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rheinwaldner
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 7:42 pm

Revelation wrote:
Agrajag wrote:
Production may not re-start until 2021:

https://t.co/D7G4QcWt6I

A quote:

It could well remain shut down through September, analysts say, and perhaps through the end of the year, following the company’s announcement that it doesn’t expect to receive approval from the FAA for its bestselling plane to return to service till the summer.

IMO the article is click bait: unnamed analysts are used, and even then lots of imprecise language is being used. Pretty much a fact free spitballing approach, IMO.

The irony is, that clickbait articles predicted the future always better than e.g. Boeings own PR since this saga started.

Think about it: which clickbait article from the last year was totally wrong? Even if there are some, a large number was spot on or even was still underestimating the impact.
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kayik
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 7:42 pm

At Around 1:15 PM Boeing shares hit the bottom at $302. Five minutes after that 3 pieces of news were released and stock price rose to $312.


Boeing wants to resume production of 737 Max months before the planes return to service

Boeing CEO says return of 737 Max was delayed further because it recommended pilot simulator training

Boeing CEO: Will not suspend or cut dividend
 
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seahawk
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 7:43 pm

par13del wrote:
seahawk wrote:
par13del wrote:
Except MCAS happened on two occasions with fatal results and the bit flip has happened...................
So yes, I still believe that at the end of the day, bit flip will be the one that delayed or prevented RTS.


No, the RTS is delayed by Boeing making very optimistic judgement calls when defining how critical a MCAS failure would be.

So you are confirming the thoughts of others that the FAA is acting in a spiteful manner?

The majority of us accept that the FAA is the only one who has the authority to RTS the a/c, that Boeing presented dates in September, October, November 2019 etc. based on their best guess is just that, at no time before or after the tenure of last CEO did Boeing ever have the authority to grant RTS, that has always been the domain of the FAA.
I guess this became an issue to the new head of the FAA that he thought he had to tell Boeing to Shut Up because it undermined his authority.


Not at all. Boeing certified MCAS1.0 failure at a lower risk level than catastrophic, it now turns out that this was optimistic, so MCAS2.0 does not only have to fix the basic software errors but the whole system including all hardware has to meet the requirements for a system which has a catastrophic failure classification now.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 8:04 pm

kayik wrote:
Boeing CEO says return of 737 Max was delayed further because it recommended pilot simulator training



Now that makes a lot more sense than some of the theories floated around here.

It would take time to develop that training and how to implement it and get it approved.
 
889091
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 8:15 pm

At what point in time does 'short term' storage become 'long term' storage?

When Boeing parked the first bird, I suppose it is safe to assume that they didn't expect the grounding to drag on for as long as it has.

With no end date in sight, what preventative maintenance need to be done on those birds sitting in storage? I believe someone mentioned that the tyres need to be rotated to prevent them from becoming flat spotted. Jack plane up, rotate tyres. Job done. It gets a little more complicated/expensive when you multiply that by 400 airframes and possibly having to rotate the tyres every x weeks/months.

Anything else that needs to be added to the preventative 'to-do' list?
 
art
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 8:32 pm

If Boeing do not restart production until FAA approval of RTS is at least inevitable, can the entire suooly chain be revived in a timely manner? How many of those laid off will be available when their services are required again? I can imagine that quite a few will not be prepared to wait several months before being employed on MAX work again and will look for gainful employment elsewhere.
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 8:46 pm

rheinwaldner wrote:
Think about it: which clickbait article from the last year was totally wrong? Even if there are some, a large number was spot on or even was still underestimating the impact.

Its why I believe that a number of A.Net poster possess the same expertise as those who wrote those click bait articles, hence the reason why this is the site to go to.
 
beechnut
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 8:49 pm

art wrote:
If Boeing do not restart production until FAA approval of RTS is at least inevitable, can the entire suooly chain be revived in a timely manner? How many of those laid off will be available when their services are required again? I can imagine that quite a few will not be prepared to wait several months before being employed on MAX work again and will look for gainful employment elsewhere.


It depends, I think, if suppliers stockpiled parts after the shutdown. Sprit, for instance, has a backlog of fuselages in storage, so theoretically they can start supplying Boeing again as soon as the line fires up again. Then while that happens they can ramp up their own production line to begin making new fuselages. It will depend on what the other suppliers have done, how much inventory of various items they have on site, etc.

But it will take time to ramp back up to full normal production. IMHO the real worry is if a strategic supplier goes bankrupt in the interim. Then a new supplier has to be found and certified, and that increases the delay (and risk).

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Revelation
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 8:56 pm

art wrote:
If Boeing do not restart production until FAA approval of RTS is at least inevitable, can the entire suooly chain be revived in a timely manner? How many of those laid off will be available when their services are required again? I can imagine that quite a few will not be prepared to wait several months before being employed on MAX work again and will look for gainful employment elsewhere.

As per the news thread, the CEO is saying it will restart a few months before June:

Revelation wrote:
Reuters: Boeing CEO says he expects to resume 737 MAX production before mid-year

No specific dates, but "a few months before June" seems to be the take-away.

Calhoun declined to provide a specific date for resumption of production, but said it “will be reinvigorated months before that moment in June because we have to get that line started up again.” He also said the company would make some changes to the 737 MAX production line to make it more efficient.

The CEO said the company “will slowly, steadily bring our production rate up a few months before that date in the middle of the year.” He said the company was not planning to lay off any employees because of the latest delay in the MAX.

Lots of other stuff in the article, including him saying MAX won't be scrapped and it will fly for a generation, the dividend will be paid, he did not see recent issues raised about wiring or software as “serious problems", and NMA team starting with a "clean sheet of paper".

I guess anyone's guess is good about how long workers will wait to see if their jobs are still tenable.

I would suggest Boeing has done no layoffs and many of the places where subcontractors operate provide unemployment benefits.

Some may see it as an unfortunate and unplanned gap in employment but think it's worth hanging on to get their jobs back.

Some may see it essentially as an unpaid or underpaid vacation.

Others may be ready for a change and this is giving them the opportunity to act on that urge.

Time will tell.
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 8:59 pm

seahawk wrote:
par13del wrote:
seahawk wrote:

No, the RTS is delayed by Boeing making very optimistic judgement calls when defining how critical a MCAS failure would be.

So you are confirming the thoughts of others that the FAA is acting in a spiteful manner?

The majority of us accept that the FAA is the only one who has the authority to RTS the a/c, that Boeing presented dates in September, October, November 2019 etc. based on their best guess is just that, at no time before or after the tenure of last CEO did Boeing ever have the authority to grant RTS, that has always been the domain of the FAA.
I guess this became an issue to the new head of the FAA that he thought he had to tell Boeing to Shut Up because it undermined his authority.


Not at all. Boeing certified MCAS1.0 failure at a lower risk level than catastrophic, it now turns out that this was optimistic, so MCAS2.0 does not only have to fix the basic software errors but the whole system including all hardware has to meet the requirements for a system which has a catastrophic failure classification now.

Like I said, we are still talking about MCAS 1.0 when Boeing is at MCAS 2.0 and what we know they have been working on namely bit flip is not MCAS but the result of....so the coding taking place for multiple computer use does not change the code they made for MCAS 2.0, now they are checking AOA failure, slow spin up rate, etc etc etc...but I will let this one go, MCAS is what it is.
 
mwananchi
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 9:00 pm

Chemist wrote:
This is going to make a hell of a Harvard Business Review Case Study series one day.


And the case looks certain to generate teachable and examinable material for any number of (mostly MBA) courses for decades to come.

The corporate communications academics for a start, maybe something about crisis management and the use of newer channels.

The decision analysis people might want to teach their students about which biases led which people astray at key moments.

The marketing guys will now have aircraft industry examples to illustrate the marketing mix.

Most of all, the ethics and strategy professors will have their classes listening in pin-drop silence as the case narrative gradually unfolds and the massive downstream consequences of a sequence of choices are made clear.
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 9:11 pm

art wrote:
If Boeing do not restart production until FAA approval of RTS is at least inevitable, can the entire suooly chain be revived in a timely manner? How many of those laid off will be available when their services are required again? I can imagine that quite a few will not be prepared to wait several months before being employed on MAX work again and will look for gainful employment elsewhere.

At present, the FAA is wearing its safety hat so I think they will not be looking at such issues until after they have come to a decision on all MAX safety issues.

Boeing has almost 9 months of production sitting down, my opinion is that they will wait to see how long it takes them to get 1 frame ready for delivery before making a firm commitment on when to restart the line and how soon to ramp up.If we here talk of a dummy run before official RTS they may be checking times.

The FAA now has to certify each individual a/c, and with a/c at multiple sites, either Boeing has to take the FAA inspectors to the a/c or bring the a/c
to the inspectors, that in an of itself will add time to the delivery schedule.
In addition, the FAA may also need to re-certify a/c already delivered to airlines that they have stored at different sites, nothing on that score as of yet, perhaps when closer to RTS.

The US job market is tight, so workers may not be able to find jobs that easily, at least not ones that they want to be permanent.
 
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Revelation
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 9:16 pm

mwananchi wrote:
Most of all, the ethics and strategy professors will have their classes listening in pin-drop silence as the case narrative gradually unfolds and the massive downstream consequences of a sequence of choices are made clear.

Some place in that narrative you'll have to fit Muilenberg leaving after clearing $60M and the stock bouncing back after Calhoun announces the dividend will still be paid, without mentioning they are reportedly going back to the market for another $10B to wallpaper over the big hole in the finances.
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beechnut
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 9:31 pm

I guess Boeing managers never read the Johnson & Johnson case study on how to manage a crisis.

Beech
 
hivue
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 10:17 pm

Revelation wrote:
Revelation wrote:
Reuters: Boeing CEO says he expects to resume 737 MAX production before mid-year

No specific dates, but "a few months before June" seems to be the take-away.

Calhoun declined to provide a specific date for resumption of production, but said it “will be reinvigorated months before that moment in June because we have to get that line started up again.” He also said the company would make some changes to the 737 MAX production line to make it more efficient.

The CEO said the company “will slowly, steadily bring our production rate up a few months before that date in the middle of the year.” He said the company was not planning to lay off any employees because of the latest delay in the MAX.

Lots of other stuff in the article, including him saying MAX won't be scrapped and it will fly for a generation, the dividend will be paid, he did not see recent issues raised about wiring or software as “serious problems", and NMA team starting with a "clean sheet of paper".


Also --
He said the company should have not have repeatedly revised the plane’s forecasted return. “It was hard for anybody to trust us,” Calhoun said.

Presumably he wants people to trust them now. So then we can take the June/July RTS to the bank? Why would he be so confident of his prediction when all of Boeing's previous predictions have proved wrong?

Calhoun said the company is not considering scrapping the MAX and expects it will continue to fly for a generation.

So they are stuck with the MAX for 20+ years? Or are they going to compete with themselves --
He also disclosed Boeing is starting with a “clean sheet of paper” on a New Midsize Airplane but it is not clear if the company is scrapping the existing design.
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TTailedTiger
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 10:17 pm

Revelation wrote:
par13del wrote:
Except that after the November delivery the engineers were not working, it was the "paper pushers" who document the changes who were tasked with reformatting and ensuring everything was as the FAA expected.

Now in the past couple weeks, we had the issue of one of the alternate computers that must now run simultaneously not spinning up as fast as it should. I would say related to the outcome of the bit flip testing.

From what I read this was found via the software audit held at Collins in Iowa.

par13del wrote:
The irony in all this is that MCAS 2.0 was delivered in June, we have heard nothing about its failure, we have progressed way beyond MCAS to other areas of the company and the aircraft yet all we still discuss is MCAS in relation to making the a/c safe to fly. The bit flip testing and the FAA and EASA recommendations as a result may eventually turn out to be a bigger boogie man in the RTS than the object which actually caused the fatal crashes.

It seems the very next item to be addressed in the milestone graphic we had earlier in this thread was the line pilot evaluation, which pointed out that line pilots were able to recover from a MCAS scenario but were using different approaches to doing so. This in essence was a failed test. It showed the training regime was not producing the desired outcome.

I presume this and the JOEB training requirements have driven the decision to require sim training, and along with that, a general scrubbing of the checklists. Sorting all this out is what I presume extended the time line out by several months. It's all very subjective and thus very hard to predict how long it will take, so they just bumped out the timeline several months with what I presume is a low degree of confidence in it finishing on any particular date.

We also have the issues rising from the FAA asking Boeing to change the 3 second reaction time to 15 seconds, namely the hypothetical short circuit forcing the stab to activate. Maybe this should be viewed as a new activity on the timeline?

Based on a lack of information otherwise, I presume the software audit also is in essence a failure because it found the issue with display state at startup that was not handled properly. Unfortunately none of the media reports really addressed the rest of the software audit so we don't know if they just found this one issue and stopped or if they kept working and found 0..N more issues. It also isn't represented by its own box on the timeline.

Every attempt to step forward seems to have resulted in a step sideways.

It seems if DM wasn't fired back in December due to FAA Administrator calling him on the carpet, he certainly would have been fired by now. The strategy he and his now retired corporate chief legal counsel decided to follow has now been shown to be financially and reputationally ruinous. The latest slip now shows the customers will get three different seasonal peaks in traffic with MAX grounded. They must be ready to burn DM in effigy.

For reference, here's the milestone/timeline diagram:

Image


Scrubbing the checklists is all fine and well but if pilots won't use them then it's all for nothing.
 
hivue
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 10:24 pm

par13del wrote:
The FAA now has to certify each individual a/c, and with a/c at multiple sites, either Boeing has to take the FAA inspectors to the a/c or bring the a/c
to the inspectors, that in an of itself will add time to the delivery schedule.


The FAA will do this up to a PR-acceptable point, then say, "OK, Boeing seems to have learned their lesson and are good boys and girls now so we're stepping back from inspection of each and every grounded airplane before it returns to service and letting them take care of it" It's not likely the FAA has the resources to do this for all the grounded air frames in any kind of reasonable time frame.
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TaromA380
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 10:48 pm

Revelation wrote:
hivue wrote:
So if Muilenberg had been fired last Summer or early Fall the MAX would be back flying by now? I don't think so.

If Muilenberg had never even been CEO, JT and ET would not have happened? I don't think so.

The BoD let him go for specific cause, not to make him a scapegoat for this whole sorry mess. We shouldn't be looking for scapegoats either.

My comments point out that DM was in charge of the strategy chosen to deal with both crashes.

I think it's fair speculation to suggest that if DM had taken a different approach after the first crash we could very well have had RTS pretty much when the MCAS 2.0 fix was ready which some suggest was just a few weeks after the 2nd crash in April 2019.

Why? Well if the fix was ready in April clearly someone within Boeing knew it was a serious problem. Clearly the JT data showed multiple MCAS activations and anyone understanding the ramifications would soon realize a single bad AoA sensor triggered a set of actions that the crew wasn't able to deal with. Sure, maybe another crew could have done better, but surely MCAS also should have been implemented better too.

It seems to me the decision to use bravado and evasion was made at the executive level right after the first crash, which little internal investigation as to how likely or unlikely it was that there was a serious problem.

His Congressional testimony showed little evidence that he understood the ramifications of the idea that his company had serious shortcomings with regard to how MCAS was categorized, designed, developed, implemented and tested.

It seemed he was happy to delegate, believe the best, and stay clear of the blowback.

With great rewards come great responsibilities.


That DM's strategy looks like an epic fail, we know by hindsight.

One year ago, he took a bet, kind of “betting the company”, that the “too big to fail” mantra, along with big friends, will save the Max from grounding or, if things go really wrong, will quickly allow its RTS no matter what.

I suppose he took such a bet based on internal knowledge and anticipation that once grounded for a long period fo time, the Max program will be badly badly toasted. Losing his bet would cost what, six additional months of agony? Not a huge difference in the big scheme of things. On the other side, winning his bet would have been the most genial and rewarding bluff in history (yet to remain secret).

There is no moral in economics. DM really assumed responsibility in corporate terms (which aren’t our armchair generals’ terms) and went to fight back trying to stop the monster at the company’s gate by continuing bluffing, trying one last trick to save the day. It didn’t work, but at least “he died trying” like his function required it. He was getting paid to do this and he deserved every million he got.

I consider what we saw after the two crashes as mostly bluffs, the real decision and action vectors being behind the curtain but easy to understand if we analyze the situation without emotions. Media is telling us emotional stories, not what's really happening.

It must be sorrowful to dearly hope that you are too big to fail, only to discover …



Otherwise, with time passing by, soon should arrive the final report of ET crash.
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 11:23 pm

hivue wrote:
par13del wrote:
The FAA now has to certify each individual a/c, and with a/c at multiple sites, either Boeing has to take the FAA inspectors to the a/c or bring the a/c
to the inspectors, that in an of itself will add time to the delivery schedule.


The FAA will do this up to a PR-acceptable point, then say, "OK, Boeing seems to have learned their lesson and are good boys and girls now so we're stepping back from inspection of each and every grounded airplane before it returns to service and letting them take care of it" It's not likely the FAA has the resources to do this for all the grounded air frames in any kind of reasonable time frame.

Hmm...be careful, the last person giving their opinion of what the FAA would / could do got tossed...
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Wed Jan 22, 2020 11:49 pm

hivue wrote:
Calhoun said the company is not considering scrapping the MAX and expects it will continue to fly for a generation.

So they are stuck with the MAX for 20+ years? Or are they going to compete with themselves --

I'm sure that is the "plan of record" for now, there is no other viable path to follow in the near term.

I think it's pretty clear they will have to be pretty proactive about replacing MAX sooner than 20 years from now.

Clearly they are going to have to move to a much more automated cockpit than 737 has and doing so will mean no more common type rating.

Exactly when they chose to do so is going to be a big mystery for commercial reasons, but clearly it's sooner than 20 years from now.

Since the iPhone was invented in 2007 it's pretty clear we seeing new entrants who had smartphones as youngsters, and pretty soon it'll be ones who had one as toddlers.

It's not sensible to expect them to deal with cockpits with low levels of automation, training costs will be too high.

TTailedTiger wrote:
Scrubbing the checklists is all fine and well but if pilots won't use them then it's all for nothing.

That's why they are doing things such as line pilot evaluations to figure out what pilots actually do. In an ideal word this upcoming mandatory sim time would include an evaluation of the pilot's ability to incorporate what they learn.

TaromA380 wrote:
That DM's strategy looks like an epic fail, we know by hindsight.

One year ago, he took a bet, kind of “betting the company”, that the “too big to fail” mantra, along with big friends, will save the Max from grounding or, if things go really wrong, will quickly allow its RTS no matter what.

I suppose he took such a bet based on internal knowledge and anticipation that once grounded for a long period fo time, the Max program will be badly badly toasted. Losing his bet would cost what, six additional months of agony? Not a huge difference in the big scheme of things. On the other side, winning his bet would have been the most genial and rewarding bluff in history (yet to remain secret).

There is no moral in economics. DM really assumed responsibility in corporate terms (which aren’t our armchair generals’ terms) and went to fight back trying to stop the monster at the company’s gate by continuing bluffing, trying one last trick to save the day. It didn’t work, but at least “he died trying” like his function required it. He was getting paid to do this and he deserved every million he got.

I consider what we saw after the two crashes as mostly bluffs, the real decision and action vectors being behind the curtain but easy to understand if we analyze the situation without emotions. Media is telling us emotional stories, not what's really happening.

It must be sorrowful to dearly hope that you are too big to fail, only to discover …



Otherwise, with time passing by, soon should arrive the final report of ET crash.

As I wrote earlier, I'm more inclined to believe he simply did not dig very deeply and preferred to defer to underlings. This is my impression after watching his Congressional testimony.

I know a CEO has to rely on underlings, but there are times where the CEO has to recognize that a situation presents a huge risk to the future of the company and do what it takes to get to the bottom of it.

Ironically he is a trained engineer so he should have had the skills and the instincts he needed, but it seems he was happy to sit in Chicago and delegate to others.
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kayik
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 12:17 am

TaromA380 wrote:
That DM's strategy looks like an epic fail, we know by hindsight.

One year ago, he took a bet, kind of “betting the company”, that the “too big to fail” mantra, along with big friends, will save the Max from grounding or, if things go really wrong, will quickly allow its RTS no matter what.

I suppose he took such a bet based on internal knowledge and anticipation that once grounded for a long period fo time, the Max program will be badly badly toasted. Losing his bet would cost what, six additional months of agony? Not a huge difference in the big scheme of things. On the other side, winning his bet would have been the most genial and rewarding bluff in history (yet to remain secret).

There is no moral in economics. DM really assumed responsibility in corporate terms (which aren’t our armchair generals’ terms) and went to fight back trying to stop the monster at the company’s gate by continuing bluffing, trying one last trick to save the day. It didn’t work, but at least “he died trying” like his function required it. He was getting paid to do this and he deserved every million he got.

I consider what we saw after the two crashes as mostly bluffs, the real decision and action vectors being behind the curtain but easy to understand if we analyze the situation without emotions. Media is telling us emotional stories, not what's really happening.

It must be sorrowful to dearly hope that you are too big to fail, only to discover …



Otherwise, with time passing by, soon should arrive the final report of ET crash.


It is the same strategy they stick to with a new angle (we are very transparent now). It is all about share value. It must be very tiring to come out with something positive every single day to keep the share prices up, like they did today. DM was doing the same thing with RtS dates, but he lost face, nobody liked him, he was not likable anyway. Do you think DM decided by himself to keep producing to build this enormous inventory in order to corner FAA for a quick certification? It was a board decision and Calhoun was there.

29th is getting closer. The auditors are forcing them to provide for any foreseeable losses related to grounding, including lawsuits from victims' families which is open ended. We will see lots of dancing for a week.

...and the change of tone from "we will be certified by..." to "we don't think we will be certified before..." is very amusing.
Last edited by kayik on Thu Jan 23, 2020 12:21 am, edited 1 time in total.
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 12:19 am

https://www.seattletimes.com/business/b ... estore-it/ has Seattle Time's take on Calhoun's presser given today at the BCA campus in Seattle.

While acknowledging that the design of the MAX’s new flight control system was flawed, he insisted that was not a product of any deliberate decision to put some cost factor ahead of safety.

Instead, he said, the flaws came from longstanding assumptions about how pilots would react to a failure—assumptions that proved fatally wrong.

So he's doubling down on the idea that Boeing simply made a mistake believing that the pilots would treat MCAS as a runaway stabilizer, rather than admitting that the financial goals created an environment where all the evaluations were made with a strong bias towards ensuring that no sim training was needed.

Though that process “should have had more light shone on it,” Calhoun said “I didn’t see at any stage in that process … nor did anyone else … an issue of a trade of safety for something else.”

Why wasn't that light shone? Well, maybe because everyone was biased towards avoiding costly analysis, testing and changes to the airplane that might trigger a requirement of sim time?

Asked about damaging exchanges recently disclosed between pilots working to certify the MAX simulators, Calhoun referred to those involved as “a micro-culture,” not representative of Boeing.

The two employees, Chief Technical Pilot Mark Forkner and his deputy Patrik Gustavsson, spoke disparagingly and crudely in instant message and email exchanges about suppliers and airline officials as well as Boeing colleagues and the MAX airplane.

“This was a very unusual group of folks using horrible language,” Calhoun said.

So, is he saying he knows this to be true because there has been an investigation, or he merely hopes that this is true?
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kayik
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 12:28 am

Revelation wrote:
https://www.seattletimes.com/business/boeing-aerospace/new-boeing-ceo-calhoun-says-employee-confidence-is-shaken-my-job-is-to-restore-it/ has Seattle Time's take on Calhoun's presser given today at the BCA campus in Seattle.

While acknowledging that the design of the MAX’s new flight control system was flawed, he insisted that was not a product of any deliberate decision to put some cost factor ahead of safety.

Instead, he said, the flaws came from longstanding assumptions about how pilots would react to a failure—assumptions that proved fatally wrong.

So he's doubling down on the idea that Boeing simply made a mistake believing that the pilots would treat MCAS as a runaway stabilizer, rather than admitting that the financial goals created an environment where all the evaluations were made with a strong bias towards ensuring that no sim training was needed.

Though that process “should have had more light shone on it,” Calhoun said “I didn’t see at any stage in that process … nor did anyone else … an issue of a trade of safety for something else.”

Why wasn't that light shone? Well, maybe because everyone was biased towards avoiding costly analysis, testing and changes to the airplane that might trigger a requirement of sim time?

Asked about damaging exchanges recently disclosed between pilots working to certify the MAX simulators, Calhoun referred to those involved as “a micro-culture,” not representative of Boeing.

The two employees, Chief Technical Pilot Mark Forkner and his deputy Patrik Gustavsson, spoke disparagingly and crudely in instant message and email exchanges about suppliers and airline officials as well as Boeing colleagues and the MAX airplane.

“This was a very unusual group of folks using horrible language,” Calhoun said.

So, is he saying he knows this to be true because there has been an investigation, or he merely hopes that this is true?


So, the mistake was simple but the language is horrible. That translates into we can kill 346 people but we can't use that language.
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 12:58 am

The ST link above gives us more insights from the CEO:

He said company and external investigations into the MAX crashes have “pointed to an assumption that was made with respect to pilot behavior and a set of failure analyses that were wrong.”

Is admission of mistakes in failure analysis a new admission?

Boeing’s formal system safety analysis of the flight control software implicated in the crashes—the Maneuvering Characteristics Augmentation System (MCAS)—assumed the pilots would recognize what was wrong if it failed and counter it manually within four seconds.

“It was a judgment everybody wishes they hadn’t made,” Calhoun said. He added that various processes and procedures should have highlighted the central significance of that judgement for MAX program leaders, “but that’s not what happened.”

He said he and the rest of the board were unaware of the problems “until too late in the game.”

Another new admission, that "program leaders" did not understand the significance of the judgments being made?

Yet we know at least one "program leader" fully understood the significance of no sim time mandate.

Interesting that these things are attributed to internal investigations. Maybe Congress needs another set of hearings?

Maybe Calhoun's new transparency will lead to more subpoenas?
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 1:29 am

Revelation wrote:

“This was a very unusual group of folks using horrible language,” Calhoun said.

So, is he saying he knows this to be true because there has been an investigation, or he merely hopes that this is true?



D. Calhoun seems to be a diplomat but in reality (I am going to the dark side and I would stay there), that the FAA is really monkeys in ties incapable of certifying an aircraft!

At the rate that it, it will not be until next September or October or 2022. I UNDERSTAND the exchange of employee emails now.

The FAA is zealous it is an anvil, a disaster for everyone!

They are there cause of this crisis while Boeing had,

- Identified the problem,
- Solved it,
- Made concession to pass in simulators

... And the FAA takes the nap (AGAIN) after having ingested some bananas at lunch...
Last edited by Checklist787 on Thu Jan 23, 2020 1:54 am, edited 3 times in total.
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 1:39 am

Checklist787 wrote:
Revelation wrote:

“This was a very unusual group of folks using horrible language,” Calhoun said.

So, is he saying he knows this to be true because there has been an investigation, or he merely hopes that this is true?



D. Calhoun seems to be a diplomat but in reality (I am going to the dark side and I would stay there), that the FAA is really monkeys in ties incapable of certifying an aircraft!

At the rate that it, it will not be until next September or October or 2022. I UNDERSTAND the exchange of employee emails now.

The FAA is zealous it is an anvil, a disaster for everyone!

They are there cause of this crisis since Boeing identified the problem, solved it, made concession to pass in simulators and the FAA takes the nap after having ingested some bananas at lunch...

Interesting theory, but I don't see how the quoted context takes you there.
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 1:44 am

Revelation wrote:
https://www.seattletimes.com/business/boeing-aerospace/new-boeing-ceo-calhoun-says-employee-confidence-is-shaken-my-job-is-to-restore-it/ has Seattle Time's take on Calhoun's presser given today at the BCA campus in Seattle.

While acknowledging that the design of the MAX’s new flight control system was flawed, he insisted that was not a product of any deliberate decision to put some cost factor ahead of safety.

Instead, he said, the flaws came from longstanding assumptions about how pilots would react to a failure—assumptions that proved fatally wrong.

So he's doubling down on the idea that Boeing simply made a mistake believing that the pilots would treat MCAS as a runaway stabilizer, rather than admitting that the financial goals created an environment where all the evaluations were made with a strong bias towards ensuring that no sim training was needed.

Though that process “should have had more light shone on it,” Calhoun said “I didn’t see at any stage in that process … nor did anyone else … an issue of a trade of safety for something else.”

Why wasn't that light shone? Well, maybe because everyone was biased towards avoiding costly analysis, testing and changes to the airplane that might trigger a requirement of sim time?

Asked about damaging exchanges recently disclosed between pilots working to certify the MAX simulators, Calhoun referred to those involved as “a micro-culture,” not representative of Boeing.

The two employees, Chief Technical Pilot Mark Forkner and his deputy Patrik Gustavsson, spoke disparagingly and crudely in instant message and email exchanges about suppliers and airline officials as well as Boeing colleagues and the MAX airplane.

“This was a very unusual group of folks using horrible language,” Calhoun said.

So, is he saying he knows this to be true because there has been an investigation, or he merely hopes that this is true?


Good points.

Or it's that as they had so much else going on at the time (787,777X), the team working on the 737 MAX as it was viewed as a minor derivative would most likely have been the B team (or even C team) and quite probably not representative of Boeing's best work. This was most likely compounded by the ever contracting/expanding engineering team at Boeing.

It's one of the dangers of overcommitting to too many new programs at once you get "Unusual Groups of People" - doing critical safety work. That is not a good thing.
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 1:52 am

Revelation wrote:
Checklist787 wrote:
Revelation wrote:

“This was a very unusual group of folks using horrible language,” Calhoun said.

So, is he saying he knows this to be true because there has been an investigation, or he merely hopes that this is true?



D. Calhoun seems to be a diplomat but in reality (I am going to the dark side and I would stay there), that the FAA is really monkeys in ties incapable of certifying an aircraft!

At the rate that it, it will not be until next September or October or 2022. I UNDERSTAND the exchange of employee emails now.

The FAA is zealous it is an anvil, a disaster for everyone!

They are there cause of this crisis since Boeing identified the problem, solved it, made concession to pass in simulators and the FAA takes the nap after having ingested some bananas at lunch...

Interesting theory, but I don't see how the quoted context takes you there.


About to "the horrible language of pilots" of the D. Calhoun's quote about employes (FAA are monkeys)

In reality this is absolutely true.
D. Calhoun knows this but remains just a diplomat about the FAA... :geek:
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 2:04 am

kayik wrote:
So, the mistake was simple but the language is horrible. That translates into we can kill 346 people but we can't use that language.

I'd translate it as "the urge to scapegoat the idiot who drinks too much and sends problematic emails is too strong for us to resist".

Checklist787 wrote:
About to "the horrible language of pilots" of the D. Calhoun's quote about employes (FAA are monkeys)

In reality this is absolutely true.
D. Calhoun knows this but remains just a diplomat about the FAA... :geek:

The quote from the text dump was the 737 "airplane is designed by clowns, who are in turn supervised by monkeys" and was from a Boeing employee so IMO is not a reference to the FAA.
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 2:11 am

Revelation wrote:
kayik wrote:
So, the mistake was simple but the language is horrible. That translates into we can kill 346 people but we can't use that language.

I'd translate it as "the urge to scapegoat the idiot who drinks too much and sends problematic emails is too strong for us to resist".

Checklist787 wrote:
About to "the horrible language of pilots" of the D. Calhoun's quote about employes (FAA are monkeys)

In reality this is absolutely true.
D. Calhoun knows this but remains just a diplomat about the FAA... :geek:

The quote from the text dump was the 737 "airplane is designed by clowns, who are in turn supervised by monkeys" and was from a Boeing employee so IMO is not a reference to the FAA.


Well let's add other monkeys to the list :bigthumbsup:
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 2:12 am

Revelation wrote:
The quote from the text dump was the 737 "airplane is designed by clowns, who are in turn supervised by monkeys" and was from a Boeing employee so IMO is not a reference to the FAA.

I tend to agree on that.
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 3:13 am

Asiaflyer wrote:
virage wrote:
Chemist wrote:
This is going to make a hell of a Harvard Business Review Case Study series one day.


Yes, but it won't make an iota of difference so long as the Market rewards quarterly performance.

It is soon enough of bad stuff for a whole MBA program and its getting worse by the week.

Too easy to balme on quarterly performance only. Much of what has happened is due to poor decisions on multiple management levels and lack of internal transparency of processes and its roles in the bigger picture. Pressure and demand from Sales department to compete with competitors often has a significant impact on quality and design as well.


Yes it’s definitely a lack of long-term vision at the corporation at multiple levels. They let some golden opportunities slip right through their fingers. Such as when Bombardier was shopping the C300 for partners went to Boeing first. Imagine if.. would have had a ready made 737 replacement all modern and sorted out. Airbus would be under pressure from their NEO, which was why not quite enough and Boeing would be redesigning something in the 757 category to complement it. Airbus would then be squeezed in the middle between both products.

As for Bombardier, I’m sure that they are ultimately happier to be partnered with Airbus than Boeing.
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 4:13 am

snasteve wrote:
As for Bombardier, I’m sure that they are ultimately happier to be partnered with Airbus than Boeing.

Not really, BBD just said in their year end financial announcements that they are reconsidering their partnership in ACLP so there is no happiness for BBD to be had these days. Keep in mind that BBD offered the CS program to Boeing and Airbus twice each, and the only time they got acceptance was when they offered to give 50% share and board control to Airbus for $1. It always was going to end in tears for BBD and its investors. Maybe they can be proud of producing the C Series, but other than that, it looks like they will get no benefit from it after pouring many years and many billion dollars into the program.
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 5:51 am

Revelation wrote:
Checklist787 wrote:
Revelation wrote:

“This was a very unusual group of folks using horrible language,” Calhoun said.

So, is he saying he knows this to be true because there has been an investigation, or he merely hopes that this is true?



D. Calhoun seems to be a diplomat but in reality (I am going to the dark side and I would stay there), that the FAA is really monkeys in ties incapable of certifying an aircraft!

At the rate that it, it will not be until next September or October or 2022. I UNDERSTAND the exchange of employee emails now.

The FAA is zealous it is an anvil, a disaster for everyone!

They are there cause of this crisis since Boeing identified the problem, solved it, made concession to pass in simulators and the FAA takes the nap after having ingested some bananas at lunch...

Interesting theory, but I don't see how the quoted context takes you there.


He didn't need it.
That kite was going to get flown whichever way the wind was blowing.
"Anyone but Boeing" …...

You and I both have a good idea that the FAA got their heads around "There's no way we're going to get caught out like that again" a lot quicker than Boeing seem to have.
Having lost the trust of the FAA, Boeing are going to have to rebuild it.
And in my experience that means bending over and taking it where the sun don't shine, with a smile on your face, until the trust is restored - a process that takes years.

Unfortunately for some A-netters, the FAA have to rebuild trust too, and got on the agenda a lot quicker than Boeing have.
Boeing are not victims here of anything other than their own actions.

I saw Boeing forwarding all of the "clowns and monkeys" documents voluntarily to the FAA, and Calhoun backing off from optimistic forecasts of return to service that seemed at odds with the FAA as signs that the corner was being turned.
His "it is all Forkner's fault" strap line doesn't fill me with as much confidence though.
We'll have to wait and see, I guess
Rgds
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 7:06 am

TTailedTiger wrote:
flipdewaf wrote:
TTailedTiger wrote:

Oh ok. So bad pilots and bad maintenance are a fact of life we must deal with but it is unacceptable to have a flawed aircraft design. Got it.


No, that's a strawman. 'Bad' is an opinion with no measurable quantity implied which one could also describe and excellent but not quite perfect with the exact same level of truthfulness. All aircraft are also flawed but it is the level of flaws that we must assess and manage.

The aviation transport system as a whole (without the MAX) has a certain level of risk with the current maintenance and airmanship standards, with the addition of the max to the aviation transport system this level of risk has increased. If the increase in risk associated with the addition of the MAX to the aviation transport system can be mitigated by increasing the piloting and maintenance standards (at a cost) then why should the aviation transport system as a whole pay for that when those same available resources could have a higher impact on safety when placed elsewhere?

Unless of course you think that with a limited amount of resource available you don't want the safest system possible just to keep the MAX flying...which really would be an extreme view to take.

Fred


Of course I want the Max to be as safe as possible. But I also don't think poor pilot trainy and maintenance practices should be ignored. Someone who can't keep a C172 straight and level has no business in a passenger jet. Developing countries are experiencing huge booms in air travel demand and putting warm bodies with minimal training in a 737 or A320 is not a good idea. It takes years to develop a good pilot. Working your way up through single engine airplanes and ratings is the way to do it. Throwing a newbie into a simulator and then immediately to on the job training is a recipe for disaster.


But Boeing strongly fought against even throwing the pilots into simulators for Max?
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 7:17 am

kayik wrote:
At Around 1:15 PM Boeing shares hit the bottom at $302. Five minutes after that 3 pieces of news were released and stock price rose to $312.


Boeing wants to resume production of 737 Max months before the planes return to service

Boeing CEO says return of 737 Max was delayed further because it recommended pilot simulator training

Boeing CEO: Will not suspend or cut dividend


Yep Boeing are working hard to protect the share price still

They will need 3 more good news stories again today though because soon after that gain above it dropped back down again!!

Down to 307 now
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 10:13 am

Revelation wrote:
The quote from the text dump was the 737 "airplane is designed by clowns, who are in turn supervised by monkeys" and was from a Boeing employee so IMO is not a reference to the FAA.


Agreed.

astuteman wrote:
That kite was going to get flown whichever way the wind was blowing.
"Anyone but Boeing" …...


It seems to be the mantra of some posters.

astuteman wrote:
You and I both have a good idea that the FAA got their heads around "There's no way we're going to get caught out like that again" a lot quicker than Boeing seem to have.
Having lost the trust of the FAA, Boeing are going to have to rebuild it.
And in my experience that means bending over and taking it where the sun don't shine, with a smile on your face, until the trust is restored - a process that takes years.

Unfortunately for some A-netters, the FAA have to rebuild trust too, and got on the agenda a lot quicker than Boeing have.
Boeing are not victims here of anything other than their own actions.


Absolutely. The FAA's part in certifying the MAX cannot be understated or ignored, but as you've pointed out, they seem to have had their 'reboot' and have moved on much quicker than Boeing have. Maybe Calhoun's acceptance of the need for simulator training and the new timeline of "mid-summer" for the begining of RTS is a sign that Boeing realises they're in a hole and have finally decided to stop digging.
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 10:28 am

beechnut wrote:
I guess Boeing managers never read the Johnson & Johnson case study on how to manage a crisis.

Beech


The Boeing managers were too busy reading Jack Welch's books on how to make 'shareholder value' as corporate priorities 1, 2, and 3.
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 10:38 am

Revelation wrote:
Well if the fix was ready in April clearly someone within Boeing knew it was a serious problem. Clearly the JT data showed multiple MCAS activations and anyone understanding the ramifications would soon realize a single bad AoA sensor triggered a set of actions that the crew wasn't able to deal with.


What do we know about the solution in the works at the time of the ET crash?

Would it even have been a valid fix? I think not.
By all appearance it would have been a tamed down MCAS that would not look into the single sensor issue.

When was it known that "AoA mismatch" was not indicated even if ordered as option?

The complete affair is so full of "strange" decisions on the surface driven by "strongly" not looking into "anything" that
one must assume that a completely different set of objectives was at the core of all activities.

Quite the achievement to have so much effected appearing as unintentional, by accident, oversight, dog ate schoolwork ...
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 10:57 am

cuban8 wrote:
The latest developments makes me think that the MAX will RTS in a year or so. Now that it seems like Boeing pretty much missed the important summer season RTS, I think it will relieve some pressure from the workers for a rushed RTS. With that “extra” time, the engineers should bring a more mature and non-rushed solution for the MAX.


Any chance that Boeing could retrofit the FCC from the KC-46 to the Max? I'm not certain, but I thought I read that the KC-46 has redundant AOA sensor MCAS.

EDIT: Yes, it is a two sensor MCAS, per:
https://www.airforcemag.com/usaf-review ... as-system/
Last edited by sgrow787 on Thu Jan 23, 2020 11:10 am, edited 1 time in total.
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Oh just one se-en-sor,
Just one sensor,
Ooh ooh oo-ooh
Oo-oo-ooh.
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 11:00 am

Revelation wrote:
snasteve wrote:
As for Bombardier, I’m sure that they are ultimately happier to be partnered with Airbus than Boeing.

Not really, BBD just said in their year end financial announcements that they are reconsidering their partnership in ACLP so there is no happiness for BBD to be had these days. Keep in mind that BBD offered the CS program to Boeing and Airbus twice each, and the only time they got acceptance was when they offered to give 50% share and board control to Airbus for $1. It always was going to end in tears for BBD and its investors. Maybe they can be proud of producing the C Series, but other than that, it looks like they will get no benefit from it after pouring many years and many billion dollars into the program.

The A220-300 is a successful product in his segment, but compared to the A32[0/1]neo and 737-[8/9/10] MAX segment, the operators simply don't buy so much aircrafts in the segment of the C-300 (now A220-300), E195-E2, A319neo, and 737-7 MAX. The ratio is about 1/15:

505 A220-300
123 E195-E2
82 737-7 MAX
37 A319neo
747 Total

3896 A320neo
3255 A321neo
3221 737-8 MAX
474 737-9 MAX
521 737-10 MAX
11367 Total

I don't think that this fact is so much related to the Airbus vs Boeing acquisition of Bombardier. The big market with high margin is actually simply not in that segment. This will probably not change so much until the operators find that segment more appealing and buy massively more products from that segment.
:stirthepot: 737-8 MAX: "For all speeds higher than 220 Kts and trim set at a value of 2.5 units, the difficulity level of turning the manual trim wheel was level A (trim wheel not movable)." :stirthepot:
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 12:28 pm

Revelation wrote:
As I wrote earlier, I'm more inclined to believe he simply did not dig very deeply and preferred to defer to underlings. This is my impression after watching his Congressional testimony.

That testimony is nothing but a carefully planified show. Given enough $$$ everyone will make fools of themselves if necessary.


Revelation wrote:
Ironically he is a trained engineer so he should have had the skills and the instincts he needed, but it seems he was happy to sit in Chicago and delegate to others.

Being a veteran with Boeing, I think the contrary. He knew better than anyone else how's the work being done.

By accepting the culture and compromises and the cheatings, he took risks indeed. Things were not supposed to backfire like this, after all aviation world is full of non-lethal incidents that are progressively adressed in the long term, then look at that TK crash with fatalities, it was simple to transfert the blame on the pilots. What could go wrong ?
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 1:37 pm

Southwest says the grounding has cost it over 800 million dollars and for AA it seems to be around 540 million dollars. https://edition.cnn.com/2020/01/23/business/southwest-american-airlines-earnings/index.html

This is for around 8 months of grounding. If we add another 8 months until next August we have around 2.5 billion dollars from these two carriers alone and does not take into account the additional aircraft that should have been delivered in 2020.
 
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 2:30 pm

How will Boeing restart the production line even before RTS? Won't that add more pressure on getting the 400 already produced planes out the door? It seems like they just want to make announcements, even if their plans are still up in the air.
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 2:53 pm

Cruiser wrote:
How will Boeing restart the production line even before RTS? Won't that add more pressure on getting the 400 already produced planes out the door? It seems like they just want to make announcements, even if their plans are still up in the air.


Especially if those announcements 'tickle' the share price. :duck:
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 2:58 pm

TaromA380 wrote:
Revelation wrote:
hivue wrote:
So if Muilenberg had been fired last Summer or early Fall the MAX would be back flying by now? I don't think so.

If Muilenberg had never even been CEO, JT and ET would not have happened? I don't think so.

The BoD let him go for specific cause, not to make him a scapegoat for this whole sorry mess. We shouldn't be looking for scapegoats either.

My comments point out that DM was in charge of the strategy chosen to deal with both crashes.

I think it's fair speculation to suggest that if DM had taken a different approach after the first crash we could very well have had RTS pretty much when the MCAS 2.0 fix was ready which some suggest was just a few weeks after the 2nd crash in April 2019.

Why? Well if the fix was ready in April clearly someone within Boeing knew it was a serious problem. Clearly the JT data showed multiple MCAS activations and anyone understanding the ramifications would soon realize a single bad AoA sensor triggered a set of actions that the crew wasn't able to deal with. Sure, maybe another crew could have done better, but surely MCAS also should have been implemented better too.

It seems to me the decision to use bravado and evasion was made at the executive level right after the first crash, which little internal investigation as to how likely or unlikely it was that there was a serious problem.

His Congressional testimony showed little evidence that he understood the ramifications of the idea that his company had serious shortcomings with regard to how MCAS was categorized, designed, developed, implemented and tested.

It seemed he was happy to delegate, believe the best, and stay clear of the blowback.

With great rewards come great responsibilities.


That DM's strategy looks like an epic fail, we know by hindsight.

One year ago, he took a bet, kind of “betting the company”, that the “too big to fail” mantra, along with big friends, will save the Max from grounding or, if things go really wrong, will quickly allow its RTS no matter what.

I suppose he took such a bet based on internal knowledge and anticipation that once grounded for a long period fo time, the Max program will be badly badly toasted. Losing his bet would cost what, six additional months of agony? Not a huge difference in the big scheme of things. On the other side, winning his bet would have been the most genial and rewarding bluff in history (yet to remain secret).

There is no moral in economics. DM really assumed responsibility in corporate terms (which aren’t our armchair generals’ terms) and went to fight back trying to stop the monster at the company’s gate by continuing bluffing, trying one last trick to save the day. It didn’t work, but at least “he died trying” like his function required it. He was getting paid to do this and he deserved every million he got.

I consider what we saw after the two crashes as mostly bluffs, the real decision and action vectors being behind the curtain but easy to understand if we analyze the situation without emotions. Media is telling us emotional stories, not what's really happening.

It must be sorrowful to dearly hope that you are too big to fail, only to discover …



Otherwise, with time passing by, soon should arrive the final report of ET crash.


DM looked totally out of his depth from day one after the second crash. Zero charisma and zero leadership. I wouldn't really credit him with choosing any strategy to be honest. He just floundered. All looked pretty chaotic and desperate to me. He was abysmal every time he faced any media or any public questioning. It just shows the lack of good leaders around in business nowadays if someone like him can rise to a position and be earning what he earnt at Boeing without really having any noticeable leadership ability at all.

Can anyone suggest any leadership qualities he showed during the crisis at all? He was like a rabbit in the headlights from what I saw of him.
Last edited by Interested on Thu Jan 23, 2020 3:01 pm, edited 1 time in total.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 3:00 pm

FluidFlow wrote:
Southwest says the grounding has cost it over 800 million dollars and for AA it seems to be around 540 million dollars. https://edition.cnn.com/2020/01/23/business/southwest-american-airlines-earnings/index.html

This is for around 8 months of grounding. If we add another 8 months until next August we have around 2.5 billion dollars from these two carriers alone and does not take into account the additional aircraft that should have been delivered in 2020.


SW is using some very creative accounting to get to that $828 Million loss.

Sorry but having more aircraft in the fleet would not be helping the Load Factor.

That is the big reason for the earnings miss.

They are saying the MAX grounding impacted Operating Earnings by $828 Million. On average they should have had about 50 MAX's flying for 9 months. There extra efficiency would not have generated an extra $1.4 Million of Operating income per month (about 4-5X the lease rate of a MAX) per frame.

If they have extra frames it arguably would just have added more capacity into the system and lowered yields further.

The most interesting quote from the press release is this:

"During fourth quarter, reached confidential agreement with The Boeing Company (Boeing) on compensation related to estimated 2019 financial damages due to the March 13, 2019, Federal Aviation Administration (FAA) order to ground the Boeing 737 MAX aircraft (MAX); substantially all of the compensation will be accounted for as a reduction in the cost basis of both owned MAX aircraft and future purchased MAX aircraft, which is expected to reduce depreciation expense in future years"

Which sounds like to me they just gave them a partial refund on the 34 already delivered and SW will just pay less for each frame going forward. That is a very small current cash cost for Boeing and what many of us on here were guessing would happen.
 
FluidFlow
Posts: 726
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 3:09 pm

morrisond wrote:
FluidFlow wrote:
Southwest says the grounding has cost it over 800 million dollars and for AA it seems to be around 540 million dollars. https://edition.cnn.com/2020/01/23/business/southwest-american-airlines-earnings/index.html

This is for around 8 months of grounding. If we add another 8 months until next August we have around 2.5 billion dollars from these two carriers alone and does not take into account the additional aircraft that should have been delivered in 2020.


SW is using some very creative accounting to get to that $828 Million loss.

Sorry but having more aircraft in the fleet would not be helping the Load Factor.

That is the big reason for the earnings miss.

They are saying the MAX grounding impacted Operating Earnings by $828 Million. On average they should have had about 50 MAX's flying for 9 months. There extra efficiency would not have generated an extra $1.4 Million of Operating income per month (about 4-5X the lease rate of a MAX) per frame.

If they have extra frames it arguably would just have added more capacity into the system and lowered yields further.

The most interesting quote from the press release is this:

"During fourth quarter, reached confidential agreement with The Boeing Company (Boeing) on compensation related to estimated 2019 financial damages due to the March 13, 2019, Federal Aviation Administration (FAA) order to ground the Boeing 737 MAX aircraft (MAX); substantially all of the compensation will be accounted for as a reduction in the cost basis of both owned MAX aircraft and future purchased MAX aircraft, which is expected to reduce depreciation expense in future years"

Which sounds like to me they just gave them a partial refund on the 34 already delivered and SW will just pay less for each frame going forward. That is a very small current cash cost for Boeing and what many of us on here were guessing would happen.


It is not really the actual cash loss that hurts Boeing but the MAX will become a really low profit program due to the issues:

Let's make a simple calculation. Boeing sells 5000 Max. After discount the MAX costs around 50m$. If we assume an average profit margin of 15% the profit on the complete MAX-Program is around 37.5 billion dollars. Costs of the MAX grounding is right now estimated in the order of 20 billion dollars.

The crisis right now cuts the profit on the MAX-Program more than in half. Boeing will still make profits and undoubtedly will weather the MAX fiasco but it is a hefty cut in profits over the next years.
 
upright
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Joined: Mon Jan 13, 2020 9:01 am

Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 3:19 pm

In a recent interview, the current entire Boeing board of directors is blamed for lack of expertise:
https://www.youtube.com/watch?v=YuDziDgtMU0
What could the new CEO David Calhoun have in mind to "pocket" as much money as possible ?
At least he claims to believe in the B737max future, which is in doubt already including me as well.
Now he has lots of time until summer without someone "asking too many questions due to lack of B737max delivery".
David Calhoun is supposed to be a kind of financial juggler.
 
User avatar
Revelation
Posts: 24655
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Re: Boeing 737MAX Grounding, General Discussion Thread, January 2020

Thu Jan 23, 2020 3:25 pm

WIederling wrote:
What do we know about the solution in the works at the time of the ET crash?

Would it even have been a valid fix? I think not.
By all appearance it would have been a tamed down MCAS that would not look into the single sensor issue.

When was it known that "AoA mismatch" was not indicated even if ordered as option?

The complete affair is so full of "strange" decisions on the surface driven by "strongly" not looking into "anything" that
one must assume that a completely different set of objectives was at the core of all activities.

Quite the achievement to have so much effected appearing as unintentional, by accident, oversight, dog ate schoolwork ...

It's a good point, but in the post-JT time frame jedi mind tricks still worked and a proactive grounding by Boeing would be seen as a strong pro-safety move. After ET, FAA would have none of it.

TaromA380 wrote:
Revelation wrote:
Ironically he is a trained engineer so he should have had the skills and the instincts he needed, but it seems he was happy to sit in Chicago and delegate to others.

Being a veteran with Boeing, I think the contrary. He knew better than anyone else how's the work being done.

By accepting the culture and compromises and the cheatings, he took risks indeed. Things were not supposed to backfire like this, after all aviation world is full of non-lethal incidents that are progressively adressed in the long term, then look at that TK crash with fatalities, it was simple to transfert the blame on the pilots. What could go wrong ?

If that's the case he knew how the work was done, he must have had balls of steel to double down after the JT crash. The sensible move then would have been to ground "out of an abundance of caution" and get the fix through the system before all the rest was discovered. It didn't take a rocket scientist to know if one AoA could crash a plane it was only a matter of time till a second AoA had a fault.
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