 
2175301
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:04 pm

XRAYretired wrote:
Amiga500 wrote:
Nop. EASA Cert Test Flight will be conducted on a certification configuration aircraft when the certification standard is established. This has not yet happened.

Ray


Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."

If I recall correctly the FAA head has stated that he will not allow certification of the aircraft until he personally is convinced it is safe. I do not recall him saying that it will be certified when it meets regulatory requirements. There is a huge difference...

In the USA construction of Nuclear Power Plants ended, even forcing some utilities and suppliers into bankruptcy because the NRC kept changing the standards while a plant was being constructed - forcing major rework and redesign of existing construction that fully met the standards when it was constructed (which also lengthened the construction time). Utilities could no longer predict the cost or timing of building a plant as their cost tripled or quadrippled from original estimates when construction was started a few years earlier. The NRC has since adopted that plant designs are "pre-approved" and your plant will be licensed if you build to the approved design, but that took decades to get there.

IF the problem is that the reason that Boeing suspended production is that ever-time they comply with something - another issue is raised (i.e. Bit Flip in June, and word was that MCAS V2.0 tested OK)... then there is no end in sight... as how can you design and build something for which the standards are not defined. Then, I put that blame on the regulators. While they do have to ensure reasonable safety, the regulations do not require perfect safety; and the regulations also allow "grandfathering" where there is demonstrated safety from experience combined with the significance of the cost factor. The 737 has vast hours and cycles of operation and so many items about it's original design have proven over the decades that they meet the base statistical safety criteria.

Have a great day,
 
morrisond
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:04 pm

Bongodog49 wrote:
morrisond wrote:
Interested wrote:

You honestly think arguing over training would lead them to halt production?

The announcement has already devalued the company by 5 to 10 billion US dollars - just announcing it !

So your simple explanation doesn't make sense. The announcement alone has already devalued the company more than any training might have cost them?

If it was as simple and forward thinking as you suggest then there would have been a much better and streamlined plan to slow down and stop production gradually


There is no cost to Boeing of a decrease in the value of what the shares trade for in the Open market.

The only real impact is that when/if the MAX returns to production and they resume share buybacks and the price is lower - Earnings per share will increase further. Or if they decide to issue shares they might have to issue more to get the same amount of money.

They currently have a Market Cap of $184 Billion - it looks like it might fall about 2% on the open today which is Peanuts given the announcement and I suspect that by the end of the day it might actually have gone up as Investors will be happy they are not burning as much cash.

If they needed to raise cash they could sell $10-20 Billion of shares in a Primary Offering basically instantly with a promise to buy them back when Production resumes and they deliver inventory probably at very little cost to the share price. Effectively a Shareholder loan.


The devaluation of the share price can be a problem, this is the perceived value of the business to its investors based on its present operations/management. The lower the value, the higher the interest rate Boeing has to pay on any borrowings. Also the lower the perceived value to the shareholders the more vulnerable the business becomes to an outside investor looking to takie it on and break it up for profit. The share price has dropped around 25% this year (though admittedly it was a record high at the beginning of the year) It would take a brave fund manager to turn down an offer close to the high point.


The value of the shares - has almost zero influence on Boeings cost to borrow money - unless the price of the shares were severely impaired (say less than $50) and they could not raise sufficient capital by issuing new shares.

Boeing has a market Cap of $184,032,660,000 as of this second. If someone were to try and take that over they would probably have to pay at least a 30% premium on that making it the Largest Leveraged Buy out in history by about 8X.

It would take someone like Microsoft with the cash to buy it - which will never happen. Or a Merger with someone like Lockheed Martin - but even Lockheed Martin only has an Market Cap of $108B and a little more than $2B cash on hand - they would not be the ones being acquired.
 
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par13del
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:05 pm

XRAYretired wrote:
par13del wrote:
Amiga500 wrote:

I'm going on the basis there was supposedly test flights with EASA last week - and then there is what appears to be a very immediate* shutdown announced start of this week.

*with not much managing of the ramp down. Alright folks, go from rate ~50 to 0 please. That is a disaster waiting to happen.

So EASA went over the FAA head and caused Boeing to halt production?
The FAA has had Boeing fixes for over a month and have not completed their analysis after a ton of test flights both in the air and simulators, but they conduct 1 test flight for EASA and shut down the next day?

Its got nought to do with EASA, as you well know. Please stop winding up the natives.

Ray

Thought I was trying to get the native who was doing the winding up to provide clarity, guess that's my bad.
 
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N14AZ
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:08 pm

With all due respect. I think we all need to relax a little bit. I guess the next proposal is that Boeing will procure some old Baade 152 drawings in order to start building a new NSA...

Is the situation bad? Yes.
Or maybe very bad? Most probably yes.
But will Boeing fail and cancel the max-program? Of course not.
 
planecane
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:15 pm

IADFCO wrote:
I find it interesting (for people like me in the peanut gallery) that after so many months we still don't know what is wrong aerodynamically with the MAX. Yes, the pitch up and the stick lightening have been mentioned over and over, but for me they are symptoms, not the disease. Yes, the position of the engines, but how, precisely, does that come into the picture? The only leaks on this come from one of the first NYT articles: (i) some form of transonic effects play a role (OK, shock-induced separation, but where? and ok in the high-speed turns, but at 1g low speed?); and (ii) aerodynamic fixes were attempted but did not work.

My speculation is that separated flow from the nacelle induces premature separation from the leading edge of a big chunk of the wing, and makes reattachment harder. That is, it's easier to get into a stall than in the NG, and harder to get out. But that's all it is: my own speculation.

I thought that technical details would come out as part of the litigation -- what did the Boeing aerodynamicists know and when did they now it? But we haven't heard too much about litigation in general. I assume Boeing will try to extract NDAs from everybody.

Obviously Boeing knows exactly what's wrong, and maybe even the FAA. For us A.nutters this is a spectator sport (with the sad caveat that it's been a tragedy) so we don't need to know, but still, it's interesting for me that there have been no leaks, let alone an official technical explanation. In January there will be the AIAA SciTech conference, which would be the obvious venue for technical discussions.


If any extremely accurate scale models of the MAX exist, you could get one and find a university with a wind tunnel to take it to. That could give some idea of what is going on aerodynamically. I wouldn't expect Boeing to ever release specific information about it.
 
morrisond
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:22 pm

For those who are singing the death knell of Boeing - MAX suspension of deliveries only impacted Overall Company revenues by about 21% in the latest Quarter and about 40% of Commercial Aircraft orders Revenue. Wide Bodies are worth a lot.

They were still profitable without the MAX. They made $1.1 Billion in the Quarter. However they did burn about $2.5B in cash. Reportedly that will be reduced by about $3B per quarter with the stoppage in 737 Production - arguably making them Cash Flow positive again.

Basically that means they should have enough cash flow from their other Programs, Defense and Services to fund ongoing MAX grounding costs (Supporting Suppliers, Paying Storage and Employees, etc..).

They still had over $10 B cash on hand - which if they are cash flow positive going forward they will not have to use it. They could also raise additional Billions easily from Borrowing or issuing shares.

Basically Even if MAX is grounded forever they are more than big enough to survive and would easily be able to generate enough cash flow from operations to fund a new program or get it from the markets.

https://s2.q4cdn.com/661678649/files/do ... elease.pdf
 
mjoelnir
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:32 pm

2175301 wrote:
XRAYretired wrote:
Amiga500 wrote:
Nop. EASA Cert Test Flight will be conducted on a certification configuration aircraft when the certification standard is established. This has not yet happened.

Ray


Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."

If I recall correctly the FAA head has stated that he will not allow certification of the aircraft until he personally is convinced it is safe. I do not recall him saying that it will be certified when it meets regulatory requirements. There is a huge difference...

In the USA construction of Nuclear Power Plants ended, even forcing some utilities and suppliers into bankruptcy because the NRC kept changing the standards while a plant was being constructed - forcing major rework and redesign of existing construction that fully met the standards when it was constructed (which also lengthened the construction time). Utilities could no longer predict the cost or timing of building a plant as their cost tripled or quadrippled from original estimates when construction was started a few years earlier. The NRC has since adopted that plant designs are "pre-approved" and your plant will be licensed if you build to the approved design, but that took decades to get there.

IF the problem is that the reason that Boeing suspended production is that ever-time they comply with something - another issue is raised (i.e. Bit Flip in June, and word was that MCAS V2.0 tested OK)... then there is no end in sight... as how can you design and build something for which the standards are not defined. Then, I put that blame on the regulators. While they do have to ensure reasonable safety, the regulations do not require perfect safety; and the regulations also allow "grandfathering" where there is demonstrated safety from experience combined with the significance of the cost factor. The 737 has vast hours and cycles of operation and so many items about it's original design have proven over the decades that they meet the base statistical safety criteria.

Have a great day,


The standards are very simple, fulfill all the rules. A bit difficult for Boeing with the 737, having relied on exemptions to the rules for that bird for a long time now.

So it is rather what exemptions are we allowed to keep and the bad guys (the regulators) will not accept all our ideas for new exemptions
 
XRAYretired
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:33 pm

2175301 wrote:
XRAYretired wrote:
Amiga500 wrote:
Nop. EASA Cert Test Flight will be conducted on a certification configuration aircraft when the certification standard is established. This has not yet happened.

Ray


Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."

If I recall correctly the FAA head has stated that he will not allow certification of the aircraft until he personally is convinced it is safe. I do not recall him saying that it will be certified when it meets regulatory requirements. There is a huge difference...

In the USA construction of Nuclear Power Plants ended, even forcing some utilities and suppliers into bankruptcy because the NRC kept changing the standards while a plant was being constructed - forcing major rework and redesign of existing construction that fully met the standards when it was constructed (which also lengthened the construction time). Utilities could no longer predict the cost or timing of building a plant as their cost tripled or quadrippled from original estimates when construction was started a few years earlier. The NRC has since adopted that plant designs are "pre-approved" and your plant will be licensed if you build to the approved design, but that took decades to get there.

IF the problem is that the reason that Boeing suspended production is that ever-time they comply with something - another issue is raised (i.e. Bit Flip in June, and word was that MCAS V2.0 tested OK)... then there is no end in sight... as how can you design and build something for which the standards are not defined. Then, I put that blame on the regulators. While they do have to ensure reasonable safety, the regulations do not require perfect safety; and the regulations also allow "grandfathering" where there is demonstrated safety from experience combined with the significance of the cost factor. The 737 has vast hours and cycles of operation and so many items about it's original design have proven over the decades that they meet the base statistical safety criteria.

Have a great day,

No standards have changed. BitFlip requirement has been in place for decades. Just because you have not heard of it before does not mean it is new (except to the uninformed observer). MCAS added Hazardous/Catastrophic failure modes that were 'hidden' until exposed by the events and investigation. Boeing have so far failed to provide a compliant solution to the regulatory requirements that have existed for decades.

Ray
 
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Revelation
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:41 pm

lightsaber wrote:
Some parts of this business cannot be just turned off. For example, CFM will receive the last rotors, shafts, and turbine blades started pre-grounding in January. They are committed to casings another six months out.

The write up from Dominic Gates at ST ( https://www.seattletimes.com/business/b ... employees/ ) says:

For the 737’s global supply chain — which includes engine parts from the U.S and France, fuselages from Wichita, Kansas, and tail rudders from China—the stoppage in Renton is potentially very disruptive. But Boeing gave no information about how that will be handled.

Some major suppliers have contracts that require Boeing to continue to take delivery of their parts, and to pay for them. Others may have to suspend their own production.

So it could be that some of the bigger vendors providing major parts have contractual protection.

It's also interesting that the "pain" extends to China, who makes rudders for 737.

As an aside, I read that entire article and not once found a hint of the theory that production is being stopped because of some deeper flaw in the MAX.

This article comes from the same guy who has shown he has a broad network of contacts within Boeing and FAA.

I've also read reports from NYT, WaPo, CNBC, CNN, WSJ, AvWeek, etc and no one is floating the deeper flaw theory despite all the clicks it would generate.

If the deeper flaw does exist, I'm having a hard time seeing how the media would not have gotten wind of it by now.

I do find articles like the following, all saying the MCAS fix works and RTS is expected soon, including quotes from the EASA chief:
2175301 wrote:
Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."

IMO there is no need for a deeper theory than one that we are seeing reported, that Boeing has been saying for months now that if they could not RTS by end of the year they would consider halting production, and they chose to halt production because the actual situation with regard to them being able to predict the RTS time line is now worse than anticipated due to the decision to go with global RTS rather than US-first RTS.

I can imagine this is frustrating for insiders because of exactly what you say, the more people in the decision loop, the more difficult it is to get an agreement.

This thread shows a wide spectrum of concerns, and I'm sure the actual regulators who are experts in their field can come up with just as many if not more concerns, and with nothing motivating closure the process of addressing each concern being raised could go on indefinitely.

I think Boeing was willing to continue production as long as they had some confidence in the RTS procedure and time line, but once the CEO sat down with the new FAA chief such confidence was lost, and without that, there really was no other decision but to halt production.
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morrisond
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:53 pm

Boeing shares just turned positive on the day - Yes they are done as a going concern........

Investors don't seem to be fazed by this at all as I speculated on the previous page and will likely see it as a positive.
 
morrisond
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 3:57 pm

Revelation wrote:
lightsaber wrote:
Some parts of this business cannot be just turned off. For example, CFM will receive the last rotors, shafts, and turbine blades started pre-grounding in January. They are committed to casings another six months out.

The write up from Dominic Gates at ST ( https://www.seattletimes.com/business/b ... employees/ ) says:

For the 737’s global supply chain — which includes engine parts from the U.S and France, fuselages from Wichita, Kansas, and tail rudders from China—the stoppage in Renton is potentially very disruptive. But Boeing gave no information about how that will be handled.

Some major suppliers have contracts that require Boeing to continue to take delivery of their parts, and to pay for them. Others may have to suspend their own production.

So it could be that some of the bigger vendors providing major parts have contractual protection.

It's also interesting that the "pain" extends to China, who makes rudders for 737.

As an aside, I read that entire article and not once found a hint of the theory that production is being stopped because of some deeper flaw in the MAX.

This article comes from the same guy who has shown he has a broad network of contacts within Boeing and FAA.

I've also read reports from NYT, WaPo, CNBC, CNN, WSJ, AvWeek, etc and no one is floating the deeper flaw theory despite all the clicks it would generate.

If the deeper flaw does exist, I'm having a hard time seeing how the media would not have gotten wind of it by now.

I do find articles like the following, all saying the MCAS fix works and RTS is expected soon, including quotes from the EASA chief:
2175301 wrote:
Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."

IMO there is no need for a deeper theory than one that we are seeing reported, that Boeing has been saying for months now that if they could not RTS by end of the year they would consider halting production, and they chose to halt production because the actual situation with regard to them being able to predict the RTS time line is now worse than anticipated due to the decision to go with global RTS rather than US-first RTS.

I can imagine this is frustrating for insiders because of exactly what you say, the more people in the decision loop, the more difficult it is to get an agreement.

This thread shows a wide spectrum of concerns, and I'm sure the actual regulators who are experts in their field can come up with just as many if not more concerns, and with nothing motivating closure the process of addressing each concern being raised could go on indefinitely.

I think Boeing was willing to continue production as long as they had some confidence in the RTS procedure and time line, but once the CEO sat down with the new FAA chief such confidence was lost, and without that, there really was no other decision but to halt production.


Great post. After looking at the financial numbers (posted up thread) I believe this is simply about Cash Flow - by stopping Production they are Cash flow Positive even keeping all there workers employed.

It is the wise course of action.
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:06 pm

Revelation wrote:
lightsaber wrote:
Some parts of this business cannot be just turned off. For example, CFM will receive the last rotors, shafts, and turbine blades started pre-grounding in January. They are committed to casings another six months out.

The write up from Dominic Gates at ST ( https://www.seattletimes.com/business/b ... employees/ ) says:

For the 737’s global supply chain — which includes engine parts from the U.S and France, fuselages from Wichita, Kansas, and tail rudders from China—the stoppage in Renton is potentially very disruptive. But Boeing gave no information about how that will be handled.

Some major suppliers have contracts that require Boeing to continue to take delivery of their parts, and to pay for them. Others may have to suspend their own production.

So it could be that some of the bigger vendors providing major parts have contractual protection.

It's also interesting that the "pain" extends to China, who makes rudders for 737.

As an aside, I read that entire article and not once found a hint of the theory that production is being stopped because of some deeper flaw in the MAX.

This article comes from the same guy who has shown he has a broad network of contacts within Boeing and FAA.

I've also read reports from NYT, WaPo, CNBC, CNN, WSJ, AvWeek, etc and no one is floating the deeper flaw theory despite all the clicks it would generate.

If the deeper flaw does exist, I'm having a hard time seeing how the media would not have gotten wind of it by now.

I do find articles like the following, all saying the MCAS fix works and RTS is expected soon, including quotes from the EASA chief:
2175301 wrote:
Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."

IMO there is no need for a deeper theory than one that we are seeing reported, that Boeing has been saying for months now that if they could not RTS by end of the year they would consider halting production, and they chose to halt production because the actual situation with regard to them being able to predict the RTS time line is now worse than anticipated due to the decision to go with global RTS rather than US-first RTS.

I can imagine this is frustrating for insiders because of exactly what you say, the more people in the decision loop, the more difficult it is to get an agreement.

This thread shows a wide spectrum of concerns, and I'm sure the actual regulators who are experts in their field can come up with just as many if not more concerns, and with nothing motivating closure the process of addressing each concern being raised could go on indefinitely.

I think Boeing was willing to continue production as long as they had some confidence in the RTS procedure and time line, but once the CEO sat down with the new FAA chief such confidence was lost, and without that, there really was no other decision but to halt production.

I agree there is no need for a deeper theory. Boeing has become frustrated to not have a fixed goal. So they stand down.

Your link is interesting, but risk sharing partners, such as CFM, will share the pain. I'm certain casting and forging vendors refused risk sharing. Once material is ordered, Boeing, Spirit, UTX, Meggitt, British Aerospace, or CFM must pay the sub-vendor. Without knowing details of the risk sharing partners' contracts, I can only speculate.

So Boeing just motivated to close the process. I agree, they lost faith in the RTS process. The discussions today with the FAA will be very different thsn yesterday. No reduction in rigor, but at least a timeline to stop finding issues. A timeline to define requirements. Then Boeing could schedule RTS.

After 9 months of delays, many which were solved 4 or 5 months ago, is enough. It is the FAA's job to tell Boeing the requirements.

But because of jobs st Meggitt, British Aerospace, SAFRAN, and dozens (hundreds?) of other EU vendors, EASA will focus. I don't know if enough jobs are at risk in China to matter.

The end goal won't change, the time pressure will.

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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:15 pm

Has Boeing been more transparent in the past? Or as beholden to alternative truths?
In other words is this a new trend, or the way business has always been done.
DC3, CONVAIR CV440, Sud Aviation Caravelle, BOAC VC10,Convair Coronado,BAE 1-11,Vickers Viscount. Pan Am 707 747, Saab 340 2000,TWA Lockheed TriStar, DC-8,9,10, MD11. 727,757,767.SHORT 330, CRJ200, ERJ145, E190. F27, A340-600. Atr42 72.
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:16 pm

XRAYretired wrote:
Amiga500 wrote:
I'm going on the basis there was supposedly test flights with EASA last week

Nop. EASA Cert Test Flight will be conducted on a certification configuration aircraft when the certification standard is established. This has not yet happened.


I find this the most baffling. Why cannot Boeing start co-operating with EASA?

The possibilities are:
1) Boeing wants keep the system where all preliminary test flights happen with FAA only.
I assume there has been numerous test flights already with FAA using various versions of preliminary SW already in the summer.
2) Boeing is still tweaking the aerodynamics trying to find something that makes the plane work close to okay without MCAS SW.
3) Boeing knows that the plane cannot be made so that it works even close to okay without MCAS so better not to let nobody know that.
4) Boeing knows that the certification is so far into future anyway so not starting to work with EASA is not going to delay the certication
5) Boeing wishes that EASA just forgets that they wanted to see how the baseline plane behaviour which happens it there is some malfunction to AoA or MCAS and they shut off.
6) Stopping production provides more shareholder value rather than starting to work towards EASA certification.
7) Boeing wants to put EASA into hard spot not co-operating when them and coming at them in the last minute saying:
"Okay now we got an approval from FAA and they want to grant the certification tomorrow so we have 15 minutes to work through all your concerns. Sorry it looks we have no time for your test flight and even if you have pilots ready in the next 15 minutes for the flight they better not come up with any concerns from that test flight because we have no time to fix them and because this was our final certification configuration we cannot even in theory make any changes to it any more as that would be a contradiction to us naming the configuration to be the final certification configuration. So let's drop the flight, okay?"
8) Boeing wants EASA first try to guess blindfolded what exactly is the situation where MAX behaves catastrophically. And only if they miss the guess and write test spec so that it does not touch the problematic situation then they allow the test flight. Boeing pilots are then making sure that they avoid going near the condition where all hell breaks loose. Zero free flying allowed like Boeing pilots did years ago to suddenly come to the conclusion that MCAS is absolutely needed also on slow speeds.

Those are about all the possibilities I can think of. What other possibilities there are?

2175301 wrote:
Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."


Satire. Not to be taken seriously: So EASA on some days want to perform the approach to stall on 10 deg bank angle and on other days 15 deg bank angle. One of those is the one where MAX is uncontrollable and unless EASA decides on the other that is not showing the problem then we are not allowing them to fly. We hope EASA misses the condition to say that wild oscillations on stick are not allowed as nobody should reasonably assume those are a problem. In that case we can write to the test report that average stick forces measured over 2 second period are just within spec. The test spec mentioned nothing about wild oscillations so we don't have to report those.

It is within possibilities to write a spec that defines what is good and acceptable behaviour. But once that spec is broken and somebody needs to come up with some other spec that says that the behaviour is outside from good it is totally impossible to write a new spec consisting of not-good-but-somehow-acceptable behaviours when blindfolded not knowing what is the specific area and problematic condition one should consider their thinking.
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:16 pm

morrisond wrote:
They still had over $10 B cash on hand - which if they are cash flow positive going forward they will not have to use it.


Is the $6+ billion they set aside for customer compensation included in that $10 billion?
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:19 pm

I didn't realize Spirit had gone to a 4-day work week with the grounding:

https://leehamnews.com/2019/12/17/minim ... down-seen/

That link notes this is a 3 to 6 month shutdown. The link also notes Boeing hasn't communicated with vendors yet.

I suspect Boeing wants to keep vendors ready for a ramp up post RTS. I wonder how many could drop to short workweeks?

The longer this goes on, the more Boeing must conserve cash.

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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:22 pm

juliuswong wrote:
BigPlaneGuy13 wrote:
This leadership team at Boeing is arguably the biggest disgrace by any American company of the 21st century - even more so than the Wells Fargo/Equifax crises. At least nobody died from their misdoings.

I don't understand what the Board of Directors could possibly be waiting for. Dennis has already shot himself in both feet with a .22. He is untrustworthy and has clearly demonstrated he is a failure when in crisis. Forget the billions of dollars lost on the actual program - the value of the brand as a whole has bottomed out.

What an utter disappointment and shame. There will be hell to pay for many many years to come. I am at a loss for words at today's news.

They have nothing to be worried about, once the ban is lifted, they will just line up few premium airlines to buy MAX and invite media for publicity blitz. Loads of photos taken and champagne flows.......done!


At least nobody died from their misdoings?
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:25 pm

lightsaber wrote:
Revelation wrote:
lightsaber wrote:
Some parts of this business cannot be just turned off. For example, CFM will receive the last rotors, shafts, and turbine blades started pre-grounding in January. They are committed to casings another six months out.

The write up from Dominic Gates at ST ( https://www.seattletimes.com/business/b ... employees/ ) says:

For the 737’s global supply chain — which includes engine parts from the U.S and France, fuselages from Wichita, Kansas, and tail rudders from China—the stoppage in Renton is potentially very disruptive. But Boeing gave no information about how that will be handled.

Some major suppliers have contracts that require Boeing to continue to take delivery of their parts, and to pay for them. Others may have to suspend their own production.

So it could be that some of the bigger vendors providing major parts have contractual protection.

It's also interesting that the "pain" extends to China, who makes rudders for 737.

As an aside, I read that entire article and not once found a hint of the theory that production is being stopped because of some deeper flaw in the MAX.

This article comes from the same guy who has shown he has a broad network of contacts within Boeing and FAA.

I've also read reports from NYT, WaPo, CNBC, CNN, WSJ, AvWeek, etc and no one is floating the deeper flaw theory despite all the clicks it would generate.

If the deeper flaw does exist, I'm having a hard time seeing how the media would not have gotten wind of it by now.

I do find articles like the following, all saying the MCAS fix works and RTS is expected soon, including quotes from the EASA chief:
2175301 wrote:
Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."

IMO there is no need for a deeper theory than one that we are seeing reported, that Boeing has been saying for months now that if they could not RTS by end of the year they would consider halting production, and they chose to halt production because the actual situation with regard to them being able to predict the RTS time line is now worse than anticipated due to the decision to go with global RTS rather than US-first RTS.

I can imagine this is frustrating for insiders because of exactly what you say, the more people in the decision loop, the more difficult it is to get an agreement.

This thread shows a wide spectrum of concerns, and I'm sure the actual regulators who are experts in their field can come up with just as many if not more concerns, and with nothing motivating closure the process of addressing each concern being raised could go on indefinitely.

I think Boeing was willing to continue production as long as they had some confidence in the RTS procedure and time line, but once the CEO sat down with the new FAA chief such confidence was lost, and without that, there really was no other decision but to halt production.

I agree there is no need for a deeper theory. Boeing has become frustrated to not have a fixed goal. So they stand down.

Your link is interesting, but risk sharing partners, such as CFM, will share the pain. I'm certain casting and forging vendors refused risk sharing. Once material is ordered, Boeing, Spirit, UTX, Meggitt, British Aerospace, or CFM must pay the sub-vendor. Without knowing details of the risk sharing partners' contracts, I can only speculate.

So Boeing just motivated to close the process. I agree, they lost faith in the RTS process. The discussions today with the FAA will be very different thsn yesterday. No reduction in rigor, but at least a timeline to stop finding issues. A timeline to define requirements. Then Boeing could schedule RTS.

After 9 months of delays, many which were solved 4 or 5 months ago, is enough. It is the FAA's job to tell Boeing the requirements.

But because of jobs st Meggitt, British Aerospace, SAFRAN, and dozens (hundreds?) of other EU vendors, EASA will focus. I don't know if enough jobs are at risk in China to matter.

The end goal won't change, the time pressure will.

Lightsaber

Regulation/Requirements have not changed. It is for Boeing to demonstrate a compliant solution. If the solution presented is demonstrated not to be compliant, that is for Boeing to go away and fix it (this does not mean that the regulator does not give input and suggestion). If Boeing CEO has lost faith, it is in his own organisation that has failed to meet his objectives.

Ray
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:28 pm

scbriml wrote:
morrisond wrote:
They still had over $10 B cash on hand - which if they are cash flow positive going forward they will not have to use it.


Is the $6+ billion they set aside for customer compensation included in that $10 billion?


If it is set aside already then presumably no - but hard to parse that out of the statements. Most of that will most likely be new Order discounts or Delivery discounts, not an instant use of cash.

In any case - they can afford it.
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:30 pm

lightsaber wrote:
I didn't realize Spirit had gone to a 4-day work week with the grounding:

https://leehamnews.com/2019/12/17/minim ... down-seen/

That link notes this is a 3 to 6 month shutdown. The link also notes Boeing hasn't communicated with vendors yet.

I suspect Boeing wants to keep vendors ready for a ramp up post RTS. I wonder how many could drop to short workweeks?

The longer this goes on, the more Boeing must conserve cash.

Lightsaber


Boeing should be cash flow positive going forward with the stoppage in production.

That Scott Hamilton post is real flame bait.

He used an Old image of MAX changes over the NG - when you first look at - it seems like he is suggesting these are all the changes that need to be made to the MAX to make it compliant.
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:31 pm

XRAYretired wrote:
2175301 wrote:
XRAYretired wrote:


Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."

If I recall correctly the FAA head has stated that he will not allow certification of the aircraft until he personally is convinced it is safe.

Partial Deleted for readability: See above.

Have a great day,

No standards have changed. BitFlip requirement has been in place for decades. Just because you have not heard of it before does not mean it is new (except to the uninformed observer). MCAS added Hazardous/Catastrophic failure modes that were 'hidden' until exposed by the events and investigation. Boeing have so far failed to provide a compliant solution to the regulatory requirements that have existed for decades.

Ray


The odds of 5 specific bit flips from a cosmic ray event are so vanishingly small that they way exceed the regulations:

I posted long ago in this thread what I was told by my insider; and I don't recall exactly. But it went something like this: For this generation of computer chip (older chip designs are more bit flip resistance due to their wider circuitry and memory locations). 1 bit flips happens regularly enough to be observable in the records (we have data). 2 simultaneous bit flips are arguably within the required failure rate. 3 might possibly be within the regulatory required failure rate. 4 will be way beyond the regulatory failure rate. 5 simultaneous bit flips is so far beyond regulations to be statistically meaningless.

So, yes; the FAA forced a failure that is statistically way beyond anything the regulations required; and Boeing agreed to go along with it. For both the FAA and Boeing this was a "political" decision. Not a technical decision.

In this case, I believe we can say that standards were changed.

As for practical evidence: How many 737 classic and NG's have had major events due to a failure of the flight computers? What are the statistics of that.... It has to be well beyond the allowed statistical failure requirements otherwise Boeing would have upgraded the computers long ago (and not allowed to grandfather the computers).

Note the same practical argument can be applied to the the rudder cable failure scenario (and other cases): How many engine disintegrations have occurred that have cut a rudder control cable vs the number of hours and cycles of the 737 classics and NG. That gives you a historical failure rate (the very best evidence as it's not an estimate). Now increase that by 20-30% of the larger new engine. Are you within the allowed failure rate (and my guess is you are 1000 times better than the allowed failure rate). That is why you can grandfather the rudder cable design. Real historical evidence.

When discussing "grandfathering" the fist question that has to be asked is what is the current regulation trying to accomplish, and what does the historical data show. If historical data shows clear compliance with the intent of the current regulation there is no reason to look at other factors that can be considered in an argument for "grandfathering." If the historical data shows that you don't meet regulatory limits -there will not even be an attempt at "grandfathering." Only in the case where the historical data shows that you are "near" (or arguably near) the regulatory limit that other arguments might be considered (cost of modification, etc).

I do agree that the 737Max was reasonably grounded due to a problem with MCAS V 1. The evidence I have seen is that it was functionally fixed and tested by mid June 2019 with MCAS V 2.

I believe that Boeing made a good faith effort to go beyond with changing the computer structure for the extremely unlikely 5 simultaneous bit flip issue. However, that opened up all kinds of new areas beyond MCAS V 2 to be reviewed and approved... which leads to all kinds of new questions. I personally get the sense that much of the various questions related to software validation is in fact related to these other areas of flight control which were only opened up because the flight control computers were modified based on the 5 bit flips possibility (MCAS V 2 is a very simple software change).

The fact that apparently Boeing cannot even guess at what the timetable will be can only realistically exist because Boeing does not know what issues have yet to be resolved, and cannot make an educated guess about how long. Having worked with regulators - we have always been able to reasonably estimate how long something would take to resolve.

Have a great day,
Last edited by 2175301 on Tue Dec 17, 2019 4:36 pm, edited 1 time in total.
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:33 pm

XRAYretired wrote:
lightsaber wrote:
Revelation wrote:
The write up from Dominic Gates at ST ( https://www.seattletimes.com/business/b ... employees/ ) says:


So it could be that some of the bigger vendors providing major parts have contractual protection.

It's also interesting that the "pain" extends to China, who makes rudders for 737.

As an aside, I read that entire article and not once found a hint of the theory that production is being stopped because of some deeper flaw in the MAX.

This article comes from the same guy who has shown he has a broad network of contacts within Boeing and FAA.

I've also read reports from NYT, WaPo, CNBC, CNN, WSJ, AvWeek, etc and no one is floating the deeper flaw theory despite all the clicks it would generate.

If the deeper flaw does exist, I'm having a hard time seeing how the media would not have gotten wind of it by now.

I do find articles like the following, all saying the MCAS fix works and RTS is expected soon, including quotes from the EASA chief:

IMO there is no need for a deeper theory than one that we are seeing reported, that Boeing has been saying for months now that if they could not RTS by end of the year they would consider halting production, and they chose to halt production because the actual situation with regard to them being able to predict the RTS time line is now worse than anticipated due to the decision to go with global RTS rather than US-first RTS.

I can imagine this is frustrating for insiders because of exactly what you say, the more people in the decision loop, the more difficult it is to get an agreement.

This thread shows a wide spectrum of concerns, and I'm sure the actual regulators who are experts in their field can come up with just as many if not more concerns, and with nothing motivating closure the process of addressing each concern being raised could go on indefinitely.

I think Boeing was willing to continue production as long as they had some confidence in the RTS procedure and time line, but once the CEO sat down with the new FAA chief such confidence was lost, and without that, there really was no other decision but to halt production.

I agree there is no need for a deeper theory. Boeing has become frustrated to not have a fixed goal. So they stand down.

Your link is interesting, but risk sharing partners, such as CFM, will share the pain. I'm certain casting and forging vendors refused risk sharing. Once material is ordered, Boeing, Spirit, UTX, Meggitt, British Aerospace, or CFM must pay the sub-vendor. Without knowing details of the risk sharing partners' contracts, I can only speculate.

So Boeing just motivated to close the process. I agree, they lost faith in the RTS process. The discussions today with the FAA will be very different thsn yesterday. No reduction in rigor, but at least a timeline to stop finding issues. A timeline to define requirements. Then Boeing could schedule RTS.

After 9 months of delays, many which were solved 4 or 5 months ago, is enough. It is the FAA's job to tell Boeing the requirements.

But because of jobs st Meggitt, British Aerospace, SAFRAN, and dozens (hundreds?) of other EU vendors, EASA will focus. I don't know if enough jobs are at risk in China to matter.

The end goal won't change, the time pressure will.

Lightsaber

Regulation/Requirements have not changed. It is for Boeing to demonstrate a compliant solution. If the solution presented is demonstrated not to be compliant, that is for Boeing to go away and fix it (this does not mean that the regulator does not give input and suggestion). If Boeing CEO has lost faith, it is in his own organisation that has failed to meet his objectives.

Ray


Yes but the Regulations/Requirements can be waived or relaxed as they have many times before in certain cases. It is in the realm of possibility.
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:33 pm

Some quantification on impacts. For GE, cutting production from 52/month to 42/month cuts their revenue by $400 million per quarter:
https://www.bing.com/amp/s/www.wsj.com/ ... 1576587194

$400m/30 MAX is $13.3 million per missed delivered MAX. I'm not privy to the whole link, so I'll assume that that is GE/CFM's share for engine and nacelle per MAX. A bit more than I estimated before.

So that is about $4.5 million per MAX for SAFRAN (my estimate based on engine to nacelle costs), of course most passing through to vendors.

So this could hit SAFRAN to about $300 million in revenue per quarter. (I assume about a 50% production cut). As SAFRAN has 21 billion Euro in Revenue, if production is halved, they will be better off than I speculated before.

I wonder which vendors are most vulnerable? I do believe the bond rating at GE and SAFRAN should drop.

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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:36 pm

I heard on a business radio channel a woman (financial analyst) talking about how the 737 MAX was a great advance, more technologically advanced than its Airbus counterpart, that has gone bad. To be fair, she said she wasn't knowledgeable about the industry, but it seemed to me that she was confusing the 737 MAX and the 787.

Basically, this issue is tarnishing Boeing in general, because people don't know anything about planes.
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XRAYretired
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:41 pm

Ertro wrote:
XRAYretired wrote:
Amiga500 wrote:
I'm going on the basis there was supposedly test flights with EASA last week

Nop. EASA Cert Test Flight will be conducted on a certification configuration aircraft when the certification standard is established. This has not yet happened.


I find this the most baffling. Why cannot Boeing start co-operating with EASA?

The possibilities are:
1) Boeing wants keep the system where all preliminary test flights happen with FAA only.
I assume there has been numerous test flights already with FAA using various versions of preliminary SW already in the summer.
2) Boeing is still tweaking the aerodynamics trying to find something that makes the plane work close to okay without MCAS SW.
3) Boeing knows that the plane cannot be made so that it works even close to okay without MCAS so better not to let nobody know that.
4) Boeing knows that the certification is so far into future anyway so not starting to work with EASA is not going to delay the certication
5) Boeing wishes that EASA just forgets that they wanted to see how the baseline plane behaviour which happens it there is some malfunction to AoA or MCAS and they shut off.
6) Stopping production provides more shareholder value rather than starting to work towards EASA certification.
7) Boeing wants to put EASA into hard spot not co-operating when them and coming at them in the last minute saying:
"Okay now we got an approval from FAA and they want to grant the certification tomorrow so we have 15 minutes to work through all your concerns. Sorry it looks we have no time for your test flight and even if you have pilots ready in the next 15 minutes for the flight they better not come up with any concerns from that test flight because we have no time to fix them and because this was our final certification configuration we cannot even in theory make any changes to it any more as that would be a contradiction to us naming the configuration to be the final certification configuration. So let's drop the flight, okay?"
8) Boeing wants EASA first try to guess blindfolded what exactly is the situation where MAX behaves catastrophically. And only if they miss the guess and write test spec so that it does not touch the problematic situation then they allow the test flight. Boeing pilots are then making sure that they avoid going near the condition where all hell breaks loose. Zero free flying allowed like Boeing pilots did years ago to suddenly come to the conclusion that MCAS is absolutely needed also on slow speeds.

Those are about all the possibilities I can think of. What other possibilities there are?

2175301 wrote:
Actually, the "whisper" I got from my normally silent source is that is the problem. "We don't even know what the standards are - they keep changing."


Satire. Not to be taken seriously: So EASA on some days want to perform the approach to stall on 10 deg bank angle and on other days 15 deg bank angle. One of those is the one where MAX is uncontrollable and unless EASA decides on the other that is not showing the problem then we are not allowing them to fly. We hope EASA misses the condition to say that wild oscillations on stick are not allowed as nobody should reasonably assume those are a problem. In that case we can write to the test report that average stick forces measured over 2 second period are just within spec. The test spec mentioned nothing about wild oscillations so we don't have to report those.

It is within possibilities to write a spec that defines what is good and acceptable behaviour. But once that spec is broken and somebody needs to come up with some other spec that says that the behaviour is outside from good it is totally impossible to write a new spec consisting of not-good-but-somehow-acceptable behaviours when blindfolded not knowing what is the specific area and problematic condition one should consider their thinking.

Another possibility? You are trying to find complexity and conflict where there is none.

FAA/EASA/Boeing are in constant contact and are co-operating. EASA have a specific flight test programme that will be completed in due course when Boeing have managed to produce a compliant solution.

Ray
 
indcwby
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:41 pm

All the speculation being posted is making me laugh. Slowly turning into the aviation TMZ news.

737Max isn't going anywhere. It'll be back in the air. But I will say this may be the last 737 we see moving forward.
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par13del
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:43 pm

morrisond wrote:
Yes but the Regulations/Requirements can be waived or relaxed as they have many times before in certain cases. It is in the realm of possibility.

So you are also aware of all the requirements that Boeing's failed to meet in their November submission to the FAA?
 
bspc
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:48 pm

Some of the comments here are absolutely amazing! As if people spend time coming up with theories.

We all just need to accept that the problem seems to be bigger than a simple fix and Boeing is working with all parties involved around the world to get the aircraft flying again. There is nothing hiding, nobody is after anybody.

Don’t you want to fly in an aircraft that is safe? Safe in regards to the certification, not everybody’s individual definition of whether the aircraft is safe.
 
LDRA
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:49 pm

lightsaber wrote:
planecane wrote:
Boeing made that statement months ago. If a shutdown was going to happen, it was going to be immediate. There would be no point in ramping down or announcing a shutdown in March because it would make no sense if RTS happened during the ramp down or before the shutdown was to happen.

Part of the shutdown I'm sure is to get the attention of politicians. As long as Boeing was producing away and buying parts at the 52 per month rate from suppliers and agreeing to compensate customers (and, in some cases pilots), the only people getting harmed were Boeing shareholders and Boeing executives. That allowed the FAA and other regulators to literally take as much time as they wanted to. The shutdown won't lead to a rubber stamp approval but it will light a fire under the FAA especially to work more quickly and be more upfront with Boeing on exactly what they want for RTS.

This is a nice summary. Before, Boeing took all the pain of delays. With the clear communication that this will be a joint recertification, Boeing knows it will be a long time before RTS.

Boeing is listening. They are taking this seriously. But they just dumped the pain on their risk sharing partners and employees. Since no time will or can be given by the regulators, Boeing is standing down.

Everyone now knows this just ratcheted up in seriousness.

Some parts of this business cannot be just turned off. For example, CFM will receive the last rotors, shafts, and turbine blades started pre-grounding in January. They are committed to casings another six months out.

I'm trying to figure out how many people are directly employed on the MAX. If I estimate $100,000 per employee per year (low for Washington employees, high for Witchita), I estimate 125,000 to 150,000 employed directly by the MAX production.

One heck of a Christmas present for the industry. This is one of the two too big to fail projects in the industry.

Boeing won't lay off short term, but the demand for temporary work just went away (mostly).

Lightsaber


Key word: " too big to fail". Summarizes the situation
 
Babyshark
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:51 pm

indcwby wrote:

737Max isn't going anywhere.


That part is true.
 
Ertro
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:52 pm

XRAYretired wrote:
Another possibility? You are trying to find complexity and conflict where there is none.

FAA/EASA/Boeing are in constant contact and are co-operating. EASA have a specific flight test programme that will be completed in due course when Boeing have managed to produce a compliant solution.

Ray


There clearly is a conflict.

Boeing could easily have said that "Okay you want to see the bare metal plane fly like NG manages to do. We have no problem as we are not making any changes to the metal aerodynamics. Actually we cannot make changes as that would be totally silly while we keep manufacturing the planes in hundreds. We just to have to produce a totally noncompliant SW for this test that switches MCAS totally off. So this is the date, August 2nd and here is plane and pilots on this airfield. Give your flight test plan 24 hours in advance and we fly that unless we find some part of it problematic. Second flight test in September based on what further ideas you got from the first one" So clearly the EASA worries would be much less and so certification would be much easier in other parts as well."

Seems totally silly not to do this. It is totally counterproductive to let EASA sit half a year thinking that there must be something catastrophic as something so easy and sensible does not seem possible. Unless there is some other explanation where this is actually the best course of action.
 
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Revelation
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:57 pm

XRAYretired wrote:
Regulation/Requirements have not changed. It is for Boeing to demonstrate a compliant solution. If the solution presented is demonstrated not to be compliant, that is for Boeing to go away and fix it (this does not mean that the regulator does not give input and suggestion).

It may be interesting to note that early in this tragedy Boeing's CEO ordered a review of internal procedures and after it was completed he pronounced that all procedures were followed and all were in compliance. The unspoken part of this is that Boeing applied for exemptions in several cases, and were granted such, and in some of these cases the exemptions were granted by a delegated FAA representative who was a Boeing employee, or the exemptions were provided by FAA managers overruling FAA technical experts.

I would imagine the fear is that the international regulators will reexamine all these exemptions with the result being a much longer time line to RTS.

On the other hand, the links I provided suggested EASA and other authorities were comfortable with the MCAS solution and viewed RTS as likely in the near future.

Of course this all could be dissembling, or it could be undermined by new discoveries, but we haven't seen any source willing to go on the record asserting there are more issues to be addressed, and with all the media focus on these events it's pretty strange that none has been reported.
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par13del
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:57 pm

Ertro wrote:
Seems totally silly not to do this. It is totally counterproductive to let EASA sit half a year thinking that there must be something catastrophic as something so easy and sensible does not seem possible. Unless there is some other explanation where this is actually the best course of action.

I guess you missed the part where EASA said they would not be conducting any test flights until the FAA has finalized its certification.
 
morrisond
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:58 pm

par13del wrote:
morrisond wrote:
Yes but the Regulations/Requirements can be waived or relaxed as they have many times before in certain cases. It is in the realm of possibility.

So you are also aware of all the requirements that Boeing's failed to meet in their November submission to the FAA?


No I'm not - what are they?

I was referring to the infamous Transport Canada Employee email speculating on removing MCAS and just providing a waiver.
 
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seahawk
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:59 pm

morrisond wrote:
Boeing shares just turned positive on the day - Yes they are done as a going concern........

Investors don't seem to be fazed by this at all as I speculated on the previous page and will likely see it as a positive.


This is just the pressure needed to get the FAA to certify the plane in 2019. I think Boeing will get a nice Christmas present soon.
 
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lightsaber
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 4:59 pm

A bit more: SAFRAN isn't paid until aircraft delivery:

https://www.usnews.com/news/top-news/ar ... is-deepens

My take is as a risk sharing partner, they will discuss with Boeing the production rate and adjust as they estimate is best.

The above link has an analyst expecting Spirit to shut their line. As it is 50% of their business, I would expect 50% layoffs.

Boeing must now determine the realistic ramp rate (down and up) for production.

Many theories here. My experience with regulators is the more involved, the more churn. Boeing must meet FAA requirements, that is what they signed up for. The FAA is listening to other regulators.

I believe in Occams razor. The simplest theory is Boeing lost confidence in a quick return to service. From what I can tell, the June solution met regulations. Six months later, no reason to believe the MAX won't be grounded 6+ months. Time to preserve cash.

There will be reductions in work force. All temporary labor that can be reduced will be.

The MAX will be incredibly safe post this scrutiny.

The FAA sent a clear message to not expect a quick RTS. As soon as faith in a RTS within 4 months was lost, cash conservation is the only option.

Lightsaber
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skipness1E
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 5:00 pm

indcwby wrote:
All the speculation being posted is making me laugh. Slowly turning into the aviation TMZ news.
737Max isn't going anywhere. It'll be back in the air. But I will say this may be the last 737 we see moving forward.

*MAY*???? No serious commentator thinks otherwise, it's already end of line Be1900-like with flakey add ons territory.
I've never been on a a modern commerical jet that we didn't see moving forward, that's kinda their thang.

Whatever happens now, the program has the smell of death over it. Hundreds dead, the biggets grounding event in commercial aviation, 400 brand new aircraft currently unsafe for passenger operations, a regulator scared of being seen to be too compliant and a customer base that will be demanding frankly enormous discounts just to even think about topping up their fleets ASSUMING they ever get them flying again. The longer the grounding, the greater the shame and anger, this is like a cancer infecting Boeing, the company that peaked with the B777 and has lost it's way ever since.
 
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 5:03 pm

morrisond wrote:
lightsaber wrote:
I didn't realize Spirit had gone to a 4-day work week with the grounding:

https://leehamnews.com/2019/12/17/minim ... down-seen/

That link notes this is a 3 to 6 month shutdown. The link also notes Boeing hasn't communicated with vendors yet.

I suspect Boeing wants to keep vendors ready for a ramp up post RTS. I wonder how many could drop to short workweeks?

The longer this goes on, the more Boeing must conserve cash.

Lightsaber


Boeing should be cash flow positive going forward with the stoppage in production.

That Scott Hamilton post is real flame bait.

He used an Old image of MAX changes over the NG - when you first look at - it seems like he is suggesting these are all the changes that need to be made to the MAX to make it compliant.

It's interesting that the estimate is for the production stop to last 3-6 months.

That suggest the earliest date would be end of March, latest date end of June.

That's a pretty large amount of variation.

It supports the idea that no one really knows how long the shut down will be.

If there were some deeper aerodynamic issue needing to be resolved, I think the range would be a lot larger, along the lines of 12-24 months.
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seahawk
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 5:05 pm

There are no serious issues. And the line will not actually shut down. After the Christmas holidays all will be back to normal.
 
Peterwk146
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Re: Boeing 737MAX Grounded Worldwide Q4 2019, Production suspended

Tue Dec 17, 2019 5:06 pm

morrisond wrote:
XRAYretired wrote:
lightsaber wrote:
I agree there is no need for a deeper theory. Boeing has become frustrated to not have a fixed goal. So they stand down.

Your link is interesting, but risk sharing partners, such as CFM, will share the pain. I'm certain casting and forging vendors refused risk sharing. Once material is ordered, Boeing, Spirit, UTX, Meggitt, British Aerospace, or CFM must pay the sub-vendor. Without knowing details of the risk sharing partners' contracts, I can only speculate.

So Boeing just motivated to close the process. I agree, they lost faith in the RTS process. The discussions today with the FAA will be very different thsn yesterday. No reduction in rigor, but at least a timeline to stop finding issues. A timeline to define requirements. Then Boeing could schedule RTS.

After 9 months of delays, many which were solved 4 or 5 months ago, is enough. It is the FAA's job to tell Boeing the requirements.

But because of jobs st Meggitt, British Aerospace, SAFRAN, and dozens (hundreds?) of other EU vendors, EASA will focus. I don't know if enough jobs are at risk in China to matter.

The end goal won't change, the time pressure will.

Lightsaber

Regulation/Requirements have not changed. It is for Boeing to demonstrate a compliant solution. If the solution presented is demonstrated not to be compliant, that is for Boeing to go away and fix it (this does not mean that the regulator does not give input and suggestion). If Boeing CEO has lost faith, it is in his own organisation that has failed to meet his objectives.

Ray


Yes but the Regulations/Requirements can be waived or relaxed as they have many times before in certain cases. It is in the realm of possibility.


In my over 40 years of working in aerospace systems engineering, I have never heard of airworthiness regulations being waived or relaxed because they are the laws that you have to work to. You always have to demonstrate that you are compliant with them, otherwise the aircraft cannot be certified.

On the other hand, requirements defined by the OEM can be waived or relaxed so long as they don't compromise the means of compliance to the airworthiness regulations.

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