Category Archives: Boeing

EASA declares Boeing 737 MAX safe to return to service in Europe

The European Union Aviation Safety Agency (EASA) gave its seal of approval for the return to service of a modified version of the Boeing 737 MAX, mandating a package of software upgrades, electrical wiring rework, maintenance checks, operations manual updates and crew training which will allow the plane to fly safely in European skies after almost two years on the ground.

“We have reached a significant milestone on a long road,” said EASA Executive Director Patrick Ky. “Following extensive analysis by EASA, we have determined that the 737 MAX can safely return to service. This assessment was carried out in full independence of Boeing or the Federal Aviation Administration and without any economic or political pressure – we asked difficult questions until we got answers and pushed for solutions which satisfied our exacting safety requirements. We carried out our own flight tests and simulator sessions and did not rely on others to do this for us.

“Let me be quite clear that this journey does not end here,” he added. “We have every confidence that the aircraft is safe, which is the precondition for giving our approval. But we will continue to monitor 737 MAX operations closely as the aircraft resumes service. In parallel, and at our insistence, Boeing has also committed to work to enhance the aircraft still further in the medium term, in order to reach an even higher level of safety.”

The Boeing 737 MAX was grounded worldwide in March 2019 following the second of two accidents within just six months, which together claimed 346 lives. The root cause of these tragic accidents was traced to software known as the MCAS (Maneuvering Characteristics Augmentation System), intended to make the plane easier to handle. However, the MCAS, guided by only one Angle of Attack (AoA) sensor, kicked in repeatedly if that sensor malfunctioned, pushing the nose of the aircraft downward multiple times. In both accidents, pilots finally lost control of their plane, resulting in a crash with total loss of aircraft.

EASA’s conditions for Return to Service now met

In the days after the grounding, EASA set four conditions for the return to service of the aircraft:

The two accidents (JT610 and ET302) are deemed sufficiently understood
Design changes proposed by Boeing to address the issues highlighted by the accidents are EASA approved and their embodiment is mandated
An independent extended design review has been completed by EASA
Boeing 737 MAX flight crews have been adequately trained

“These four conditions have now all been met, allowing us to go ahead with the return to service,” Ky said.

To enhance transparency, a closing report released by the Agency explains its approach and the reasoning for its decisions.

While the investigations assessed that the behaviour of the MCAS and related alerting systems were the clear main cause of the two crashes, EASA rapidly realised that a far wider review of the 737 MAX was needed. EASA therefore extended its analysis to the entire flight control system. With a particular focus on the human factors – the actual experience for a pilot of flying the plane.

This extended review, conducted in close cooperation with FAA as primary certification authority, and with Boeing as manufacturer, continued to evolve over the course of the 20-month exercise. Its findings led to the definition of the broad package of actions specified in the Airworthiness Directive.

“The mandated actions need to be seen as a complete package which together ensure the aircraft’s safety,” Ky said. “This is not just about changes to the design of the aircraft: every individual 737 MAX pilot needs to undergo a once-off special training, including simulator training, to ensure that they are fully familiar with the redesigned 737 MAX and trained to handle specific scenarios which may arise in flight. This will be reinforced by recurrent training to ensure the knowledge is kept fresh.”

EASA has also agreed with Boeing that the manufacturer will work to even further increase the resilience of the aircraft systems to AoA sensor failures so as to further enhance the safety of the aircraft. Boeing will also conduct a complementary Human Factor assessment of its crew alerting system within the next 12 months, with the aim of identifying the need for longer term improvements.

Resumption of flights in Europe

The Airworthiness Directive, which details the aircraft and operational suitability changes, including crew training requirements, must be carried out before each individual plane returns to service, gives the green light from the EASA side for a return to service of the aircraft.

However, scheduling of these mandated actions is a matter for the aircraft operators, under the oversight of Member States’ national aviation authorities, meaning that the actual return to service may take some time. COVID-19 may also have an influence on the pace of return to commercial operations.

In conjunction with the Airworthiness Directive, EASA also issued a Safety Directive (SD) requiring non-European airlines which are holders of EASA third country operator (TCO) authorisation to implement equivalent requirements, including aircrew training. This will allow for the return to service of the 737 MAX when the aircraft concerned are operated under an EASA TCO authorisation into, within or out of the territory of the EASA Member States.

Additional information

In summary, the EASA Airworthiness Directive mandates the following main actions:

Software updates for the flight control computer, including the MCAS
Software updates to display an alert in case of disagreement between the two AoA sensors
Physical separation of wires routed from the cockpit to the stabiliser trim motor
Updates to flight manuals: operational limitations and improved procedures to equip pilots to understand and manage all relevant failure scenarios
Mandatory training for all 737 MAX pilots before they fly the plane again, and updates of the initial and recurrent training of pilots on the MAX
Tests of systems including the AoA sensor system
An operational readiness flight, without passengers, before commercial usage of each aircraft to ensure that all design changes have been correctly implemented and the aircraft successfully and safely brought out of its long period of storage.

For details, see the text of the Airworthiness Directive (AD).

EASA, and regulators in Canada and Brazil, worked closely with the FAA and Boeing throughout the last 20 months to return the plane safely to operations. These three authorities have already approved the aircraft for the return to service.

The EASA AD requires the same physical changes to the aircraft as the FAA, meaning that there will be no software or technical differences between the aircraft operated by the United States operators and by the EASA member states operators (the 27 European Union members plus Iceland, Liechtenstein, Norway and Switzerland). Following the exit of the United Kingdom from the European Union, the UK Civil Aviation Authority is now responsible for clearing the aircraft to operate to/from and within the U.K as well as for U.K. operators.

However, EASA’s requirements differ from the FAA in two main respects. EASA explicitly allows flight crews to intervene to stop a stick shaker from continuing to vibrate once it has been erroneously activated by the system, to prevent this distracting the crew. EASA also, for the time being, mandates that certain types of high-precision landings cannot be performed. The latter is expected to be a short-term restriction. The mandated training for pilots is broadly the same for both authorities.

Some EASA member states issued their own decision prohibiting the operation of the 737 MAX last year for their sovereign airspace. These bans will need to be lifted before the aircraft can fly again in the airspace of these countries. EASA is working closely with the relevant national authorities to achieve this.

During the 28-day public consultation, comments on the AD were received from 38 commenters. These have all been responded to in the Comment Response Document published with the AD. For the SD, there were 6 commenters. Responses to these comments can be found on the Comment Response Document published with the SD. In summary, the comments resulted in some minor changes to the texts, such as corrections to typing errors, updated document references and clarifications required by the commenters. There were no substantive changes made to the actions that need to be implemented.

Boeing reports fourth quarter and 2020 financial results

Boeing issued this report:

Fourth Quarter 2020

Financial results significantly impacted by COVID-19, 737 MAX grounding, and commercial wide body programs
777X program recorded $6.5 billion pre-tax charge; first delivery expected in late 2023
737 MAX began receiving regulatory approval to resume operations and restarted deliveries
Revenue of $15.3 billion, GAAP loss per share of ($14.65) and core (non-GAAP)* loss per share of ($15.25)

Full-Year 2020

Revenue of $58.2 billion, GAAP loss per share of ($20.88) and core (non-GAAP)* loss per share of ($23.25)
Operating cash flow of ($18.4) billion; cash and marketable securities of $25.6 billion
Total backlog of $363 billion, including more than 4,000 commercial airplanes
Strengthening safety processes, improving performance, managing liquidity and transforming for the future

Table 1. Summary Financial Results	Fourth Quarter			Full Year
(Dollars in Millions, except per share data)	2020	2019	Change	2020	2019	Change

Revenues	$15,304	$17,911	(15)%	$58,158	$76,559	(24)%

GAAP
Loss From Operations	($8,049)	($2,204)	NM	($12,767)	($1,975)	NM
Operating Margin	(52.6)%	(12.3)%	NM	(22.0)%	(2.6)%	NM
Net Loss	($8,439)	($1,010)	NM	($11,941)	($636)	NM
Loss Per Share	($14.65)	($1.79)	NM	($20.88)	($1.12)	NM
Operating Cash Flow	($4,009)	($2,220)	NM	($18,410)	($2,446)	NM
Non-GAAP*
Core Operating Loss	($8,377)	($2,526)	NM	($14,150)	($3,390)	NM
Core Operating Margin	(54.7)%	(14.1)%	NM	(24.3)%	(4.4)%	NM
Core Loss Per Share	($15.25)	($2.33)	NM	($23.25)	($3.47)	NM

*Non-GAAP measure; complete definitions of Boeing’s non-GAAP measures are on page 6, “Non-GAAP Measures Disclosures.”

The Boeing Company today reported fourth-quarter revenue of $15.3 billion, reflecting lower commercial deliveries and services volume primarily due to COVID-19 as well as 787 production issues, partially offset by a lower 737 MAX customer considerations charge in the quarter compared to the same period last year (Table 1). GAAP loss per share of ($14.65) and core loss per share (non-GAAP)* of ($15.25) reflected a $6.5 billion pre-tax charge on the 777X program and a tax valuation allowance, partially offset by a lower 737 MAX customer considerations charge. Boeing recorded operating cash flow of ($4.0) billion.

“2020 was a year of profound societal and global disruption which significantly constrained our industry. The deep impact of the pandemic on commercial air travel, coupled with the 737 MAX grounding, challenged our results. I am proud of the resilience and dedication our global team demonstrated in this environment as we strengthened our safety processes, adapted to our market and supported our customers, suppliers, communities and each other,” said Boeing President and Chief Executive Officer Dave Calhoun. “Our balanced portfolio of diverse defense, space and services programs continues to provide important stability as we lay the foundation for our recovery. While the impact of COVID-19 presents continued challenges for commercial aerospace into 2021, we remain confident in our future, squarely-focused on safety, quality and transparency as we rebuild trust and transform our business.”

The return to service of the 737 MAX in the U.S. and several other markets was an important step, and Boeing continues to follow the lead of global regulators and support its customers. Since the FAA’s approval to return to operations, Boeing has delivered over 40 737 MAX aircraft and five airlines have safely returned their fleets to service as of January 25, 2021, safely flying more than 2,700 revenue flights and approximately 5,500 flight hours.

Boeing now anticipates that the first 777X delivery will occur in late 2023. This schedule, and the associated financial impact, reflect a number of factors, including an updated assessment of global certification requirements, the company’s latest assessment of COVID-19 impacts on market demand, and discussions with its customers with respect to aircraft delivery timing.

The company continues to progress through its business transformation effort across five key areas including its infrastructure footprint, overhead and organizational structure, portfolio and investment mix, supply chain health and operational excellence. Boeing will continue these actions in 2021 to preserve liquidity, adapt to the new market, improve performance, sustain key investments and transform its business to be more productive, resilient and competitive for the long term.

Table 2. Cash Flow	Fourth Quarter		Full Year
(Millions)	2020	2019	2020	2019
Operating Cash Flow	($4,009)	($2,220)	($18,410)	($2,446)
Less Additions to Property, Plant & Equipment	($265)	($447)	($1,303)	($1,834)
Free Cash Flow*	($4,274)	($2,667)	($19,713)	($4,280)

*Non-GAAP measure; complete definitions of Boeing’s non-GAAP measures are on page 6, “Non-GAAP Measures Disclosures.”

Operating cash flow was ($4.0) billion in the quarter, reflecting lower commercial deliveries and services volume, as well as timing of receipts and expenditures (Table 2).

Table 3. Cash, Marketable Securities and Debt Balances	Quarter-End
(Billions)	Q4 20	Q3 20
Cash	$7.8	$10.6
Marketable Securities1	$17.8	$16.5
Total	$25.6	$27.1
Debt Balances:
The Boeing Company, net of inter company loans to BCC	$62.0	$59.1
Boeing Capital, including inter company loans	$1.6	$1.9
Total Consolidated Debt	$63.6	$61.0

1 Marketable securities consists primarily of time deposits due within one year classified as “short-term investments.”

Cash and investments in marketable securities decreased to $25.6 billion, compared to $27.1 billion at the beginning of the quarter, primarily driven by operating cash outflows partially offset by changes in the debt balance (Table 3).

Total company backlog at quarter-end was $363 billion.

Segment Results

Commercial Airplanes

Table 4. Commercial Airplanes	Fourth Quarter			Full Year
(Dollars in Millions)	2020	2019	Change	2020	2019	Change

Commercial Airplanes Deliveries	59	79	(25)%	157	380	(59)%

Revenues	$4,728	$7,462	(37)%	$16,162	$32,255	(50)%
Loss from Operations	($7,648)	($2,844)	NM	($13,847)	($6,657)	NM
Operating Margin	(161.8)%	(38.1)%	NM	(85.7)%	(20.6)%	NM

Commercial Airplanes fourth-quarter revenue decreased to $4.7 billion, driven by lower widebody delivery volume due to COVID-19 impacts as well as 787 production issues, partially offset by higher 737 deliveries and a lower 737 MAX customer consideration charge in the quarter compared to the same period last year (Table 4). Fourth-quarter operating margin decreased to (161.8) percent, primarily driven by a $6.5 billion pre-tax charge on the 777X program, lower delivery volume, and $468 million of abnormal production costs related to the 737 program, partially offset by a lower 737 MAX customer consideration charge.

Commercial Airplanes production rate assumptions reflect the continued impacts of COVID-19 on commercial demand, and the company will continue to assess them on an ongoing basis. The 737 program is currently producing at a low rate and expects to gradually increase production to 31 per month in early 2022 with further gradual increases to correspond with market demand. The 787 program plans to transition its production rate to 5 per month in March 2021, at which point 787 final assembly will be consolidated to Boeing South Carolina.

As discussed above, Commercial Airplanes now expects first delivery of the 777X to occur in late 2023 and has recorded a $6.5 billion reach-forward loss on the 777X program. Among the factors contributing to the revised first delivery schedule and reach-forward loss are an updated assessment of certification requirements based on ongoing communication with civil aviation authorities, an updated assessment of market demand based on continued dialogue with customers, resulting adjustments to production rates and the program accounting quantity, increased change incorporation costs, and associated customer and supply chain impacts. The production rate expectation for the combined 777/777X program remains at 2 per month in 2021.

Commercial Airplanes captured orders for 75 737 aircraft from Ryanair and eight 777 freighters from DHL, as well as a commitment for 23 737 aircraft from Alaska Airlines. Commercial Airplanes delivered 59 airplanes during the quarter, and backlog included over 4,000 airplanes valued at $282 billion.

Defense, Space & Security

Table 5. Defense, Space & Security	Fourth Quarter			Full Year
(Dollars in Millions)	2020	2019	Change	2020	2019	Change

Revenues	$6,779	$5,927	14%	$26,257	$26,095	1%
Earnings from Operations	$502	$34	1,376%	$1,539	$2,615	(41)%
Operating Margin	7.4%	0.6%	6.8 Pts	5.9%	10.0%	(4.1) Pts

Defense, Space & Security fourth-quarter revenue increased to $6.8 billion, primarily driven by higher volume on fighter programs and the rest of the portfolio as well as a charge on the Commercial Crew program in the same period last year (Table 5). Fourth-quarter operating margin increased to 7.4 percent reflecting more favorable performance on multiple programs compared with the same period last year, partially offset by a $275 million pre-tax charge on the KC-46A Tanker program primarily due to production inefficiencies including impacts of COVID-19 disruption.

During the quarter, Defense, Space & Security was awarded contracts for two KC-46A aircraft for Japan and AEW&C upgrades for the Republic of Korea Air Force. Defense, Space & Security achieved first flight of the MQ-25 unmanned aircraft with an aerial refueling store and demonstrated ski-jump launch capability of the F/A-18 Super Hornet for the Indian Navy. Also in the quarter, Defense, Space & Security completed engineering design review for the Wideband Global SATCOM-11+ communications satellite and critical design review of the Space Launch System Exploration Upper Stage for NASA.

Backlog at Defense, Space & Security was $61 billion, of which 32 percent represents orders from customers outside the U.S.

Global Services

Table 6. Global Services	Fourth Quarter			Full Year
(Dollars in Millions)	2020	2019	Change	2020	2019	Change

Revenues	$3,733	$4,648	(20)%	$15,543	$18,468	(16)%
Earnings from Operations	$143	$684	(79)%	$450	$2,697	(83)%
Operating Margin	3.8%	14.7%	(10.9) Pts	2.9%	14.6%	(11.7) Pts

Global Services fourth-quarter revenue decreased to $3.7 billion, driven by lower commercial services volume due to COVID-19 (Table 6). Fourth-quarter operating margin decreased to 3.8 percent primarily due to lower commercial services volume and $290 million of pre-tax charges related to asset impairments driven by COVID-19.

During the quarter, Global Services was awarded a Performance Based Logistics contract for the Republic of Singapore Air Force F-15SG fleet, secured a F-15 spares and logistics support contract with the Qatar Emiri Air Force, and was selected to provide P-8A training for the Royal New Zealand Air Force. Global Services also announced a 10-year digital services agreement with Frontier Airlines.

Additional Financial Information

Table 7. Additional Financial Information	Fourth Quarter		Full Year
(Dollars in Millions)	2020	2019	2020	2019
Revenues
Boeing Capital	$56	$37	$261	$244
Unallocated items, eliminations and other	$8	($163)	($65)	($503)
(Loss)/Earnings from Operations
Boeing Capital	$16	($58)	$63	$28
FAS/CAS service cost adjustment	$328	$322	$1,383	$1,415
Other unallocated items and eliminations	($1,390)	($342)	($2,355)	($2,073)
Other income, net	$122	$104	$447	$438
Interest and debt expense	($698)	($242)	($2,156)	($722)
Effective tax rate	2.2%	56.9%	17.5%	71.8%

At quarter-end, Boeing Capital’s net portfolio balance was $2.0 billion. The change in revenue from other unallocated items and eliminations was primarily due to the timing of eliminations for inter company aircraft deliveries. Other unallocated items and eliminations included a $744 million charge related to the previously announced agreement between Boeing and the U.S. Department of Justice in January 2021. Interest and debt expense increased due to higher debt balances. The fourth quarter 2020 effective tax rate primarily reflects an additional valuation allowance on certain deferred income tax assets, partially offset by the benefit of the five year net operating loss carry back provision in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Boeing announces fourth quarter deliveries

The Boeing Company announced today major program deliveries across its commercial and defense operations for the fourth quarter of 2020.

“Through the global pandemic, we took meaningful steps to adapt to our new market, transform our business and deliver for our commercial, defense, space and services customers in 2020,” said Greg Smith, Boeing executive vice president of Enterprise Operations and chief financial officer.

“The resumption of 737 MAX deliveries in December was a key milestone as we strengthen safety and quality across our enterprise. We also continued comprehensive inspections of our 787 airplanes to ensure they meet our highest quality standards prior to delivery. While limiting our 787 deliveries for the quarter, these comprehensive inspections represent our focus on safety, quality and transparency, and we’re confident that we’re taking the right steps for our customers and for the long term health of the 787 program. As we continue navigating through the pandemic, we’re working closely with our global customers and monitoring the slow international traffic recovery to align supply with market demand across our widebody programs. In 2021, we’ll continue taking the right actions to enhance our safety culture, preserve liquidity and transform our business for the future.”

Major program deliveries during the fourth quarter were as follows:

Major Programs	4th Quarter 2020	Year-to- Date 2020

Commercial Airplanes Programs
737	31	43
747	3	5
767	10	30
777	11	26
787	4	53
Total	59	157

Defense, Space & Security Programs
AH-64 Apache (New)	1	19
AH-64 Apache (Remanufactured)	8	52
C-40A	—	—
CH-47 Chinook (New)	8	27
CH-47 Chinook (Renewed)	—	3
F-15 Models	1	4
F/A-18 Models	6	20
KC-46 Tanker	4	14
P-8 Models	6	15
Commercial and Civil Satellites	—	—
Military Satellites	—	—

Note: Delivery information is not considered final until quarterly financial results are issued.

Boeing responds to FAA approval to resume 737 MAX operations

Boeing issued this statement (note: Boeing is no longer using the MAX term in the designation):

The U.S. Federal Aviation Administration (FAA) today rescinded the order that halted commercial operations of Boeing 737-8s and 737-9s. The move will allow airlines that are under the FAA’s jurisdiction, including those in the U.S., to take the steps necessary to resume service and Boeing to begin making deliveries.

“We will never forget the lives lost in the two tragic accidents that led to the decision to suspend operations,” said David Calhoun, chief executive officer of The Boeing Company. “These events and the lessons we have learned as a result have reshaped our company and further focused our attention on our core values of safety, quality and integrity.”

Throughout the past 20 months, Boeing has worked closely with airlines, providing them with detailed recommendations regarding long-term storage and ensuring their input was part of the effort to safely return the airplanes to service.

An Airworthiness Directive issued by the FAA spells out the requirements that must be met before U.S. carriers can resume service, including installing software enhancements, completing wire separation modifications, conducting pilot training and accomplishing thorough de-preservation activities that will ensure the airplanes are ready for service.

“The FAA’s directive is an important milestone,” said Stan Deal, president and chief executive officer of Boeing Commercial Airplanes. “We will continue to work with regulators around the world and our customers to return the airplane back into service worldwide.”

In addition to changes made to the airplane and pilot training, Boeing has taken three important steps to strengthen its focus on safety and quality.

Organizational Alignment: More than 50,000 engineers have been brought together in a single organization that includes a new Product & Services Safety unit, unifying safety responsibilities across the company.
Cultural Focus: Engineers have been further empowered to improve safety and quality. The company is identifying, diagnosing and resolving issues with a higher level of transparency and immediacy.
Process Enhancements: By adopting next-generation design processes, the company is enabling greater levels of first-time quality.

Canada takes a different approach for the Boeing 737 MAX

Statement by Minister Garneau on Federal Aviation Administration’s certification of changes to the Boeing 737 MAX aircraft:

“Our government remains committed to keeping Canadians, the travelling public, and the transportation system safe and secure.

“We acknowledge that the United States Federal Aviation Administration (FAA) has released an Airworthiness Directive for the Boeing 737 MAX aircraft. Through this directive, the FAA is mandating its approved changes made to the Boeing 737 MAX aircraft, and confirms it can return to service in U.S. airspace.

“Transport Canada has worked extensively with the FAA and other key certifying authorities, including the European Union Aviation Safety Agency (EASA) and the National Civil Aviation Agency of Brazil (ANAC), as well as the three Canadian operators of the Boeing 737 MAX aircraft, and their pilot unions throughout the validation process of the aircraft to address all factors necessary toward a safe return to service of the aircraft.

“Transport Canada safety experts continue their independent validation process to determine whether to approve the proposed changes to the aircraft. We expect this process to conclude very soon. However, there will be differences between what the FAA has approved today, and what Canada will require for its operators. These differences will include additional procedures on the flight deck and pre-flight, as well as differences in training.

“The commercial flight restrictions for the operation of the Boeing 737 MAX aircraft in Canadian airspace remain in effect and will not be lifted until the department is fully satisfied that all its safety concerns have been addressed, and that enhanced flight crew procedures and training are in place in Canada.”

Poll:

FAA clears the Boeing 737 MAX to return to service

Federal Aviation Administration-FAA issued this statement today:

FAA Administrator Steve Dickson today signed an order (PDF) that paves the way for the Boeing 737 MAX to return to commercial service. Administrator Dickson’s action followed a comprehensive and methodical safety review process (PDF) that took 20 months to complete. During that time, FAA employees worked diligently to identify and address the safety issues that played a role in the tragic loss of 346 lives aboard Lion Air Flight 610 and Ethiopian Airlines Flight 302. Throughout our transparent process, we cooperated closely with our foreign counterparts on every aspect of the return to service. Additionally, Administrator Dickson personally took the recommended pilot training and piloted the Boeing 737 MAX, so he could experience the handling of the aircraft firsthand.

In addition to rescinding the order that grounded the aircraft, the FAA today published an Airworthiness Directive (PDF) specifying design changes that must be made before the aircraft returns to service, issued a Continued Airworthiness Notification to the International Community (CANIC), and published the MAX training requirements. (PDF) These actions do not allow the MAX to return immediately to the skies. The FAA must approve 737 MAX pilot training program revisions for each U.S. airline operating the MAX and will retain its authority to issue airworthiness certificates and export certificates of airworthiness for all new 737 MAX aircraft manufactured since the FAA issued the grounding order. Furthermore, airlines that have parked their MAX aircraft must take required maintenance steps to prepare them to fly again.

The design and certification of this aircraft included an unprecedented level of collaborative and independent reviews by aviation authorities around the world. Those regulators have indicated that Boeing’s design changes, together with the changes to crew procedures and training enhancements, will give them the confidence to validate the aircraft as safe to fly in their respective countries and regions. Following the return to service, the FAA will continue to work closely with our foreign civil aviation partners to evaluate any potential additional enhancements for the aircraft. The agency also will conduct the same rigorous, continued operational safety oversight of the MAX that we provide for the entire U.S. commercial fleet.

View a video from Administrator Dickson.

Photo: Joe G. Walker.

Boeing to consolidate 787 production in South Carolina in 2021

Boeing made this announcement:

As the airline industry continues to address the impact of COVID-19, The Boeing Company said today it will consolidate production of 787 jets at its facility in North Charleston, S.C., starting in mid-2021, according to the company’s best estimate. The decision comes as the company is strategically taking action to preserve liquidity and reposition certain lines of business in the current global environment to enhance efficiency and improve performance for the long-term.

While Boeing’s versatile 787 family has outperformed other widebody airplanes during the challenging market downturn, its production system has been adjusted to accommodate the current difficult market environment while positioning the 787 family to ramp up production as air travel increases.

“Our team in Puget Sound will continue to focus on efficiently building our 737, 747, 767 and 777 airplane families, and both sites will drive Boeing initiatives to further enhance safety, quality, and operational excellence.”

The company began assembling 787-8 and 787-9 airplanes at its Everett site in 2007, and brought the North Charleston facility on line as a second final assembly line in 2010. However, only the North Charleston site is set up to build the larger 787-10 model. Production of the smaller 787 models will continue in Everett until the program transitions to the previously-announced production rate of six airplanes a month in 2021.

In July, Boeing announced an in-depth study into the feasibility of producing 787s at a single location. The review examined the impacts and benefits to Boeing customers, suppliers, employees and the overall health of the production system. The 787 study is part of an enterprise review underway to reassess all aspects of Boeing’s facility footprint, organizational structure, portfolio and investment mix, and supply chain health and stability.

This analysis confirmed the feasibility and efficiency gains created by consolidation, which enables the company to accelerate improvements and target investments to better support customers.

“We recognize that production decisions can impact our teammates, industry and our community partners,” said Deal. “We extensively evaluated every aspect of the program and engaged with our stakeholders on how we can best partner moving forward. These efforts will further refine 787 production and enhance the airplane’s value proposition.”

Boeing said it is assessing potential impacts to employment in Everett and North Charleston and will communicate any changes directly to its employees.

Boeing licenses Ultraviolet Wand to Healthe, Inc. to counter COVID-19

Boeing entered into a patent and technology license with Florida-based Healthe® Inc. today under which Healthe will manufacture an ultraviolet (UV) wand designed to sanitize airplane interiors. Boeing designed and developed the UV wand as part of the company’s Confident Travel Initiative (CTI) to support customers and enhance the safety and well-being of passengers and crews during the COVID-19 pandemic.

“The UV wand is designed to be more effective than similar devices. It quickly disinfects surfaces on an airplane and further strengthens other layers of protection for passengers and crew,” said Mike Delaney, who leads Boeing’s CTI efforts. “Boeing spent six months transforming an idea for the wand into a working model, and Healthe will now take that prototype and make it available to the world at large.”

Healthe will produce and distribute the commercial wand, helping airlines and potentially others combat the coronavirus pandemic. The technology could be available for airlines in late fall. The device is an addition to sanitizing and protective measures already in place, which include the use of high-efficiency particulate air filters that trap more than 99.9% of particulates and prevent them from re-circulating back to the cabin.

“We are proud to be assisting Boeing as they work with their partner airlines to enhance in-cabin plane sanitization efforts. This could also benefit schools, hospitals, offices, wherever pathogens go,” said Abe Morris, Healthe executive chairman. “As we ramp up deployment of our cutting-edge UVC and Far-UVC 222 light solutions across many sectors, this new commercial-grade wand will be another powerful tool in the sanitization arsenal to protect passengers against the spread of harmful viruses.”

The UV wand uses 222 nanometer UVC light. Research indicates 222 nanometer UVC inactivates pathogens effectively.

Using the self-contained apparatus that resembles a carry-on suitcase, crews can pass UV light over high-touch surfaces, sanitizing everywhere the light reaches. The UV wand is particularly effective in compact spaces and sanitizes a flight deck in less than 15 minutes.

As part of CTI, Boeing solicited feedback from multiple industry sources, which aided in quickly validating this technology. Etihad Airways was the first to evaluate the device, and the UV wand was demonstrated on the Etihad 787-10 ecoDemonstrator airplane on Aug. 21.

The mission of Boeing’s Confident Travel Initiative is to be a leader in the global effort to provide passengers and crew a safe, healthy and efficient travel experience.

Boeing receives an order for two 737-800 Boeing Converted Freighters (BCF)

Boeing has made this announcement:

Boeing has announced a firm order from an unidentified customer for two 737-800 Boeing Converted Freighters (BCF), as well as agreements to open additional conversion lines in Guangzhou, China, and Singapore to meet strong market demand.

Based on the popular Next-Generation 737, the 737-800BCF offers operators newer technology, lower fuel consumption and higher reliability than other standard-body freighters. Primarily used to carry express cargo on domestic or short-haul routes, the airplane is capable of carrying up to 23.9 tons (52,800 pounds) and flying up to 2,000 nautical miles (3,750 kilometers).

The 737-800BCF now has 134 orders and commitments.

The new 737-800BCF line at Guangzhou Aircraft Maintenance Engineering Company Limited (GAMECO) is scheduled to open in early 2021, marking the MRO’s second conversion line for the market-leading 737-800BCF. To date, Boeing has delivered 36 737-800BCF to more than 10 operators across four continents.

Boeing will also add a second conversion line for its widebody converted freighter, the 767-300BCF, at ST Engineering’s facility in Singapore. The second line is scheduled to open later this year.

House Final Committee Report on the Boeing 737 MAX

Chair of the House Committee on Transportation and Infrastructure Peter DeFazio (D-OR) and Chair of the Subcommittee on Aviation Rick Larsen (D-WA) one September 16, 2020 released the Committee’s final report on the Boeing 737 MAX. This report, prepared by Majority Staff, lays out the serious flaws and missteps in the design, development, and certification of the aircraft, which entered commercial service in 2017 before suffering two deadly crashes within five months of each other that killed a total of 346 people, including eight Americans.

The Committee’s 238-page report, which points to repeated and serious failures by both The Boeing Company (Boeing) and the Federal Aviation Administration (FAA), contains five central themes and includes more than six dozen investigative findings. These themes include:

Production pressures that jeopardized the safety of the flying public. There was tremendous financial pressure on Boeing and the 737 MAX program to compete with Airbus’ new A320neo aircraft. Among other things, this pressure resulted in extensive efforts to cut costs, maintain the 737 MAX program schedule, and avoid slowing the 737 MAX production line.
Faulty Design and Performance Assumptions. Boeing made fundamentally faulty assumptions about critical technologies on the 737 MAX, most notably with MCAS, the software designed to automatically push the airplane’s nose down in certain conditions. Boeing also expected that pilots, who were largely unaware that MCAS existed, would be able to mitigate any potential malfunction.
Culture of Concealment. Boeing withheld crucial information from the FAA, its customers, and 737 MAX pilots, including internal test data that revealed it took a Boeing test pilot more than 10 seconds to diagnose and respond to uncommanded MCAS activation in a flight simulator, a condition the pilot described as “catastrophic.” Federal guidelines assume pilots will respond to this condition within four seconds.
Conflicted Representation. The FAA’s current oversight structure with respect to Boeing creates inherent conflicts of interest that have jeopardized the safety of the flying public. The report documents multiple instances in which Boeing employees who have been authorized to perform work on behalf of the FAA failed to alert the FAA to potential safety and/or certification issues.
Boeing’s Influence Over the FAA’s Oversight Structure. Multiple career FAA officials have documented examples where FAA management overruled a determination of the FAA’s own technical experts at the behest of Boeing. These examples are consistent with results of a recent draft FAA employee “safety culture” survey that showed many FAA employees believed its senior leaders are more concerned with helping industry achieve its goals and are not held accountable for safety-related decisions.

“Our report lays out disturbing revelations about how Boeing—under pressure to compete with Airbus and deliver profits for Wall Street—escaped scrutiny from the FAA, withheld critical information from pilots, and ultimately put planes into service that killed 346 innocent people. What’s particularly infuriating is how Boeing and FAA both gambled with public safety in the critical time period between the two crashes,” Chair DeFazio said. “On behalf of the families of the victims of both crashes, as well as anyone who steps on a plane expecting to arrive at their destination safely, we are making this report public to put a spotlight not only on the broken safety culture at Boeing but also the gaps in the regulatory system at the FAA that allowed this fatally-flawed plane into service. Critically, our report gives Congress a roadmap on the steps we must take to reinforce aviation safety and regulatory transparency, increase Federal oversight, and improve corporate accountability to help ensure the story of the Boeing 737 MAX is never, ever repeated.”

“The Committee’s thorough investigation uncovered errors that are difficult to hear, but necessary to confront about the 737 MAX certification,” Chair Larsen said. “This report, combined with the findings and recommendations from the Lion Air and Ethiopian Airlines investigations, National Transportation Safety Board, Joint Authorities Technical Review and other entities, serve as a roadmap for changes to the FAA certification process. The 346 victims of the two tragic crashes and their families, as well as the traveling public rightfully expect Congress to act. As the Committee moves into the next phase of oversight, I will continue to work with Chair DeFazio and my colleagues to address the significant cultural and structural deficiencies identified in the report in order to improve safety.”

Additional information:

At the direction of Chair DeFazio and Subcommittee Chair Larsen, the Committee launched an investigation into the design, development, and certification of the 737 MAX, and related issues, in March 2019, shortly after the second crash involving a Boeing 737 MAX aircraft. As part of the 18-month long investigation, the Committee held five public hearings with more than 20 witnesses; wrote nearly two dozen oversight letters, obtained an estimated 600,000 pages of documents from Boeing, the FAA, and others; received information and insight from former and current employees who contacted the Committee directly through the Committee’s whistleblower link; and interviewed dozens of current and former Boeing and FAA employees.

To access the Final Report, newly released accompanying records, including transcribed interviews of both senior Boeing and FAA officials about the 737 MAX, as well as past statements, hearing video, and more, click here.

Boeing Statement on the House Transportation and Infrastructure Committee Report on 737 MAX

Boeing cooperated fully and extensively with the Committee’s inquiry since it began in early 2019. We have been hard at work strengthening our safety culture and rebuilding trust with our customers, regulators, and the flying public. The passengers and crew on board Lion Air Flight 610 and Ethiopian Airlines Flight 302, as well as their loved ones, continue to be in our thoughts and prayers.

Multiple committees, experts, and governmental authorities have examined issues related to the MAX, and we have incorporated many of their recommendations, as well as the results of our own internal reviews, into the 737 MAX and the overall airplane design process. The revised design of the MAX has received intensive internal and regulatory review, including more than 375,000 engineering and test hours and 1,300 test flights. Once the FAA and other regulators have determined the MAX can safely return to service, it will be one of the most thoroughly scrutinized aircraft in history, and we have full confidence in its safety. We have also taken steps to bolster safety across our company, consulting outside experts and learning from best practices in other industries. We have set up a new safety organization to enhance and standardize safety practices, restructured our engineering organization to give engineers a stronger voice and a more direct line to share concerns with top management, created a permanent Aerospace Safety Committee of our Board of Directors as well as expanded the role of the Safety Promotion Center.

We have learned many hard lessons as a company from the accidents of Lion Air Flight 610 and Ethiopian Airlines Flight 302, and from the mistakes we have made. As this report recognizes, we have made fundamental changes to our company as a result, and continue to look for ways to improve. Change is always hard and requires daily commitment, but we as a company are dedicated to doing the work.

For more information on steps Boeing is taking to strengthen safety, visit our 2020 Proxy Statement and our 737 MAX Resources Page.