Why The Boeing 737 Max Has Been Such A Mess
CNBC・2 minutes read
Two Boeing 737 Max crashes resulted in the deaths of 346 people, leading to scrutiny of Boeing's manufacturing processes and management changes. The company faces stock declines and criticism from major customers like United Airlines and Southwest Airlines, with experts predicting a lengthy process for Boeing to restore its safety reputation.
Insights
- Boeing has faced severe consequences, including crashes, injuries, and stock decline, due to quality control problems and management issues, necessitating significant changes in leadership to address these critical issues.
- The company's reputation for safety has been significantly tarnished, requiring a prolonged period of rebuilding trust, even with changes in management, indicating a challenging road ahead for Boeing to prioritize safety over profit concerns and regain the confidence of major customers and the public.
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What caused the Boeing 737 Max crashes?
MCAS system malfunctions led to fatal crashes.
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Summary
00:00
Boeing's Troubles: Crashes, Stock Decline, Management Changes
- 346 people died in two plane crashes involving Boeing 737 Max planes in Indonesia and Ethiopia five years ago.
- Boeing faced another potential catastrophe when a door plug blew off an Alaska Airlines 737 Max nine shortly after takeoff from Portland, Oregon in January.
- The incident resulted in a child being sucked out of the plane, but fortunately, no serious injuries occurred.
- The Federal Aviation Administration found numerous problems in Boeing's manufacturing process after auditing it.
- Boeing announced major management changes, with CEO Dave Calhoun stepping down at the end of 2024.
- Boeing's stock has declined over 25% in 2024 due to various issues, including the Max crashes and pandemic-related impacts.
- Boeing's best-selling jet, the 737, has a long history dating back to 1967 and has seen many evolutions over the years.
- Boeing faced pressure from Airbus after the latter launched the A320neo, prompting Boeing to re-engine the 737 into the 737 Max.
- The 737 Max faced issues with the Maneuvering Characteristics Augmentation System (MCAS), leading to fatal crashes in Indonesia and Ethiopia.
- Boeing has been under scrutiny for quality control problems, with issues ranging from missing bolts to misdrilled holes in the fuselage.
12:29
Boeing Faces Criticism, Makes Management Changes
- Boeing, a crucial company in the United States, is facing criticism from major customers like United Airlines and Southwest Airlines due to delays in delivering planes. Southwest's CEO has even called for Boeing to improve as a company.
- In response to the challenges, Boeing has made significant management changes, replacing the CEO of its commercial airplane business and initiating a search for a new CEO. Despite these changes, experts predict a lengthy process for Boeing to restore its safety reputation over profit concerns, possibly taking a couple of years.
