Boeing Faces Backlash From Airline Chiefs

baua

Boeing Faces Backlash From Airline Chiefs


Airline bosses have lashed out at Boeing over a streak of safety and production problems — loose bolts, a discarded wrench found under the floorboards, delayed shipments — as scrutiny over the company’s manufacturing processes intensifies.

“I am angry,” Ben Minicucci, the chief executive of Alaska Airlines, told NBC News on Tuesday after the carrier found “many” loose bolts while checking its fleet of Boeing 737 Max 9 jetliners after a door plug flew off one of the planes in midair on Jan. 5. “My demand on Boeing is, What are they going to do to improve their quality programs in-house?”

After the incident, the Federal Aviation Administration grounded around 170 Max 9 jets until they are inspected and said it would investigate whether Boeing failed to ensure that the plane was safe.

Scott Kirby, the United Airlines chief executive, told CNBC on Tuesday that the Max 9 grounding was “probably the straw that broke the camel’s back for us.” He also criticized production delays of another Boeing aircraft the airline had ordered, the Max 10, saying he doubted the planes would be delivered anytime soon.

“We’re going to at least build a plan that doesn’t have the Max 10 in it,” Mr. Kirby said.

It’s an uncommon escalation: Airlines and their manufacturers typically enjoy a symbiotic relationship, with carriers often competing with one another to place orders for new jets, which can have yearslong wait lists. Along with the European aircraft manufacturer Airbus, Boeing makes the majority of the world’s commercial jets, limiting options for airlines that are seeking new planes.

“Boeing’s maintenance and production faults over the last few months are unprecedented, so it’s not surprising that airlines are beyond frustrated and taking unprecedented behavior themselves,” said Xavier Smith, director of energy and industrials research at AlphaSense.

But at this point, criticizing Boeing may be the most that the chief executives can do to vent their frustration without stoking panic about plane safety.

Jonnathan Handshoe, an airline analyst for CFRA Research, said the public admonishments amounted to reassuring passengers that the airlines were concerned about safety while impressing upon Boeing the severity of the crisis.

“It’s more like: ‘Hey, we’re calling you out. This is an issue. It needs to be fixed because there are clearly quality control issues,’” Mr. Handshoe said.

Stan Deal, chief executive of Boeing’s commercial plane unit, said in a statement on Tuesday that the company had “let down our airline customers” and was “deeply sorry for the significant disruption to them, their employees and their passengers.”

Mr. Handshoe said the airlines could theoretically void large orders of new Boeing planes — United placed an order of 50 Boeing 787 Dreamliners in October and a year earlier said it planned to buy 100 by 2032 — but given existing headwinds and market constraints, they were unlikely to do so.

United, like other airlines, is trying to upgrade its fleet to more fuel-efficient planes. Since the F.A.A. ordered the grounding of the Max 9, airlines have been forced to use older, less fuel-efficient planes. That has increased their fuel costs, Mr. Handshoe said, even as the cost of jet fuel has abated in recent months.

Another issue is that the F.A.A.’s order has reduced the airlines’ fleets at a time when they are trying to expand. The diminished capacity has raised costs, which have been passed down to consumers.

The constraints are heightened for a company like Alaska Airlines, which has a smaller fleet, one that it has sought to expand with a proposed $1.9 billion purchase of Hawaiian Airlines.

Since the Jan. 5 incident, Boeing’s stock has fallen more than 13 percent, while Alaska’s has fallen 5 percent.

Some airline executives have avoided criticizing Boeing, even going so far as to express confidence in the manufacturer.

“Boeing is so pivotal to our industry,” Delta Air Lines’ chief executive, Ed Bastian, said during a Jan. 12 appearance on CNBC. “It’s pivotal to our economy, and they will figure this thing out,” Delta, he noted, flies neither the Max nor the 787.

Dave Calhoun, who became Boeing’s chief executive to right the company after fatal Max crashes in 2018 and 2019, is meeting this week with senators including Maria Cantwell, a Washington Democrat and chair of the Commerce Committee. Ms. Cantwell said last week that she planned to hold hearings on the Max 9 groundings.

Boeing’s woes may have a lasting impact. Michael Leskinen, United’s chief financial officer, told analysts that the groundings would dent growth in the “coming years.” Michael O’Leary, the chief executive of Ryanair, a low-cost European airline that is one of Boeing’s biggest customers, also has doubts that the Max 10 will be delivered soon.

Mark Walker contributed reporting.

Tesla police cruiser, Trump voters love solar, and at least the mines will be nice

On today’s episode of Quick Charge, I, for one, welcome our new insect overlords. I’d…

78% of Trump voters support Biden’s clean energy incentives

Photo: Sunrun Support for Biden’s federal clean energy incentives cuts across party lines – 78%…

Tesla and Mercedes-Benz recognized for their ‘human rights diligence’ in making EVs

Amnesty International recognized Tesla and Mercedes-Benz for their “human rights diligence” in manufacturing their electric…