Boeing In Crisis: Is This The End?


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Boeing is not in a great place right now. Garuda has just cancelled 49 B737 MAX planes and is trying to return the one they have, as they believe their passengers don’t have confidence in the plane. According to intelligencer, this order was worth $6 USD Billion. Lion Air reportedly switched a $22 billion USD, 200-plane order to rival Airbus after the crash in October. If other airlines follow suit, the domino effect could be a disaster for the company.

This week, it was reported that neither the Lion Air nor the Ethiopian Airlines plane had two optional safety features that would have given the pilots visual cues regarding the sensor related to the crash. The Times reported that Boeing will start providing these features as standard equipment, but these safety features were previously “optional”.

As a passenger, I would agree with Garuda. I don’t really want to get on a plane unless all possible safety features are included and, yes, I have lost confidence in the B737 MAX. I feel uneasy that Boeing thought it was OK to sell planes without this safety feature. I am no aviation expert, but the result of excluding this feature seems clear.

It has also been reported that a selling point of these new 737 planes was that pilots would require less hours to re-training and fly the upgraded plane, when compared to other new planes, thus saving time and money for the airlines. The result was that some pilots did not have the training to understand how MCAS worked. Again, not something that inspires me with confidence.

Boeing is surviving, but there will undoubtedly be some very rocky months to come for the manufacturer. We do know that Boeing has lost $40 billion USD plus in market value since the second crash. Not chump change.

This is not the end of Boeing, but we watch and wait to see what happens next. It would be a braver person than me who chooses to board a Boeing 737 MAX in the near future, and I am not alone. If airlines continue to respond to passenger fear by cancelling their orders, the $40 billion USD loss in market value may just be the tip of the iceberg.

In the meantime Bloomberg outlines where the grounded American B737’s have gone.

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