Regulators push Boeing on plan for 'systemic change'

Boeing will continue to face increased government inspections and limits on production, as regulators say "systemic change" is needed to rebuild confidence in the safety of its planes.

The aerospace giant presented regulators with a plan on Thursday aimed at improving the quality of its aircraft.

After the meeting, the head of the Federal Aviation Administration (FAA) said the agency would continue to meet weekly with senior executives to monitor its implementation.

“That’s really the hard part,” FAA administrator Mike Whitaker said, adding that he could not give a time frame for when the current production cap on planes might be lifted.

"I don't think it will happen in the next few months,” he said.

Boeing has been in the spotlight since an unused door fell off a brand new 737 Max plane during a flight operated by Alaska Airlines in January, leaving a gaping hole on the side of the plane.

But concerns about Boeing's attitudes toward safety and quality control conditions in its factories are not new.

The company faced intense criticism five years ago, after two 737 Max aircraft were lost in separate, but almost identical accidents, killing 346 people.

Dave Calhoun, Boeing's outgoing chief executive, said many elements in the plan were already under way and the company was "committed" to the plan's execution.

The said the company will continue to work under the FAA's oversight.

January's incident, which investigators said was due to missing bolts, raised new doubts about its corporate culture and manufacturing approach.

Lawsuits

Boeing is now facing numerous lawsuits, as well as the threat of criminal prosecution for violating the terms of a settlement reached after the fatal plane crashes in 2018 and 2019.

The FAA, which had stepped up its oversight in the wake of the accident, had imposed a production cap on the company and set a 90-day deadline for Boeing to develop a comprehensive plan to address regulators' concerns.

Those steps were presented during a three hour meeting on Thursday.

The plan builds on some actions Boeing had already announced, such as significantly slowing its manufacturing pace and boosting staff training.

The company said it was also re-introducing daily compliance checks, investing in new tools and equipment, simplifying its procedures, and pushing managers to spend more time on the factory floor.

But Scott Hamilton, managing director of aviation consultancy Leeham Company, said Boeing's plan gave him "a sense of déjà vu".

"After the 2018-19 737 Max accidents killed the 346 people, Boeing announced a litany of safety innovations or safety initiatives and here we are five years later still doing more safety initiatives.

"I’ve got to wonder what happened to the outcome or the success or the ignoring of those initiatives that were announced five years ago?”

Mr Hamilton said the responsibility for that first set of measures being - or not being - implemented rests with Mr Calhoun because he became chief executive in January 2020 "right after some of these initiatives were announced".

Mr Calhoun will get a pay package worth $33m (£26m) when he steps down as Boeing's chief executive at the end of the year. He will stay on as a board member.

But Mr Hamilton added that the FAA "has some answers to provide because they too were involved in trying to make sure that Boeing became safer after the first Max crisis".

Mr Whitaker said the FAA would maintain its aggressive oversight of the company to ensure the goals are met.

“Systemic change isn't easy but in this case is absolutely necessary," he said.

"This does not mark the end of our increased oversight of Boeing and its suppliers, but it sets a new standard of how Boeing does business,” he added.