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beechnut
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Joined: Wed Apr 21, 2004 12:27 am

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

Fri Apr 03, 2020 9:58 pm

ShamrockBoi330 wrote:

Air Canada - Cancelled all MAX 9s on order, one would assume AC is also due compensation on grounded and remaining undelivered MAX 8s.

I get what you're saying, and the devil is always in the detail, detail we will never know, but do you not think there will be more similar to this given current climate and issues with the MAX?


Air Canada has already concluded a compensation deal with Boeing for the MAX 8. From the MAX News reference thread, I posted:

In spite of the title of the article, buried within the financial measures to deal with COVID-19, was an item that said Air Canada has concluded negotiations with Boeing on compensation for the MAX grounding:

https://canadianaviationnews.wordpress. ... -covid-19/

In its news release dated February 18, 2020, Air Canada disclosed that it was in discussions with Boeing to settle the terms of an arrangement in relation to the grounding of the Boeing 737 MAX aircraft. These discussions have now concluded, however, as the terms of the arrangement are subject to confidentiality restrictions, Air Canada will not be disclosing its terms.
 
smartplane
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Fri Apr 03, 2020 10:58 pm

ShamrockBoi330 wrote:
smartplane wrote:
JoergAtADN wrote:

But nowadays many airlines need cash to survive - and if they cancel a 737MAX order, where the delivery is delayed more than 12months, they can request the deposits back, which they payed to Boeing.

Same applies for the first delivery slots of the 777X, while they would loose their deposits if they cancel orders of other types like 787, 747 or any Airbus or Embraer type.

The vast majority, if not all remaining MAX customers, have executed at least one new contract incorporating compensation. Cancelling and getting back cash any time soon, won't be an option (many airlines use pre-delivery finance, so the financiers are the ones in line to receive deposit refunds).

Compensation in the aviation industry is either in the form of up front discounts, retrospective credits, or both. Both OEM's learned from the A380 and 787 delays, to focus on retrospective credits, which defer negative cash flows for years, and 'cloak' the ultimate values.

The 'carrot' for customers to stay aboard the MAX bandwagon, is the value of the retrospective credits, well North of 50% if a customer takes all of their original order. One NEO could be worth 3x MAX, a very attractive proposition for MAX customers.

But this overhang will hit used residuals of all 737's and A320's, including all existing lease contracts (lower EOL values), and feed through to new 737 and A320NEO sales, and even impact smaller WB's like the 788 and A330NEO (though they may gain from less demand for larger WB's).

Ultimately, it all comes down to dotting and crossing (i's and t's). How good has the inhouse and external legal teams been, minimising escape routes where customers can flee, and damage limitation, in respect to how much can they extract.

Has MAX focus been at the expense of the 777X? At most, there can only be three customers, each with one tranche, that could even remotely have gone unconditional. But those are likely to be up for re-negotiation due to late delivery, or slipped back to conditional. Lean, bleak times for all in the aviation industry (except lawyers, forensic accounts and a few other specialists).


Air Canada - Cancelled all MAX 9s on order, one would assume AC is also due compensation on grounded and remaining undelivered MAX 8s.

I get what you're saying, and the devil is always in the detail, detail we will never know, but do you not think there will be more similar to this given current climate and issues with the MAX?

When a customer opts for cash in lieu of credit, they are taking a 50% plus discount or more, compared to using the credit.

Customers insisting on cash either have very pressing needs, and / or don't see a way to utilise credits in the foreseeable future, or are concerned about the prospects of Boeing viability.
 
ShamrockBoi330
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 5:12 am

smartplane wrote:
ShamrockBoi330 wrote:
smartplane wrote:
The vast majority, if not all remaining MAX customers, have executed at least one new contract incorporating compensation. Cancelling and getting back cash any time soon, won't be an option (many airlines use pre-delivery finance, so the financiers are the ones in line to receive deposit refunds).

Compensation in the aviation industry is either in the form of up front discounts, retrospective credits, or both. Both OEM's learned from the A380 and 787 delays, to focus on retrospective credits, which defer negative cash flows for years, and 'cloak' the ultimate values.

The 'carrot' for customers to stay aboard the MAX bandwagon, is the value of the retrospective credits, well North of 50% if a customer takes all of their original order. One NEO could be worth 3x MAX, a very attractive proposition for MAX customers.

But this overhang will hit used residuals of all 737's and A320's, including all existing lease contracts (lower EOL values), and feed through to new 737 and A320NEO sales, and even impact smaller WB's like the 788 and A330NEO (though they may gain from less demand for larger WB's).

Ultimately, it all comes down to dotting and crossing (i's and t's). How good has the inhouse and external legal teams been, minimising escape routes where customers can flee, and damage limitation, in respect to how much can they extract.

Has MAX focus been at the expense of the 777X? At most, there can only be three customers, each with one tranche, that could even remotely have gone unconditional. But those are likely to be up for re-negotiation due to late delivery, or slipped back to conditional. Lean, bleak times for all in the aviation industry (except lawyers, forensic accounts and a few other specialists).


Air Canada - Cancelled all MAX 9s on order, one would assume AC is also due compensation on grounded and remaining undelivered MAX 8s.

I get what you're saying, and the devil is always in the detail, detail we will never know, but do you not think there will be more similar to this given current climate and issues with the MAX?

When a customer opts for cash in lieu of credit, they are taking a 50% plus discount or more, compared to using the credit.

Customers insisting on cash either have very pressing needs, and / or don't see a way to utilise credits in the foreseeable future, or are concerned about the prospects of Boeing viability.


So realistically, any airline who has come out and said compensation talks have been concluded could cancel similar to AC, one has to assume.

This is not going to be pretty over the coming months.
 
cedarjet
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 6:58 am

The Max will never fly again. First of all, a group of American pilots who were given runaway MCAS training all flunked a trial sim ride, that’s as recent as December (source: Bloomberg). So the underlying problem isn’t close to fixed. Regulators can’t even meet for months because of coronavirus. By the time it’s done, those planes will have sat in Boeing’s parking lot for two years — they’ll be wrecks. The one thing the Max has going for it is efficiency, but that doesn’t mean much when oil is at $20/bbl, if it comes with high ownership cost. Thousands of paid-off mid-life 737-800s out there. And in the middle of the biggest economic meltdown since 1929, half the airlines who ordered it won’t exist, and for the other half, extra capacity will be the last thing they need. It’s done.
fly Saha Air 707s daily from Tehran's downtown Mehrabad to Mashhad, Kish Island and Ahwaz
 
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AirlineCritic
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 9:01 am

Airbus is rumoured to be cutting production of the 320 series aircraft by 50%.

My guess is that they've run the numbers and see a world-wide demand cut of 75% for new narrowbody aircraft, beyond the current acute situation. Airbus will deliver all those narrowbody aircraft that the market will need in the next five years, while Boeing will - painfully - exit the market.

Why? If that were *not* the case, why would Airbus cut production 50%? I'm 99.9% certain that airlines that would be able to get into the line for new A320s would rather get those than the uncertain and also ill-optimised 737s. So, 50% product is what Airbus believes they will sell. And that is the actual worldwide demand, for any A320/737-sized aircraft.

Boeing will probably RTS MAX and deliver some number of aircraft for contractual reasons, but the length of the delays, contractual termination clauses becoming available, suddenly available alternatives, and uncertainty means that their actual contracts will continue to shrink rapidly towards 0.

You heard it here first, folks.
 
Noshow
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 9:06 am

If Airbus has to halve the A320neo production due to the market collapsing Boeing can stop their entire MAX-line. I hope both steps will not be necessary.
 
Scotron12
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 9:51 am

Article in Forbes say that quite a few airlines overordered aircraft they don't actually need from both OEMS.


https://www.forbes.com/sites/jeremyboga ... on-cancel/
 
MartijnNL
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 10:33 am

kalvado wrote:
Boeing needs to maximize profit - or, in case of MAX - minimize losses. That is pretty obvious.

Absolutely not. Boeing trying to maximize profit directly lead to the MAX fiasco. Thát is pretty obvious.

No company should try to maximize profit by cutting corners. Boeing should reinvent itself, design a totally new aircraft and regain the trust of its customers and the flying public.
 
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Polot
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 12:00 pm

ShamrockBoi330 wrote:
smartplane wrote:
ShamrockBoi330 wrote:

Air Canada - Cancelled all MAX 9s on order, one would assume AC is also due compensation on grounded and remaining undelivered MAX 8s.

I get what you're saying, and the devil is always in the detail, detail we will never know, but do you not think there will be more similar to this given current climate and issues with the MAX?

When a customer opts for cash in lieu of credit, they are taking a 50% plus discount or more, compared to using the credit.

Customers insisting on cash either have very pressing needs, and / or don't see a way to utilise credits in the foreseeable future, or are concerned about the prospects of Boeing viability.


So realistically, any airline who has come out and said compensation talks have been concluded could cancel similar to AC, one has to assume.

This is not going to be pretty over the coming months.

I would assume the AC cancelations (which remember, were pre covid, at least before it became major thing) and AC conclusions of compensation talks are linked, i.e. Boeing allowed favorable cancellation of those specific frames as part of compensation package. The rest of the AC 737max orders (or orders from others who have concluded talks) may not be so easy to cancel now.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 1:37 pm

I think Boeing's recent actions strongly suggest what its actions will be.

Not all MAX orders will be cancelled. 50%-60%? Most likely. But so far they seem to be going down the route of no Bailout - downsize the company to reality and the MAX will RTS sometime in the next 4-6 months.

That still means 2000-2500 to produce over the next decade and possibly more as demand recovers and potentially more sales if they do ER variants of the -8 and -10.

Production wil restart at maybe 10-20 frames a month for a few years.

Unless they are forced by regulators they will not shut down MAX production permanently. Which I really doubt as the US will want to preserve Jobs and will find a way to get it back in the air.
 
beechnut
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 2:19 pm

Polot wrote:
I would assume the AC cancelations (which remember, were pre covid, at least before it became major thing) and AC conclusions of compensation talks are linked, i.e. Boeing allowed favorable cancellation of those specific frames as part of compensation package. The rest of the AC 737max orders (or orders from others who have concluded talks) may not be so easy to cancel now.


The MAX 9 cancellations were not pre-covid. Prior to covid-19, they were deferrals, not cancellations although many (including myself) speculated that they would never be taken up and AC would order A321NEOs/LRs instead. The official cancellation came on March 11.

Beyond that we have no ideal what the AC terms are. Retroactive discounts on delivered MAX? Discounts on more 787s? (I doubt it; they don't need the capacity)? Cash? Cancellation of undelivered MAX? Cancellation of unbuilt MAX? Ability to cancel and return already delivered MAX if no RTS by a certain date?

The terms of the deal are confidential. So we won't know unless we see actual cancellations. If there are no cancellations, it is safe to assume the deal is discounts and/or cash compensation.

Beech
 
Scotron12
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 2:24 pm

morrisond wrote:
I think Boeing's recent actions strongly suggest what its actions will be.

Not all MAX orders will be cancelled. 50%-60%? Most likely. But so far they seem to be going down the route of no Bailout - downsize the company to reality and the MAX will RTS sometime in the next 4-6 months.

That still means 2000-2500 to produce over the next decade and possibly more as demand recovers and potentially more sales if they do ER variants of the -8 and -10.

Production wil restart at maybe 10-20 frames a month for a few years.

Unless they are forced by regulators they will not shut down MAX production permanently. Which I really doubt as the US will want to preserve Jobs and will find a way to get it back in the air.


Let me ask you: Why did it take 2 fatal crashes of the 737MAX to get to where we are today? Forget about the pilots and the airlines involved....why was this deathtrap allowed in the air in the 1st place?

To preserve jobs you mean the government will pressure the FAA to recertify so Boeing doesn't go bankrupt??
 
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Polot
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 2:25 pm

beechnut wrote:
Polot wrote:
I would assume the AC cancelations (which remember, were pre covid, at least before it became major thing) and AC conclusions of compensation talks are linked, i.e. Boeing allowed favorable cancellation of those specific frames as part of compensation package. The rest of the AC 737max orders (or orders from others who have concluded talks) may not be so easy to cancel now.


The MAX 9 cancellations were not pre-covid. Prior to covid-19, they were deferrals, not cancellations although many (including myself) speculated that they would never be taken up and AC would order A321NEOs/LRs instead. The official cancellation came on March 11.

No, March 11 is when the cancellation was publicly revealed. The cancellation occurred in February which is why it was announced on March 11 when Boeing released their February orders and cancellations, which included Air Canada.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 2:47 pm

Scotron12 wrote:
morrisond wrote:
I think Boeing's recent actions strongly suggest what its actions will be.

Not all MAX orders will be cancelled. 50%-60%? Most likely. But so far they seem to be going down the route of no Bailout - downsize the company to reality and the MAX will RTS sometime in the next 4-6 months.

That still means 2000-2500 to produce over the next decade and possibly more as demand recovers and potentially more sales if they do ER variants of the -8 and -10.

Production wil restart at maybe 10-20 frames a month for a few years.

Unless they are forced by regulators they will not shut down MAX production permanently. Which I really doubt as the US will want to preserve Jobs and will find a way to get it back in the air.


Let me ask you: Why did it take 2 fatal crashes of the 737MAX to get to where we are today? Forget about the pilots and the airlines involved....why was this deathtrap allowed in the air in the 1st place?

To preserve jobs you mean the government will pressure the FAA to recertify so Boeing doesn't go bankrupt??


How does your first comment have anything to do with what I wrote? However - Yes the FAA should never have certified it as being airworthy. There was a big easily fixable manageable flaw that no one caught.

No - so the Government doesn't have to bail out Boeing. It's a lot cheaper for them. That being said unless something new is found according to the most recent articles it seems like it is getting pretty close to RTS and "should" be safe from here on out assuming it's flown by at least half competent airlines/pilots now that it's limitations are more clearly understood and can be trained for.
 
kalvado
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Sat Apr 04, 2020 3:17 pm

MartijnNL wrote:
kalvado wrote:
Boeing needs to maximize profit - or, in case of MAX - minimize losses. That is pretty obvious.

Absolutely not. Boeing trying to maximize profit directly lead to the MAX fiasco. Thát is pretty obvious.

No company should try to maximize profit by cutting corners. Boeing should reinvent itself, design a totally new aircraft and regain the trust of its customers and the flying public.

Yet there is a need to maximize profit. Anything done to increase profits has inherited risks, though, and this time things didn't work - but that doesn't change underlying principle.
I
 
FluidFlow
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 5:51 am

I wonder how good future credits work right now for Boeing in the compensation departement. I think airlines would like hard cash right now or will cancel outright (do they then get money back?). Everything that minimizes cash outflow will be better than saving on future purchases, as a bankrupt airline can not make future purchases anyway.

Also why getting new MAX aircraft, when a probably lot of second hand Neos will be available soon. How many are already delivered? 1000?

Some mexican Neos are already back at the lessors and I have a feeling there might be more coming from other airlines that over extended. It is definetely cheaper to lease in those Neos than buy MAX aircraft.

The dynamic of the market has changed enourmous and everyone needs cash and will save cash where possible and if cancelling MAX aircraft and leasing in either newish NGs from shrinking airlines or new Neos is cheaper than taking up a MAX I think it will be cancelled. Hard times ahaed for all the manufacturers but certainly for Boeing and the MAX.
 
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enzo011
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 8:03 am

morrisond wrote:
How does your first comment have anything to do with what I wrote? However - Yes the FAA should never have certified it as being airworthy. There was a big easily fixable manageable flaw that no one caught.

No - so the Government doesn't have to bail out Boeing. It's a lot cheaper for them. That being said unless something new is found according to the most recent articles it seems like it is getting pretty close to RTS and "should" be safe from here on out assuming it's flown by at least half competent airlines/pilots now that it's limitations are more clearly understood and can be trained for.



You just cannot help yourself, "assuming it's flown by at least half competent airlines/pilots", do you mean all those airlines flying 737NG fleets and not crashing them like Ethiopian Airlines and Lion Air?

As for your comment on RTS, that is not what you posted initially.

morrisond wrote:
Which I really doubt as the US will want to preserve Jobs and will find a way to get it back in the air.


So will the US want to preserve jobs and find a way to get the RTS done? Or will it be done according to the timeline that is currently in progress because for me those 2 are not the same.
 
beechnut
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 1:45 pm

morrisond wrote:
There was a big easily fixable manageable flaw that no one caught.


Funnily enough, over 1 year out, that "easily fixable mangeable flaw" is neither fixed, nor managed, at least in any certifiable form.

Perhaps not so easily manageable or fixable as those "reasonably competent pilots" that failed to follow the published procedures, when testing them in the sim, demonstrated.

I'm now in the category of "I'll believe it when I see it" (or read that the FAA, TC, EASA etc. have approved the modifications).

Beech
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 2:10 pm

cedarjet wrote:
The Max will never fly again. First of all, a group of American pilots who were given runaway MCAS training all flunked a trial sim ride, that’s as recent as December (source: Bloomberg). So the underlying problem isn’t close to fixed.

I thought they all recovered the a/c - no lawn darts - but they did not follow the prescribed procedures, that should count as some improvement, right?
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 2:11 pm

Noshow wrote:
If Airbus has to halve the A320neo production due to the market collapsing Boeing can stop their entire MAX-line. I hope both steps will not be necessary.

Boeing stopped the MAX line back in January.
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 2:18 pm

enzo011 wrote:
So will the US want to preserve jobs and find a way to get the RTS done? Or will it be done according to the timeline that is currently in progress because for me those 2 are not the same.

Which timeline is this, the FAA / EASA timeline prior to the worldwide shutdown or the timeline after the shutdown which I admit I have not seen?
The EASA spokes person who spoke about them having a test flight early in the year should have walked that back by now, Boeing January advise of mid summer was ridiculed by the head of the FAA as too conservative. Now with the virus, everyone seems to have gone mute, even from the point of officially saying they now have no timeline for certification activities.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 2:34 pm

beechnut wrote:
morrisond wrote:
There was a big easily fixable manageable flaw that no one caught.


Funnily enough, over 1 year out, that "easily fixable mangeable flaw" is neither fixed, nor managed, at least in any certifiable form.

Perhaps not so easily manageable or fixable as those "reasonably competent pilots" that failed to follow the published procedures, when testing them in the sim, demonstrated.

I'm now in the category of "I'll believe it when I see it" (or read that the FAA, TC, EASA etc. have approved the modifications).

Beech


MCAS was easily fixed. It was the bit flip issue that seems to have caused so many issues.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 2:38 pm

par13del wrote:
cedarjet wrote:
The Max will never fly again. First of all, a group of American pilots who were given runaway MCAS training all flunked a trial sim ride, that’s as recent as December (source: Bloomberg). So the underlying problem isn’t close to fixed.

I thought they all recovered the a/c - no lawn darts - but they did not follow the prescribed procedures, that should count as some improvement, right?


Exactly - no one followed the procedure. That is the big problem as all Aircraft are certified on the basis that crews will follow procedures in an emergency.

Hence why it seems Boeing is going back to the drawing board and designing a new cockpit that won't be dependent on crews following procedures (or as many) to save the plane.
 
oldJoe
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 2:46 pm

according to the article below, recertification activity is now also suspended.
https://leehamnews.com/2020/04/06/ponti ... days-take/
 
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scbriml
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 2:59 pm

par13del wrote:
cedarjet wrote:
The Max will never fly again. First of all, a group of American pilots who were given runaway MCAS training all flunked a trial sim ride, that’s as recent as December (source: Bloomberg). So the underlying problem isn’t close to fixed.

I thought they all recovered the a/c - no lawn darts - but they did not follow the prescribed procedures, that should count as some improvement, right?


Correct, they didn't crash the 'plane'. But, it's still very concerning that despite receiving specific training on MCAS 2.0 and being in a no-risk environment (simulator) and knowing pretty much exactly what they were going to be tested on, they still struggled to follow the correct procedures.
Time flies like an arrow. Fruit flies like a banana!
There are 10 types of people in the World - those that understand binary and those that don't.
 
TaromA380
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 3:23 pm

morrisond wrote:
MCAS was easily fixed. It was the bit flip issue that seems to have caused so many issues.

Always amusing to read your interpretations of facts.

Please remind us, what did that Canadian regulator guy report in last fall leaked email ?
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 4:32 pm

scbriml wrote:
par13del wrote:
cedarjet wrote:
The Max will never fly again. First of all, a group of American pilots who were given runaway MCAS training all flunked a trial sim ride, that’s as recent as December (source: Bloomberg). So the underlying problem isn’t close to fixed.

I thought they all recovered the a/c - no lawn darts - but they did not follow the prescribed procedures, that should count as some improvement, right?


Correct, they didn't crash the 'plane'. But, it's still very concerning that despite receiving specific training on MCAS 2.0 and being in a no-risk environment (simulator) and knowing pretty much exactly what they were going to be tested on, they still struggled to follow the correct procedures.

Compared to the going mindset that Boeing designed MCAS to drive the a/c into the ground...we should say that is a massive improvement.
Now if someone thinks that they are going to design a human / machine interface that has only one resolution pathway........in a non-FBW a/c...
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 5:39 pm

TaromA380 wrote:
morrisond wrote:
MCAS was easily fixed. It was the bit flip issue that seems to have caused so many issues.

Always amusing to read your interpretations of facts.

Please remind us, what did that Canadian regulator guy report in last fall leaked email ?


What I wrote isn't wrong - it was a relatively easy fix until the bit flip issue surfaced - hence why the Canadian regulator suggested - why not just let it fly without MCAS.
 
Ertro
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 6:06 pm

morrisond wrote:
What I wrote isn't wrong - it was a relatively easy fix until the bit flip issue surfaced - hence why the Canadian regulator suggested - why not just let it fly without MCAS.


So somebody thought it was an easy fix until they found out it wasn't.
 
744SPX
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 7:15 pm

Yes, there is an easy fix. Drop the MAX and focus all efforts on NSA with service entry in 7 years. The current global situation is giving Boeing an easy out for the MAX and enough time to design and build NSA. Otherwise BCA goes down with the "too big to fail" sinking ship/disaster that is the MAX.

IMHO the only reason Boeing is still sticking with the MAX is because it is -unbelievably- still too financially short-sighted.
 
TaromA380
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 8:10 pm

morrisond wrote:
TaromA380 wrote:
morrisond wrote:
MCAS was easily fixed. It was the bit flip issue that seems to have caused so many issues.

Always amusing to read your interpretations of facts.

Please remind us, what did that Canadian regulator guy report in last fall leaked email ?


What I wrote isn't wrong - it was a relatively easy fix until the bit flip issue surfaced - hence why the Canadian regulator suggested - why not just let it fly without MCAS.

Oh really ? The MCAS was easy fixed by Boeing but that bit flip issue come out of nowhere and sabotaged poor's Boeing dreams ? Wait, please, I'm squeezing a tear :lol:

Let's remind together then, what was about in the November 2019 leaked email. And remember, that happened several months after Boeing already "easy fixed MCAS" in June 2019, so well fixed that the gathered regulators representatives unceremoniously left the meeting while Boeing was selling them the story of the easy fix.

I guess for you, "easy fixed MCAS" means that notorious Boeing PowerPoint presentation ? By any chance, is that you, the designer behind the “easy fixed MCAS” PowerPoint ? I don't know why you seems so close to the smokes and mirrors dept. at Boeing.

So, here is the leaked email story : https://www.businessinsider.fr/us/boein ... il-2019-11

In the emails, Jim Marko, the manager in aircraft integration and safety assessment at Transport Canada Civil Aviation, wrote that the "only way I see moving forward at this point, is that MCAS has to go," the Times reported.

According to a different email reviewed by The Times, at least one FAA manager, Linh Le, shares his view.

Le, a system safety manager, reportedly forwarded Marko's e-mail to colleagues, and writing that Marko was concerned that "MCAS introduces catastrophic hazards that weren't there before," and that "it and the fix add too much complexity." Le reportedly also said that he had similar concerns.

In the email, Marko reportedly expressed concerns that regulators would feel pressured into accepting the updated software and certifying the Max to fly, even if issues with the fix continued to arise.

As we can see, all they were talking about was the easy fixed MCAS :spin:
Last edited by TaromA380 on Mon Apr 06, 2020 8:25 pm, edited 2 times in total.
 
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Polot
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 8:17 pm

744SPX wrote:
Yes, there is an easy fix. Drop the MAX and focus all efforts on NSA with service entry in 7 years. The current global situation is giving Boeing an easy out for the MAX and enough time to design and build NSA. Otherwise BCA goes down with the "too big to fail" sinking ship/disaster that is the MAX.

IMHO the only reason Boeing is still sticking with the MAX is because it is -unbelievably- still too financially short-sighted.

The prudent thing is to do both- fix the MAX but work on NSA for service entry in 7 years. You are basically suggesting that Boeing commercial work on a new NSA while relying almost entirely on the 787 for revenue for the next 7 years. That is not smart. Just dropping the MAX now is the actual financially short-sighted move- you are prioritizing short term ‘face’/reputation over longer term revenue.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 8:29 pm

TaromA380 wrote:
morrisond wrote:
TaromA380 wrote:
Always amusing to read your interpretations of facts.

Please remind us, what did that Canadian regulator guy report in last fall leaked email ?


What I wrote isn't wrong - it was a relatively easy fix until the bit flip issue surfaced - hence why the Canadian regulator suggested - why not just let it fly without MCAS.

Oh really ? The MCAS was easy fixed by Boeing but that bit flip issue sabotaged poor's Boeing dreams ? Wait, please, I'm squeezing a tear :lol:

Let's remind together then, what was about in the November 2019 leaked email. And remember, that happened several months after Boeing already "easy fixed MCAS" in June 2019, so well fixed that the gathered regulators representatives unceremoniously ended the meeting while Boeing was selling them the story of the easy fix.

I guess for you, "easy fixed MCAS" means that notorious Boeing PowerPoint presentation ? By any chance, is that you, the designer behind the “easy fixed MCAS” PowerPoint ? I don't know why you seems so close to the smokes and mirrors dept. at Boeing.

So, here is the leaked email story : https://www.businessinsider.fr/us/boein ... il-2019-11

In the emails, Jim Marko, the manager in aircraft integration and safety assessment at Transport Canada Civil Aviation, wrote that the "only way I see moving forward at this point, is that MCAS has to go," the Times reported.

According to a different email reviewed by The Times, at least one FAA manager, Linh Le, shares his view.

Le, a system safety manager, reportedly forwarded Marko's e-mail to colleagues, and writing that Marko was concerned that "MCAS introduces catastrophic hazards that weren't there before," and that "it and the fix add too much complexity." Le reportedly also said that he had similar concerns.

In the email, Marko reportedly expressed concerns that regulators would feel pressured into accepting the updated software and certifying the Max to fly, even if issues with the fix continued to arise.

As we can see, all they were talking about was the easy fixed MCAS :spin:


Yes - because the bit flip issue caused them to have to rewrite the software so the computers were in agreement - that made it much harder.

If they had written the software correctly the first time (but not addressing the very remote possibility of the bit flip issue) before it entered service we would most likely not be having this discussion.

Marko was just talking about removing MCAS altogether and rectifying the MAX without it as the odds that an airline pilot stalled it in regular service after ignoring all the other warnings were very remote and better(safer) than having the computer decide what to do.
 
TaromA380
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 8:47 pm

You're basically saying that, Boeing should have cheated the regulators with the bit flip, instead of cheating with the other stuff they cheated. That's interesting to acknowledge, your degree of sharing Boeing's smokes and mirrors methods instead of building an airplane according to certification rules, that led to dead people and the industrial disaster.

Otherwise, the diagram of the leaked email, about the "easy fixed MCAS®" :
Image
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 9:03 pm

TaromA380 wrote:
You're basically saying that, Boeing should have cheated the regulators with the bit flip, instead of cheating with the other stuff they cheated. That's interesting to acknowledge, your degree of sharing Boeing's smokes and mirrors methods instead of building an airplane according to certification rules, that led to dead people and the industrial disaster.

Otherwise, the diagram of the leaked email, about the "easy fixed MCAS®" :
Image


No - it was something incredibly remote. No one would have caught it in the initial certification.

Read this article for more background https://www.seattletimes.com/business/b ... -controls/

The odds of those specific 5 bits flipping are probably orders of magnitude less likely than 3 pitot tubes all freezing at the same time.
 
TaromA380
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 9:08 pm

Exactly what I said. If you're Boeing, then certification rules are for fools. You know better than regulators what's good and what's bad and you follow only what's convenient.
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 9:56 pm

Polot wrote:
The prudent thing is to do both- fix the MAX but work on NSA for service entry in 7 years. You are basically suggesting that Boeing commercial work on a new NSA while relying almost entirely on the 787 for revenue for the next 7 years. That is not smart. Just dropping the MAX now is the actual financially short-sighted move- you are prioritizing short term ‘face’/reputation over longer term revenue.

Why a new NSA, why not the one they were working on a few years ago, it will still be a tube with wings and existing engines. 7 years has to be beaten, as the new a/c is basically a "me to" a/c which removes the limitations of the existing 737.
All the advanced work on production systems would also have to be used as financially they cannot wait 7 years while not selling the MAX.
 
744SPX
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 10:23 pm

par13del wrote:
Polot wrote:
The prudent thing is to do both- fix the MAX but work on NSA for service entry in 7 years. You are basically suggesting that Boeing commercial work on a new NSA while relying almost entirely on the 787 for revenue for the next 7 years. That is not smart. Just dropping the MAX now is the actual financially short-sighted move- you are prioritizing short term ‘face’/reputation over longer term revenue.

Why a new NSA, why not the one they were working on a few years ago, it will still be a tube with wings and existing engines. 7 years has to be beaten, as the new a/c is basically a "me to" a/c which removes the limitations of the existing 737.
All the advanced work on production systems would also have to be used as financially they cannot wait 7 years while not selling the MAX.


If its possible to resurrect that original design and get it to EIS in say, 5 years, that might actually work
 
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par13del
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 10:31 pm

744SPX wrote:
If its possible to resurrect that original design and get it to EIS in say, 5 years, that might actually work

My thought process is that innovation will not start in the narrow body field, the technology has to be proofed before being scaled down, usually a wide body.
The only major change in the narrow body field in recent times has been engines, see the 737 and A320, the A320 started with FBW, what major change has occurred since then to warrant a new build?
Even the supposed new cockpit the FAA is talking about, the A32X, 787 and A350 are not being mandated to have that changed, and they will be the backbone of the aviation for decades to come, so if the NSA is kicked off now, they can probably use some variant of 787 / 777X.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 11:08 pm

TaromA380 wrote:
Exactly what I said. If you're Boeing, then certification rules are for fools. You know better than regulators what's good and what's bad and you follow only what's convenient.



Well Regulators haven't exactly been showing supreme judgement - they are the ones that delegated to Boeing.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 11:15 pm

par13del wrote:
744SPX wrote:
If its possible to resurrect that original design and get it to EIS in say, 5 years, that might actually work

My thought process is that innovation will not start in the narrow body field, the technology has to be proofed before being scaled down, usually a wide body.
The only major change in the narrow body field in recent times has been engines, see the 737 and A320, the A320 started with FBW, what major change has occurred since then to warrant a new build?
Even the supposed new cockpit the FAA is talking about, the A32X, 787 and A350 are not being mandated to have that changed, and they will be the backbone of the aviation for decades to come, so if the NSA is kicked off now, they can probably use some variant of 787 / 777X.


One would hope - but I think the MAX procedure testing in the fall really opened some eyes.

If the MAX gets back in the Air - then I think they should take the required time to try and build the idiot proof airplane as much as possible - with a big red button to completely revert to an alternative Auto Pilot when HAL tries to kill you that uses a completely different set of sensors and puts the airplane in a straight and level attitude and instantly connects to the ground where the pilots can trouble shoot with Manufacturers Experts who are on call 24/7.

Satellite links are good enough and there would be enough sensors on the plane that the ground crew could follow along with what the pIlots are seeing in a Full Motion Sim.

That's a lot easier than training crews on what are sure to be more and more complex aircraft going forward. No need to memorize hundred's of procedures.
 
Ertro
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Mon Apr 06, 2020 11:55 pm

morrisond wrote:
No - it was something incredibly remote. No one would have caught it in the initial certification.
The odds of those specific 5 bits flipping are probably orders of magnitude less likely than 3 pitot tubes all freezing at the same time.


You are still fooled by the Boeing jedi mind tricks. Actually the jedi mind trick phrase refers to something that would be more difficult to spot when this particular one is pretty obvious to spot by anybody who has experience in computer design and testing.

The requirement is that the computer is resistant to bit flips.
If the computer is resistant then it could withstand quite many bit flips and it the computer is not resistant then it could fail even if there is just a single bit flip.

The test that was being run was to find out which category this particular computer belongs to. Does it keep operating even in the presence of bit flips or not.
And that was found out with the testing. Actually it was obvious even before the test that it would fail as it was not designed to conform to this requirement.

The fact that the tested bitflip pattern was incredibly rare does not matter at all. Why? Because every single one from the huge bag of possible bitflip patterns is equally incredibly rare. There does not exist a pattern that would not be incredibly rare. Still the regulation has been written so that resisting these bitflips is necessary. Why? Because there are gazillions of these patterns that each is incredibly rare but because there a gazillions of possible patterns someone of them could trigger at flight and cause a crash. Which one? Nobody knows.

Why is test written so that they test some number of these 5 bitflips patterns? Because that is pretty reasonable test. There are enough of these bitflips to cause problem with high enough probability so that the test is going to yield a result within reasonable time spent at testing. If the computer is designed properly it will pass the test. MAX computer was not designed properly to even have a chance of conforming to the requirements and passing the test. Everybody knew this even before the test. Even if the test would have been written differently it would still have failed.

So the crying of that the tested patterns are incredibly rare is just something that is written to fool some uninformed member of public. The complaint does not make any sense.

morrisond wrote:
No - it was something incredibly remote. No one would have caught it in the initial certification.


To get certification Boeing would have had to swear that MAX was designed to conform to all of the requirements including this bitflip requirement and this is the spot where Boeing would have been caught. The only way this did not happen was because Boeing claimed that this requirement does not apply to grandfathered plane and therefore Boeing was exempt from swearing the plane conforms to the requirements.

morrisond wrote:
The odds of those specific 5 bits flipping are probably orders of magnitude less likely than 3 pitot tubes all freezing at the same time.


This does not matter. If the plane is not designed properly then any pattern of bitflips could cause a crash including millions of possibilities for single bitflips and zillions of different possibilities for 2 bitflips. Nobody is specifically worried about those specific 5 bitflip patterns. Those are just used in testing because selecting them makes sense for the purpose of the running practical tests.
 
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zkojq
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Tue Apr 07, 2020 6:58 am

Noshow wrote:
If Airbus has to halve the A320neo production due to the market collapsing Boeing can stop their entire MAX-line. I hope both steps will not be necessary.


Well they already stopped the Max line. One step ahead of Airbus, as always, right? :box:

Polot wrote:
I would assume the AC cancelations (which remember, were pre covid, at least before it became major thing) and AC conclusions of compensation talks are linked, i.e. Boeing allowed favorable cancellation of those specific frames as part of compensation package. The rest of the AC 737max orders (or orders from others who have concluded talks) may not be so easy to cancel now.


Why on earth would the rest not be so easy to cancel? Boeing had not fulfilled their contractual obligations. With the delays already incurred, why is it not up to Air Canada to decide if they want to cancel some, all or none of their order? Just because they cancel some now doesn't mean they will have waved their contractual right to do so for the remainder of the order at some point in the future.

FluidFlow wrote:
Also why getting new MAX aircraft, when a probably lot of second hand Neos will be available soon. How many are already delivered? 1000?

Some mexican Neos are already back at the lessors and I have a feeling there might be more coming from other airlines that over extended. It is definetely cheaper to lease in those Neos than buy MAX aircraft.


I'm sure that this situation has not gone unnoticed to Air Canada. Integration could be seamless although I wouldn't expect too much to happen before the end of the year end. Cancel the rest of the MAXs, use delay credits for a "free" 787 or two, uptake many of the Interjet NEOs (there's ~15 IIRC).

scbriml wrote:
par13del wrote:
cedarjet wrote:
The Max will never fly again. First of all, a group of American pilots who were given runaway MCAS training all flunked a trial sim ride, that’s as recent as December (source: Bloomberg). So the underlying problem isn’t close to fixed.

I thought they all recovered the a/c - no lawn darts - but they did not follow the prescribed procedures, that should count as some improvement, right?


Correct, they didn't crash the 'plane'. But, it's still very concerning that despite receiving specific training on MCAS 2.0 and being in a no-risk environment (simulator) and knowing pretty much exactly what they were going to be tested on, they still struggled to follow the correct procedures.


Indeed. The mere fact that they knew exactly what was going to happen and the revised procedures to follow doesn't inspire confidence in how the situation would be handled in a regular environment.

oldJoe wrote:
according to the article below, recertification activity is now also suspended.
https://leehamnews.com/2020/04/06/ponti ... days-take/


And the penny drops.

744SPX wrote:
Yes, there is an easy fix. Drop the MAX and focus all efforts on NSA with service entry in 7 years. The current global situation is giving Boeing an easy out for the MAX and enough time to design and build NSA.


When it's apparently a given that narrowbody deliveries will be all but ceased for the next few years, it's hard not to agree with you. Especially since the coming economic collapse will likely have NEO customers cancelling orders and therefore being open to being "switched" to NSA customers in a few years time.
First to fly the 787-9
 
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Polot
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Tue Apr 07, 2020 10:28 am

zkojq wrote:
Polot wrote:
I would assume the AC cancelations (which remember, were pre covid, at least before it became major thing) and AC conclusions of compensation talks are linked, i.e. Boeing allowed favorable cancellation of those specific frames as part of compensation package. The rest of the AC 737max orders (or orders from others who have concluded talks) may not be so easy to cancel now.


Why on earth would the rest not be so easy to cancel? Boeing had not fulfilled their contractual obligations. With the delays already incurred, why is it not up to Air Canada to decide if they want to cancel some, all or none of their order? Just because they cancel some now doesn't mean they will have waved their contractual right to do so for the remainder of the order at some point in the future.

The agreed upon compensation addresses Boeing’s unfilled contractural obligations. Effectively a new contract is drawn up between the airline and Boeing, which does not necessarily mean airlines can easily cancel-they have contractual obligations too. Canceling your order may null and void your compensation. This is primarily Boeing’s fault, but airlines can’t have their cake and eat it too.
 
frmrCapCadet
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Tue Apr 07, 2020 12:36 pm

One bottom line is that the most recent iterations of the 320/373 (plus 220s and the Es) have pretty well maxed out what a two high-ratio bypass engine on a wing and single aisle tube can do. There is no technology out there which can reduce costs of flying by more than a few percent. Flying automation and safety along with pilot training are at center attention for both Airbus (calls for more and better training) and Boeing (who just screwed up). The big two certification agencies are aware that it is time to make flying simpler and better.

As an outside observer I have come to the conclusion that current engines are far too much bleeding edge, expensive, heavy, more difficult to build and design that current material science allows, but amazing for all that. They need to be replaced. My suspicion is hybrid with simpler engines.
Buffet: the airline business...has eaten up capital...like..no other (business)
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Tue Apr 07, 2020 12:42 pm

Ertro wrote:
morrisond wrote:
No - it was something incredibly remote. No one would have caught it in the initial certification.
The odds of those specific 5 bits flipping are probably orders of magnitude less likely than 3 pitot tubes all freezing at the same time.


You are still fooled by the Boeing jedi mind tricks. Actually the jedi mind trick phrase refers to something that would be more difficult to spot when this particular one is pretty obvious to spot by anybody who has experience in computer design and testing.

The requirement is that the computer is resistant to bit flips.
If the computer is resistant then it could withstand quite many bit flips and it the computer is not resistant then it could fail even if there is just a single bit flip.

The test that was being run was to find out which category this particular computer belongs to. Does it keep operating even in the presence of bit flips or not.
And that was found out with the testing. Actually it was obvious even before the test that it would fail as it was not designed to conform to this requirement.

The fact that the tested bitflip pattern was incredibly rare does not matter at all. Why? Because every single one from the huge bag of possible bitflip patterns is equally incredibly rare. There does not exist a pattern that would not be incredibly rare. Still the regulation has been written so that resisting these bitflips is necessary. Why? Because there are gazillions of these patterns that each is incredibly rare but because there a gazillions of possible patterns someone of them could trigger at flight and cause a crash. Which one? Nobody knows.

Why is test written so that they test some number of these 5 bitflips patterns? Because that is pretty reasonable test. There are enough of these bitflips to cause problem with high enough probability so that the test is going to yield a result within reasonable time spent at testing. If the computer is designed properly it will pass the test. MAX computer was not designed properly to even have a chance of conforming to the requirements and passing the test. Everybody knew this even before the test. Even if the test would have been written differently it would still have failed.

So the crying of that the tested patterns are incredibly rare is just something that is written to fool some uninformed member of public. The complaint does not make any sense.

morrisond wrote:
No - it was something incredibly remote. No one would have caught it in the initial certification.


To get certification Boeing would have had to swear that MAX was designed to conform to all of the requirements including this bitflip requirement and this is the spot where Boeing would have been caught. The only way this did not happen was because Boeing claimed that this requirement does not apply to grandfathered plane and therefore Boeing was exempt from swearing the plane conforms to the requirements.

morrisond wrote:
The odds of those specific 5 bits flipping are probably orders of magnitude less likely than 3 pitot tubes all freezing at the same time.


This does not matter. If the plane is not designed properly then any pattern of bitflips could cause a crash including millions of possibilities for single bitflips and zillions of different possibilities for 2 bitflips. Nobody is specifically worried about those specific 5 bitflip patterns. Those are just used in testing because selecting them makes sense for the purpose of the running practical tests.


So how many bit flip issue crashes have there been on the NG which uses the same computers?
Last edited by morrisond on Tue Apr 07, 2020 12:55 pm, edited 1 time in total.
 
morrisond
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Tue Apr 07, 2020 12:53 pm

frmrCapCadet wrote:
One bottom line is that the most recent iterations of the 320/373 (plus 220s and the Es) have pretty well maxed out what a two high-ratio bypass engine on a wing and single aisle tube can do. There is no technology out there which can reduce costs of flying by more than a few percent. Flying automation and safety along with pilot training are at center attention for both Airbus (calls for more and better training) and Boeing (who just screwed up). The big two certification agencies are aware that it is time to make flying simpler and better.

As an outside observer I have come to the conclusion that current engines are far too much bleeding edge, expensive, heavy, more difficult to build and design that current material science allows, but amazing for all that. They need to be replaced. My suspicion is hybrid with simpler engines.



That makes a lot of sense.

The same thing is happening in cars - they are paring highly strung turbo/intercooled engines with a lot of hybrids - instead of just installing a simple Naturally aspirated variant.

You don't need Turbo's for cruising on the Highway or at Altitude.

A hybrid airliner could be designed so the electric motors help get it in the air and to altitude and then effectively cut off. Then a super efficient turbine optimized to function at one specific Altitude and thrust (luckily Airliners don't need to vary thrust or altitude at cruise much).

Do unpowered (effectively) direct to runway descents with the turbine in idle and if necessary the Electrics can kick in faster if thrust is needed for a go around.

How much more efficient could a turbine be that is optimized for a Hybrid solution? How much less would burn in cruise - how much less would it weigh?

Would the less fuel carried weight offset the weight of the electrics and minimal battery storage (for say 10-15 minutes to get up to the flight levels)?
 
beechnut
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Tue Apr 07, 2020 1:37 pm

morrisond wrote:
So how many bit flip issue crashes have there been on the NG which uses the same computers?


NG doesn't have MCAS. I believe the concern with the bit flip issue was that it could inadvertently trigger MCAS or fool the computer into thinking MCAS was active. During testing one pilot "lost" the aircraft (sim) because of this issue.

https://www.engineering.com/DesignerEdg ... ation.aspx

Excerpt:

FAA test pilots ran simulations that deliberately assigned corrupted bits to the MCAS—telling the computer that the MCAS was engaged when it actually wasn’t. One of the three pilots testing the system was unable to restore steady flight and lost the aircraft.

This upgraded the failure mode from a “major fault” that a flight crew could handle, to “catastrophic.” And FAA regulations require that no single fault could lead to a catastrophic result. This meant that Boeing had to fix the cosmic ray problem.


Hence the concern with the MAX and not with the NG.

Beech
 
TaromA380
Posts: 363
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Tue Apr 07, 2020 2:07 pm

So, Boeing could "easy fix" MCAS only partially, out of context. A full fix needs to address all the other aspects related to it.

And that's so shameful that the regulator had to point it out. Where are the Boeing engineers, since the Lion Air crash that uncovered the mess for the first time ?
 
beechnut
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Re: Boeing 737MAX Grounding, General Discussion Thread, April 2020

Tue Apr 07, 2020 2:18 pm

zkojq wrote:
Why on earth would the rest not be so easy to cancel? Boeing had not fulfilled their contractual obligations. With the delays already incurred, why is it not up to Air Canada to decide if they want to cancel some, all or none of their order? Just because they cancel some now doesn't mean they will have waved their contractual right to do so for the remainder of the order at some point in the future.



Air Canada has already negotiated the terms of a settlement with Boeing. The terms are confidential (I posted it in the MAX news thread sticky). So presumably they can't just cancel willy-nilly, unless the terms *are* a cancellation but then that they would have had to disclose.

So if AC were to cancel now, they'd probably be in breach of contract. On the other hand, I would suppose that the terms include a clause like "however if RTS is later than YYYY-MM-DD, these terms no longer apply and AC is free to cancel all remaining orders" and "If Boeing cancels RTS, the following will apply...". What happens to already delivered aircraft would possibly be included especially if there's no RTS at all (something I believe is no longer a remote possibility).

However as it's all confidential, we will only know if there is RTS or failure to RTS. The AC VP finance said that contingency measures would only work until the end of this year. That was before COVID-19 of course. That statement may or may not hold depending on how fast air travel returns to service after the virus has peaked in most places. For us foamers, it's wait and see what happens.

Beech
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