Airline Executives Call for Accountability as Boeing’s 737 Max 9 Challenges Continue
In recent weeks, airline executives have been expressing their frustration with Boeing’s ongoing challenges surrounding its 737 Max 9 jets. The incident in which a door plug flew off during an Alaska Airlines flight earlier this month has raised concerns about the company’s practices and operations, leading to a mandatory grounding of 171 aircraft. While United Airlines and Alaska Air are the only two US carriers directly impacted by the grounding, other airline CEOs have also voiced their criticism.
American Airlines CEO Robert Isom did not hold back when asked about Boeing’s leadership, stating, “We’re a huge Boeing customer… The issues that they’ve been dealing with over the recent period of time, but also going back a number of years now, is unacceptable.” This sentiment was echoed by Ben Minicucci, CEO of Alaska Air, who said, “As a longtime valued partner, we remain fully committed to our relationship with Boeing, but we also hold them accountable.”
The grounding of the 737 Max 9 fleet has had significant financial implications for Alaska Air, with an estimated hit of $150 million and daily flight cancellations ranging from 110 to 150 flights. Furthermore, executives anticipate delayed plane deliveries in 2024 and 2025. Alaska Air CFO Shane Tackett stated, “Our suspicion is many of those will get delayed, but we don’t know for how long.” United Airlines also expressed concerns about delayed deliveries and the certification of Boeing’s Max 10 aircraft.
Southwest Airlines, which expects 79 deliveries of 737 models this year, acknowledged uncertainty around timing and certification. However, Southwest Airlines CEO Bob Jordan expressed confidence in Boeing’s ability to address the quality issues and come out of this situation as a better company. Delta Air Lines CEO Ed Bastian also expressed faith in Boeing’s ability to restore confidence, despite not currently operating the Max aircraft.
The ongoing challenges faced by Boeing have led some on Wall Street to call for a shakeup in the company’s leadership. Mike Boyd, president of Boyd Group International, stated, “I’m just wondering whether they really need to take a bulldozer to the front office and rethink things.” Bank of America analyst Ron Epstein downgraded Boeing shares and emphasized that the issues at Boeing are the result of a cultural shift that cannot be changed overnight.
In response to the incident, Boeing named retired Admiral Kirkland Donald as an independent adviser to lead a “quality review” of the company’s commercial quality management system and practices. The FAA has also stated that the grounded 737 Max 9 planes will be eligible to return to service once they undergo individual inspections and maintenance checks.
The challenges faced by Boeing have taken a toll on the company’s market cap, which has shrunk by almost $30 billion since the mid-air incident. The stock is down about 20% year to date.
As the situation unfolds, it is clear that airline executives are demanding accountability from Boeing. The grounding of the 737 Max 9 fleet has not only impacted airlines financially but has also raised concerns about safety and quality standards. While some express confidence in Boeing’s ability to address these issues, others are calling for a reevaluation of the company’s leadership. Only time will tell how Boeing will navigate these challenges and regain the trust of its customers and stakeholders.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre.
Brad Smith is an anchor at Yahoo Finance. Follow him on Twitter at @thebradsmith.