Boeing, this week, reached an unprecedented low: It sunk even deeper into turmoil.
Adding to what has been a dismal start to 2024, Boeing faced accusations on Tuesday of consistently disregarding a whistleblower’s concerns regarding the purportedly critically flawed manufacturing process for its 787 Dreamliner aircraft. The whistleblower alleged that Boeing retaliated against him, assigning him to the 777 unit as punishment. It was there, he claimed, that he unearthed further production issues.
Boeing vehemently refuted these allegations, asserting its confidence in the safety of its planes. Nevertheless, the US Federal Aviation Administration (FAA) announced an investigation, joining a growing list of federal inquiries into the beleaguered company, including a criminal investigation. Additionally, a Senate subcommittee is scheduled to hear testimony regarding the whistleblower’s case next week, likely leading to more public scrutiny of Boeing’s practices.
These fresh allegations of lax safety standards compound the company’s existing challenges and tarnish its already damaged public image. Boeing, once renowned for safety, now finds itself led by highly paid executives accused of neglecting quality standards.
Yet, the woes for Boeing seem unending.
The Whistleblower’s Claims
The whistleblower, Sam Salehpour, a Boeing engineer, alleged that Boeing took shortcuts in manufacturing its 777 and 787 Dreamliner jets, skipping essential safety steps. These shortcuts could potentially result in catastrophic failures as the planes age, significantly shortening their expected lifespan of up to 50 years. Salehpour’s claims, initially reported by The New York Times, were formalized in a complaint to the FAA in January and made public this week. While not entirely new — the FAA had previously investigated Boeing over 787 production concerns — Salehpour’s complaint shed light on overlooked issues during the assembly of the 787 Dreamliner fuselage, potentially compromising the planes’ structural integrity.
Boeing insists that the 787 is safe to fly, and after halting deliveries, the FAA thoroughly reviewed and approved Boeing’s manufacturing processes. The company dismissed Salehpour’s allegations, stating they do not accurately represent its efforts to ensure aircraft quality and safety.
Salehpour further claimed that in his new role with the 777 unit, he discovered substandard workmanship, with crews failing to align body pieces properly, all while Boeing allegedly pressured engineers to approve uninspected work.
Boeing refuted these claims, expressing full confidence in the safety and durability of the 777 family.
How Boeing Got Here
These latest accusations exacerbate an already dire situation for Boeing.
Critics argue that the company’s once-pristine safety record was tarnished following its contentious 1997 merger with McDonnell Douglas. This marked the beginning of a downward spiral, culminating in the tragic crashes of the 737 Max in 2018 and 2019. Boeing admitted liability for these crashes, attributing them to a design flaw that has since been rectified following a nearly two-year grounding.
The spate of bad news began in late 2023 when an airline identified a potential issue with a critical component on two 737 Max aircraft. Then, in early 2024, part of an Alaska Airlines 737 Max detached shortly after takeoff, triggering a crisis for Boeing. A preliminary investigation suggested Boeing may have overlooked the installation of bolts designed to secure the part, leading to its detachment. Although Boeing has not directly addressed the findings, CEO Dave Calhoun acknowledged the company’s mistake and committed to addressing the issue.
This incident prompted a temporary nationwide grounding of certain 737 Max jets, congressional hearings, production delays, federal investigations — including a criminal probe — and a significant drop in Boeing’s stock value, erasing nearly $50 billion from its market capitalization.
The bad news continued to mount. In February, pilots reported flight control issues with a United Airlines 737 Max during landing in Newark, New Jersey. Last month, the FAA raised concerns about de-icing equipment on 737 Max and 787 Dreamliner models, potentially affecting engine thrust. While the FAA allowed these planes to continue flying, it highlighted deficiencies in Boeing’s manufacturing and assembly processes, giving the company until May to address them.
Boeing is actively working to resolve these issues identified by the FAA.
What Lies Ahead for Boeing
The fallout from these challenges has extended to Boeing’s top leadership, with several executives, including those overseeing commercial jets and the 737 Max unit, departing. CEO Dave Calhoun announced plans to step down before the year’s end, amidst mounting pressure.
Boeing’s recent setbacks will come at a significant cost. Airlines have largely halted orders, and those placed for the 737 Max 10, Boeing’s larger variant, are contingent on resolving the de-icing issue. The company faces potential fines and lawsuits, having already compensated Alaska Airlines for losses incurred during the temporary grounding.
With no profits in recent years and ongoing challenges, Boeing’s path to recovery is uncertain. While it retains its position as a major player in the commercial aircraft market, the company’s reputation and relationships with regulators and customers are strained. Restoring trust and addressing systemic issues will require concerted efforts from Boeing’s incoming leadership, under the scrutiny of stakeholders worldwide.
