Issues identified: The Boeing factory in North Charleston, South Carolina. The FAA has pinpointed Boeing’s past problem of focusing on output over quality and is seeking to overhaul the company’s culture. — Reuters
HELP wanted: A dynamic, self-motivated aerospace executive with experience in lean, high-quality manufacturing and proven leadership skills at turning around flailing operations at a company with a market value of more than US$100bil and 170,000 workers.
Candidate needs to relocate to Seattle and be impervious to constant attacks under an intense media spotlight. As part of an 80-hour workweek, the applicant must handle contentious congressional hearings, calm angry airline customers and tame an unwieldy supply chain.
The candidate will also contend with whistleblowers, potential federal criminal charges and the likelihood of a crippling strike in September by more than 32,000 machinists at its main factories.
Any takers? So far, Boeing Co hasn’t been able to find many interested in the job.
Larry Culp, the turnaround artist who now heads GE Aerospace, already said no, according to the Wall Street Journal. David Gitlin, the chief executive officer of Carrier Global Corp and a Boeing board member, also declined.
It’s little wonder that strong candidates are unwilling to stick out their necks to save Boeing.
Chief executive officer David Calhoun, who agreed to step down by the end of the year, apologised for the umpteenth time for Boeing’s failings on Tuesday as he faced a grilling from senators who decided to re-cover well-tread ground about the manufacturing deficiencies brought to light after a door plug flew off a passenger jet in midflight in January.
The senators wheeled out another whistleblower ahead of a hearing by the Senate Permanent Subcommittee on Investigations, and Democratic Senator Richard Blumenthal of Connecticut went as far as to say during the hearing that it’s likely that Boeing violated a 2021 deferred prosecution agreement, adding “there’s near overwhelming evidence, in my view as a former prosecutor, that prosecution should be pursued.”
To show that grandstanding on Boeing is a bipartisan effort, Republican Senator Josh Hawley of Missouri had some pointed words for Calhoun.
“Behind you, the folks are showing pictures of the people who are the victims of your safety record,” he said during the hearing. “I think we can all see them. And I think the American public when they fear to get on the airplanes, they understand your safety record. Frankly, sir, I think it’s a travesty that you’re still on your job.”
None of this public circus helps Boeing, the sole US producer of commercial airliners. What does help Boeing is the plan by the Federal Aviation Administration (FAA) to have more inspectors at the company’s factories labouring behind the scenes to scrutinise every aspect of Boeing’s manufacturing process, including looking at suppliers.
The FAA has already pinpointed Boeing’s past problem of focusing on output over quality and is seeking to overhaul the company’s culture. “It’s a multi-year journey to change that culture,” FAA administrator Michael Whitaker said at a Politico summit earlier this month.
From the tone coming from members of the subcommittee, one would think it takes only a snap of the fingers to right the ship, and for some inexplicable reason Calhoun and Boeing’s management are simply unwilling to start snapping.
Blumenthal seems to believe that what will speed things along is for the Justice Department to reopen a criminal investigation into two fatal accidents more than five years ago that were clearly tragic and resulted from employee subterfuge on a software fix, and then lumping in the unrelated January accident in which the bolts were left off of a door plug, which was more about negligence.
More senators want to get in on the action. Chuck Grassley said last week that he’s starting a congressional probe into Boeing and the FAA.
Neither the Justice Department nor the nine members of the Senate subcommittee are going to help Boeing navigate this rough patch. It should be clear to everyone that the company needs a hand to get back on its feet and not a gratuitous kicking while it’s down.
Boeing is not only too big to fail, it’s too important to fail. Besides being an iconic American manufacturer, the global aviation industry depends on a thriving competitor to Europe’s Airbus SE, the only other maker of the large commercial airliners.
After the United States has ceded large swaths of our manufacturing base to China, it would be a national tragedy to allow the assembly of commercial aircraft to migrate to China.
It shouldn’t be easy anymore to scoff at the Chinese made C919, the new narrow-body airliner that is now flying passengers in China. This is only the start of China’s quest to insert itself as a rival supplier of commercial aircraft, and it’s clear from recent history that its government is willing to play the long game to win.
Just look at how the world’s shipbuilding capacity shifted over decades until China is now the world’s largest builder of commercial and military ships.
The Senate has already done its job by approving the FAA Reauthorisation Act of 2024, which gives the federal agency a five-year budget to hire the inspectors to be on Boeing’s factory floors. That’s happening now.
As FAA Administrator Whitaker has explained, it will take years to change the culture at Boeing. Putting Boeing under the klieg lights and threatening it with prosecution won’t accelerate this process.
Perhaps as the spotlight dims, Boeing will be able to hire that perfect chief executive officer to guide the company back to the basics of making great airplanes. — Bloomberg
Thomas Black is a Bloomberg Opinion columnist writing about the industrial and transportation sectors. The views expressed here are the writer’s own.
