Boeing CEO on 737 explosion: “We created the problem”

Boeing CEO on 737 explosion: “We created the problem”

New York

Boeing CEO Dave Calhoun said Boeing was responsible for a 737 Max 9 door jamb explosion during takeoff earlier this month, and said Boeing should have done better than it did in this situation.

“We created the problem and we understand that,” he told investors on a call after the company reported its latest quarterly loss. “No matter what the outcome, Boeing is responsible for what happened. Whatever the specific cause of the accident, such an incident should not occur on an aircraft leaving one of our factories. We just have to be better.”

Boeing did not provide the financial guidance it usually provides to investors and did not say when it might introduce two new versions of the 737 Max, which it has promised airlines but have not been certified by the Federal Aviation Administration.

“While we often use this time of year to share or update our financial and operational goals, now is not the time,” Calhoun said in comments to Boeing employees published by the company.

On January 5, the explosion of a door stopper on an Alaska Airlines plane put the company on the defensive again. Fortunately, no one was killed as the crew was able to make an emergency landing minutes after the hole opened, but the short flight terrified passengers outside the plane with mobile phones and torn clothes. This led to a three-week grounding of the Boeing 737 Max 9 as inspections revealed problems with the installation of other door jambs.

“I’ve had tough and direct conversations with our customers, regulators and lawmakers,” he said. “They are disappointed and we have a lot to prove to earn the trust of our stakeholders.”

Calhoun’s comments came as the manufacturer posted another loss for 2023 and did not provide its financial forecast for 2024, which includes expectations of Federal Aviation Administration approval for the longer 737 Max 10 and shorter 737 Max versions. came 7.

After the doorstop incident, the FAA said it would not allow the company to move forward with planned increases in production of existing models. And two major customers, United Airlines and Southwest Airlines, said last week they were indefinitely delaying their hoped-for delivery plans for both models.

“Our people at the factory know better than anyone what we need to do to improve,” Calhoun said. “We’re going to go slow, we’re not going to rush the system and we’re going to take our time to get it right.”

“Increased scrutiny – whether from ourselves, our regulator or others – will make us better,” he said.

In an interview with CNBC on Wednesday, Calhoun said he would not speculate on what the National Transportation Safety Board, which is investigating the incident, will find as a cause. But he said, “I’m sure we have it [door] the plug is completely under control.”

The 737 Max 9 also received a vote of confidence from NTSB Chair Jennifer Homendy on Wednesday.

“I wouldn’t have a problem getting into the Max 9 tomorrow and flying,” Homendy told CNN in an interview. “That’s all I have to say about aviation security in general. It is safe, but there are problems.”

He said the NTSB was in the “final stages” of preparing a preliminary report on the Alaska Air incident.

“We want to make sure it’s true,” Homendy said of the agency’s preliminary findings. “It’s a somewhat complex issue with many parts.”

In an appearance on CNBC, Calhoun also defended the company’s decision not to issue updated financial guidance. The company said it now produces 38 737 Max jets per month, but that’s less than it needs to return to profitability on its best-selling plane. After the Alaska Air incident, the FAA’s restriction on increasing production of the Max will delay Boeing’s ability to return to profitability.

“Our whole focus, our whole focus as a company, is to make sure that we are never insecure [incident] Again, learning everything we can from the accident, learning everything we can from the FAA audit, learning everything we can … the ideas that our own people have given us,” he said.

Asked whether Boeing has lost the trust of airline customers, he said that until now, customers tell the company that they are loyal to Boeing.

“Was that a shot at them? Absolutely. As I said, these moments shake all of us – Boeing, our people, our customers, everyone to the bone.” “Our job is to restore trust at every level. They want Boeing to win. They want us to succeed.”

In good news for the troubled company, Boeing reported an adjusted loss of 47 cents a share, or about $285 million, in the fourth quarter, better than a loss of $1.75 a share and a loss of 78 cents a share a year earlier. Analysts’ estimates polled by Refinitiv.

The company hasn’t reported losses in not just one quarter since the end of 2019, but almost always reported bigger-than-expected losses.

Boeing shares, which have lost about 20% of their value since the Alaska Air incident, were slightly higher in premarket trading Wednesday on Calhoun’s comments and the quarterly report.

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