As the dark clouds still hovering over the US aircraft manufacturer Boeing, the company is facing crisis upon crisis. Entering the most turbulent period in its history, with the 737 MAX experiencing two consecutive accidents within 5 months and the aircraft being grounded throughout the world for 20 months, Boeing has not managed to recover since then.
While the MAX crisis was still not over, manufacturing defects and flaws were detected one after another in the 787 Dreamliner aircraft. It has been announced that the target delivery date for the 777X delayed by at least five years (according to the initial schedule), after Boeing has failed to deliver 787s to customers for more than a year. Considering that all such crises were endured together with the negative effects of Covid-19, hitting hard the entire aviation sector, it would not be wrong to say that Boeing is extremely overwhelmed and exhausted.
"Boeing has lost its way. They need a fresh vision, strategy and maybe a new leadership!”, said Domhnal Slattery, CEO of Dublin-based Avolon, the world's second largest aircraft charter company, and it may be worth paying attention to.
O'Leary, CEO of Ryanair, one of Boeing's largest customers, well-known for his sharp tongue remarks, is not as polite as Slattery in this regard. O'Leary, who describes Boeing executives as “running around like headless chickens”, criticizes the company for having a very poor management performance.
No 777X Until 2025!
Earlier it was announced that the 777X, planned to be the new flagship in the wide-body aircraft market, would first come into service in 2020. It was then officially announced that the first delivery, postponed to 2021 and later to 2022, could not be made until 2025.
The Boeing 777X was envisioned as the latest version of the US manufacturer's most popular wide-body aircraft, the 777. Two different models, 777-8 and 777-9, were determined and designed to have both longer range and be larger than the existing 777s. Related actions were also taken even for the cargo version of the aircraft.
Considering that giant Jumbo jets such as the Airbus A380 and Boeing 747-8 do not have equivalents globally, the 777X is certainly to be the largest new aircraft to be manufactured over the next decade. Yet, the 777X's entry into service has been delayed multiple times for various reasons, from the Covid-19 pandemic to manufacturing and engine problems, and to certification issues.
777X - Reasons for Delay
The 777X, Boeing's latest twin-engine wide-body model, was first unveiled at the Dubai Airshow in 2013. The Boeing 777X, which should have completed its first test flight in mid-2019, was only able to take to the skies at the beginning of 2020. The reason for this delay was the recurring General Electric GE9X engine problems that would power the aircraft. These engines, caused delays in the certification process of the aircraft, were known as the world's largest and most powerful aircraft engine powering a commercial aircraft.
Yet it wasn't the only problem with the 777X. In 777X's certification process, during a pressure test applied to the aircraft, the cargo door could not endure the stress level and completely ruptured. This deepened the crisis since Boeing is under a much tighter certification process for the 777X by the FAA, after the tragic developments encountered in the 737 MAX aircraft.
The US Federal Aviation Administration FAA announced that the Boeing 777X would not be certified until mid-to-late 2023, due to incomplete data and preliminary safety checks.
One of the most solid justifications of the FAA's concerns was that the 777X experienced an "uncommanded pitching event" during a test flight in late 2020, meaning the nose of the aircraft pitched either up or down without pilot commands.
Back then, numerous e-mails were published showing that Boeing used a system “equivalent to” the Maneuvering Characteristics Augmentation System (MCAS) that caused the 737 MAX crisis also in the 777X. The US manufacturer flatly denied that the systems on the two aircraft were identical.
The FAA's report noted that the critical avionics system newly proposed to Boeing did not meet regulatory requirements and that modifications on the flight control system were worrisome. It was reported that the technical data required for type certification has not reached a point where it appears the aircraft type design is mature and can be expected to meet the applicable regulations. In short, the FAA told Boeing that the plane is not ready yet. Upon this development, Boeing has been suffering from tremendous loss of confidence. It seems the days of Boeing being able to tell the FAA “Just trust us” are long gone.
Airlines and Passengers Are Also Edgy!
Boeing' is now targeting the end of 2024 for certification of the 777X, with the first delivery expected in early 2025. Many airlines placing orders for the 777X are obviously dissatisfied with such problems and delays, as they rely on Boeing's delivery schedule for their fleet and network planning. The fact that the first delivery being delayed for five years and continuing to extend is not something ordinary for the airlines. Tim Clark, Chairman of Emirates, the launch customer of the aircraft, has been expressing his discomfort with such delays at every opportunity for a very long time.
Continuing delivery delays of the Boeing 777X are an issue affecting not only the airlines but also the passengers. As many airlines planned to start using the 777X as their new flagship in their fleet, they were planning in parallel to implement new cabin concepts on these aircraft.
Emirates will integrate the new first-class concept into 777X aircraft, currently available on a very limited number of 777-300ER aircraft. Cathay Pacific will introduce a completely new first and business class concept on the 777X. Singapore Airlines is expected to use new first-class cabin on the 777X. Lufthansa was poised to launch its new business class concept on the 777X, but now it is expected to launch on the 787 and A350 in 2023.
Dreamliner Crisis Also Deepening
Various problems discovered in the manufacturing process of the 787 aircraft have completely halted deliveries of the 787 for over a year. Following the announcements claiming that deliveries would resume in October 2021, then in early 2022, and finally in late April 2022, Boeing's latest statement is that deliveries will start in late 2022. But the FAA's concerns would probably lead to further delays in resuming deliveries.
Boeing was said to have submitted incomplete documentation to the Federal Aviation Administration to resume deliveries of its 787 Dreamliner aircraft. Even though Boeing states that the ongoing negotiations with the FAA are fully transparent, it is claimed that no progress is yet to be achieved as some of the requests from the FAA for resuming 787 deliveries have been overlooked. For the time being, Boeing 787 Dreamliner delivery resume date is still unclear.
Aircraft Stock Increases
After initially suspending deliveries in October 2020, deliveries could be resumed for a short while between April and June of 2021. Over a year of delay has had a severe impact on many airlines’ plans, creating a huge backlog for Boeing and having to cut production capacity to reduce the number of planes not delivered.
It is estimated that the pause of 787 deliveries for about a year has costed $5.5 billion to Boeing to date. Boeing's 787 jets are worth $12.5 billion, with 100 Dreamliners in inventory, being parked and undelivered to customers.
The FAA insists that the problems with the 787 are much deeper than a few simple manufacturing problems. In February, the FAA announced that it would not allow the plane maker to self-certify its new 787 jets and that a “systemic fix” to the company's manufacturing processes was needed. The FAA declared it will retain the authority to issue airworthiness certificates until it is confident “Boeing’s quality control and manufacturing processes consistently produce 787s that meet FAA design standards.”
To destock the undelivered 787 Dreamliner and 737 MAX in stock, to bear the burden of compensation, to overcome all the problems and bottlenecks related to the supply chain, to face up the difficulties arising from the war between Russia and Ukraine on regional and global aviation, to heal the wounds of the terrible economic crash caused by the pandemic, to overcome the global perception that Boeing aircraft are unsafe and to quell shareholders’ unease are just a few of the fighting fronts that the US plane maker has to struggle simultaneously. It seems challenging to win this battle with the current management mindset. Therefore, for my part, it is necessary to immediately start looking for a real commander, who can break the logjam that the company is in and return it to its former shining days. Or else, we may have to watch documentaries like Downfall on Netflix about Boeing!