Boeing in Crisis - What Went Wrong With It?

In today's skies, two giants rule the realm of aviation: Airbus and Boeing. If you've ever hopped aboard a commercial flight, chances are it was one of their planes. This is especially true for long-haul journeys, where Airbus and Boeing reign supreme, much like the timeless rivalry of "Coke vs. Pepsi" in the beverage world.

But amidst this aviation duopoly, Boeing, one of the big players, is facing some serious issues.

Let's turn back the clock to January of this year.

On January 5th, things got hairy mid-flight on an Alaska Airlines 737 Max 9. The plug door blew out, forcing the plane to make an emergency landing with a gaping hole in its side. Luckily, no one was hurt, but it could've been a catastrophe. Imagine: 171 passengers boarding an Alaska Airlines flight from Oregon to California at 5 pm on January 5th, only to find themselves in a terrifying ordeal just 10 minutes into the flight. The plane broke apart, wind howled, belongings were sucked out, and oxygen masks dropped as passengers held on for dear life. Thankfully, the pilots managed to land the plane safely, and everyone survived. But now, all eyes are on Boeing. Their 737 Max 9 planes are temporarily banned from taking off in the US, adding to a string of problems in recent years.

Fast forward to March 4th, and another Boeing 737 found itself in trouble, this time with an engine fire shortly after takeoff in Houston, Texas. It had swallowed some plastic bubble wrap left on the runway, according to United Airlines. Meanwhile, in Portland, Oregon, a Boeing 737-800 had to land urgently due to fumes in the cabin. And in yet another incident, a tire fell off a Boeing 777-200 after takeoff from San Francisco, causing chaos on the ground before the plane made a safe landing in Los Angeles. And if that weren't enough drama, a Boeing 737 MAX skidded off the runway in Houston, ending up stuck in the grass.

These incidents are alarming, but they're not isolated. Boeing's troubles began with the tragic crashes of the Boeing 737 MAX in 2018 and 2019, which claimed 346 lives combined. The planes were grounded worldwide for nearly two years, and even after they returned to service, more issues cropped up, from delivery delays to loose bolts and improperly drilled holes. These problems have tarnished Boeing's once-stellar reputation for safety and excellence.

Richard Aboulafia, the managing director of AeroDynamic Advisory in Washington, D.C., succinctly captures the shifting dynamics in the aviation industry, remarking, “What used to be a duopoly has become two-thirds Airbus, one-third Boeing.” Highlighting the perception divide between the two giants, he adds, “A lot of people, whether investors, financiers or customers, are looking at Airbus and seeing a company run by competent people. The contrast with Boeing is fairly profound.”

Reportedly Boeing’s board is also on the hunt for a new leader as CEO Dave Calhoun steps down amid turbulence within the company. With pressure mounting from airlines, regulators, and investors, Boeing announced a broader shakeup on Monday. The search for a replacement is underway, with many industry experts expecting Boeing to look outside the company for a fresh perspective.

Barry Valentine, a former senior official with the Federal Aviation Authority (FAA) said, “The three most important things in real estate are location, location and location. In air transportation it’s safety, safety and safety,”

“At the end of the day, if people don’t think you’re safe, they’re not going to get on. So there is an incentive to have a good safety record.”

So, What's Behind Boeing's Downfall?

Many say it's a shift in the company's culture. Once known for its engineering prowess and focus on innovation, Boeing's acquisition of McDonnell Douglas in 1997 changed things. Executives from McDonnell Douglas shifted the company's focus towards profits, overshadowing its commitment to quality.

This cultural shift led to a departure from engineering excellence, with profits taking priority over safety. The aftermath of the 737 MAX crashes exposed the consequences of this shift. Boeing's safety record is now in tatters, and regaining public trust won't be easy.

To reclaim its former glory, Boeing must return to its roots—an engineering-centric culture that prioritizes safety and quality. It's a tough road ahead, but it's crucial for Boeing's future. With Airbus on the rise and shareholder confidence dwindling, Boeing must learn from its mistakes and strive for excellence once again. In an industry where safety is paramount, there's no room for compromise.