As the eight-month mark since Transport Canada grounded the Boeing 737 MAX 8 fleet back in March 2018 looms ahead, the company could stand to lose billions of dollars in losses, as hundreds of planes remain parked on the tarmac.
Seeing no shortage of crisis since two of its MAX 8 planes were involved in deadly crashes, Boeing has made headlines since last year, regarding its return to the skies. Following the Ethiopian Airlines crash, on Mar. 27, Boeing announced that it would conduct additional pilot training and an upgrade to the 737 MAX MCAS software system, the failure of which was later attributed to the Lion Air and Ethiopian Airlines crashes.
In April 2018, the company sliced production of the MAX 8 by nearly 20 per cent, and then in June, admitted another flaw was identified in its MCAS software system, despite months of testing and in-flight simulation. Then, one month later, the company came under fire after allegations that it had outsourced its MAX 8 software testing for $9 an hour, as opposed to using its own team of senior engineers.
In July, the company reported a $5.6 billion reduction of revenue and pre-tax earnings in the second quarter. By July, the total losses incurred totalled roughly $8B, The Globe and Mail reports. At that time, Boeing assumed that regulatory approval of the 737 MAX 8's return to service in the U.S. and other jurisdictions would begin early in the fourth quarter 2019, but now, the planes will be grounded until at least February 2020, with many airlines, Air Canada included, revising their flying schedules.
According to the Globe and Mail, Reuters reported that stocks plummeted after "a series of internal messages from a former Boeing pilot described the plane’s software as behaving erratically months before the jet entered service."
According to a recent press release, Boeing says that it has made significant progress over the past several months in support of safely returning the 737 MAX to service as the company continues to work with the FAA and other global regulators on the process laid out for certifying the 737 MAX software and related training updates.
On Sept. 30, Boeing announced the formation of a product and services safety organization that will review all aspects of product safety and maintain oversight of its accident investigation team and the company’s safety review boards.
The company also stated that it is providing 24/7 fleet support to airlines, many of which have had to optimize their current fleet, consolidate flights on larger aircraft and extend leases on aircraft to make up for the lack of 737 MAX 8 aircraft.
Don't miss a single travel story: subscribe to PAX today!