
<h2 class="wp-block-heading" id="h-topline">Topline</h2>



<p>A DHL cargo plane crashed near the Vilnius Airport in Lithuania’s capital city on Monday, killing at least one person and injuring two others, although the cause of the accident remains unknown.</p>


<div class="wp-block-image">
<figure class="aligncenter size-full is-resized"><img loading="lazy" decoding="async" width="1024" height="694" src="https://cms.forbesafrica.com/wp-content/uploads/2024/11/GettyImages-2185884823.jpg" alt="" class="wp-image-63772" style="width:810px;height:auto" srcset="https://cms.forbesafrica.com/wp-content/uploads/2024/11/GettyImages-2185884823.jpg 1024w, https://cms.forbesafrica.com/wp-content/uploads/2024/11/GettyImages-2185884823-300x203.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2024/11/GettyImages-2185884823-768x521.jpg 768w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption class="wp-element-caption"><strong><em>&#8220;Cargo plane crashes near Vilnius airport&#8221; (Photo by Elif Acar/Anadolu via Getty Images)</em></strong></figcaption></figure></div>


<h2 class="wp-block-heading" id="h-key-facts">Key Facts</h2>



<p><a href="https://www.lrt.lt/naujienos/lietuvoje/2/2422029/lektuvo-katastrofa-vilniuje-zuvo-ispanijos-pilietis-trys-suzeisti-vienas-ju-lietuvis" rel="noreferrer noopener" target="_blank">According to</a>&nbsp;Lithuanian state broadcaster LRT, one crew member was killed in the crash, while three others were injured—including one who is in critical condition.</p>



<p>The plane crashed into a residential building near the airport, although none of its&nbsp;<a href="https://www.lrt.lt/naujienos/lietuvoje/2/2422145/apie-lektuvo-avarija-vilniuje-is-pirmu-lupu-eikit-kur-nors-nes-tuoj-viskas-sprogs" rel="noreferrer noopener" target="_blank">12 residents</a>&nbsp;were injured in the crash, police said.</p>



<p>DHL Flight 18D, operated by Spanish carrier Swiftair, was flying from Leipzig to Vilnius, and the plane appeared to have been attempting a landing when the crash took place,&nbsp;<a href="https://www.flightradar24.com/data/aircraft/ec-mfe#381bbfbf" rel="noreferrer noopener" target="_blank">tracking data</a>&nbsp;on FlightRadar 24 showed.</p>



<p>Local investigators have not yet been able to determine the cause of the crash.</p>



<p>Swiftair&nbsp;<a href="https://www.swiftair.com/" rel="noreferrer noopener" target="_blank">confirmed</a>&nbsp;the plane involved in the accident was an older Boeing 737-400, and four people were onboard.</p>



<p><em>This is a developing story.</em></p>


Cargo plane crashes into Lithuanian home, killing one and injuring two

DHL Cargo Plane Crashes In Lithuania—At Least One Dead And Three Injured


<h2 class="wp-block-heading" id="h-topline">TOPLINE</h2>



<p>Boeing has agreed to plead guilty to a fraud conspiracy charge in a deal with the Justice Department to avoid facing trial in a federal criminal case linked to deadly crashes involving two 737 Max planes that killed 346 people in 2018 and 2019.</p>



<h2 class="wp-block-heading" id="h-key-facts">KEY FACTS</h2>



<p>In a&nbsp;<a href="https://storage.courtlistener.com/recap/gov.uscourts.txnd.342881/gov.uscourts.txnd.342881.204.0_2.pdf" rel="noreferrer noopener" target="_blank">court filing</a>&nbsp;late on Sunday, the Justice Department said Boeing will plead guilty to the felony charge of “conspiracy to defraud the United States, specifically, the lawful function of the Federal Aviation Administration Aircraft Evaluation Group.”</p>



<p>As part of the deal, Boeing agreed to pay an additional fine of $243.6 million—the same penalty the company had paid as part of a settlement in 2021 that it was later&nbsp;<a href="https://apnews.com/article/boeing-justice-department-737-max-82145b25ed988cd8cae0bce3de79ce9d" rel="noreferrer noopener" target="_blank">accused of violating</a>.</p>



<p>The filing notes that Boeing&#8217;s total fine of $487.2 million is the maximum allowed under law for the charged offenses.</p>



<p>The plane maker will also be required to invest approximately $455 million over the next three years to improve its compliance and safety programs.</p>



<p>The deal will have to be approved by a federal judge to take effect.</p>



<h2 class="wp-block-heading" id="h-what-to-watch-for">WHAT TO WATCH FOR</h2>



<p>The plea deal only covers Boeing&#8217;s actions in the lead-up to the fatal crashes of two 737 Max planes in 2018 and 2019. It does not offer the company immunity in any other incidents—including one in January in which a door plug blew off an Alaskan Airlines flight minutes after take off. Boeing still faces a&nbsp;<a href="https://apnews.com/article/boeing-ntsb-door-plug-emergency-landing-2d23408a25eff999579c88071836dbec" rel="noreferrer noopener" target="_blank">separate criminal probe</a>&nbsp;over the incident.</p>



<h2 class="wp-block-heading" id="h-key-background">KEY BACKGROUND</h2>



<p>In October 2018, a Boeing 737 Max, operated by Indonesian low-cost carrier Lion Air, crashed into the Java Sea minutes after take off, killing all 189 passengers and crew onboard. In March 2019, a similar crash of an Ethiopian Airlines 737 Max resulted in the death of all 157 people on board. The crashes caused civil aviation authorities around the world to ground all variants of the 737 Max. In 2021, Boeing&nbsp;<a href="https://apnews.com/article/business-indonesia-61b2ccb06d4eebb2d4091c6d90147f72" rel="noreferrer noopener" target="_blank">agreed to</a>&nbsp;a $2.5 billion settlement to avoid criminal charges and admitted to misleading investigators about the safety of the planes. The settlement included a fine of $243.6 million, $1.77 billion in payment to airlines affected by the 737 Max’s grounding, and $500 million to families of the passengers killed in the two crashes. In May this year, the DOJ&nbsp;<a href="https://apnews.com/article/boeing-justice-department-737-max-82145b25ed988cd8cae0bce3de79ce9d" rel="noreferrer noopener" target="_blank">accused</a>&nbsp;Boeing of violating the settlement.</p>



<h2 class="wp-block-heading" id="h-section-title">SECTION TITLE</h2>



<p><a href="https://www.forbes.com/sites/maryroeloffs/2024/06/30/justice-department-planning-fraud-charge-against-boeing/">Justice Department Planning Fraud Charge Against Boeing</a>&nbsp;(Forbes)</p>



<p><a href="https://www.forbes.com/sites/siladityaray/2024/07/01/boeing-announces-47-billion-deal-to-acquire-supplier-spirit-aerosystems/">Boeing Buying Embattled 737 Supplier Spirit AeroSystems For $4.7 Billion</a>&nbsp;(Forbes)</p>


US-AVIATION-BOEING

Boeing Will Plead Guilty To Fraud Charge—Avoiding Trial Over 737 Max Crashes


<h2 class="wp-block-heading" id="h-topline">TOPLINE</h2>



<p>Boeing is expected to avoid criminal prosecution after the Justice Department recently found it&nbsp;<a href="https://www.forbes.com/sites/antoniopequenoiv/2024/05/14/boeing-violated-agreement-protecting-it-from-criminal-charges-over-737-max-crashes-justice-department-says/">violated a $2.5 billion settlement</a>&nbsp;shielding it from charges over two 737 Max 8 model crashes in 2018 and 2019 that killed a total of 346 people, according to&nbsp;<a href="https://www.nytimes.com/2024/06/21/us/politics/boeing-doj-deferred-prosecution-agreement.html?smtyp=cur&amp;smid=tw-nytimes" rel="noreferrer noopener" target="_blank">The New York Times</a>, which reported that department officials have deemed prosecution of Boeing “too legally risky.”</p>



<h2 class="wp-block-heading" id="h-key-facts">KEY FACTS</h2>



<p>Instead of criminally prosecuting Boeing, the Justice Department plans to offer the aerospace company a deferred prosecution agreement requiring it to install an independent government watchdog tasked with keeping track of safety and quality control, the Times reported, citing two anonymous sources.</p>



<p>The Justice Department was able to seek prosecution of Boeing, which was charged with&nbsp;<a href="https://www.justice.gov/opa/pr/boeing-charged-737-max-fraud-conspiracy-and-agrees-pay-over-25-billion" rel="noreferrer noopener" target="_blank">conspiracy to defraud the U.S.</a>, in May after federal officials said the company&nbsp;<a href="https://www.forbes.com/sites/antoniopequenoiv/2024/05/14/boeing-violated-agreement-protecting-it-from-criminal-charges-over-737-max-crashes-justice-department-says/">violated its 2021 prosecution agreement</a>&nbsp;by “failing to design, implement and enforce a compliance and ethics program” made to detect and stop potential fraud violations.</p>



<p>The installation of a federal monitor to supervise safety improvements at Boeing is seen by officials as a more efficient way to get the company to fall in line with safety and quality control improvements, according to the Times.</p>



<p>The new settlement offer is expected to be given to Boeing within the month, though terms of the deal could still change, the Times noted.</p>



<p>Boeing and the Justice Department did not immediately respond to Forbes’ request for comment.</p>



<h2 class="wp-block-heading" id="h-big-number">BIG NUMBER</h2>



<p>$2.5 billion. That is the whopping figure Boeing agreed to pay in the settlement, which included $1.77 billion in compensation to be paid out to Boeing 737 Max airline customers, a $500 million crash-victim beneficiary fund and a criminal penalty totaling $243.6 million.</p>



<h2 class="wp-block-heading" id="h-key-background">KEY BACKGROUND</h2>



<p>Boeing’s 2021 settlement was reached after the company was accused of conspiracy to defraud the FAA’s aircraft evaluation arm in connection with the agency’s probe into the 737 Max airplane. Boeing&nbsp;<a href="https://www.justice.gov/opa/pr/boeing-charged-737-max-fraud-conspiracy-and-agrees-pay-over-25-billion" rel="noreferrer noopener" target="_blank">admitted in court documents</a>&nbsp;it misled the FAA about a part known as the Maneuvering Characteristics Augmentation System, which automatically pushes down the nose of the aircraft when it detects too high of a pitch. Boeing’s cover-up led to pilots flying the 737 MAX for Boeing’s airline customers without being provided information on the system in manuals or training materials. The FAA concluded the system may have played a role in the 2018 and 2019 crashes that occurred near Indonesia and Ethiopia. The 2018 Indonesia crash killed all 189 passengers and crew on board while the 2019 crash killed 157.</p>



<h2 class="wp-block-heading" id="h-further-reading">FURTHER READING</h2>



<p><a href="https://www.forbes.com/sites/antoniopequenoiv/2024/05/14/boeing-violated-agreement-protecting-it-from-criminal-charges-over-737-max-crashes-justice-department-says/">Boeing Violated Agreement Protecting It From Criminal Charges Over 737 Max Crashes, Justice Department Says&nbsp;</a>(Forbes)</p>



<p><a href="https://www.nytimes.com/2024/06/21/us/politics/boeing-doj-deferred-prosecution-agreement.html?smtyp=cur&amp;smid=tw-nytimes" rel="noreferrer noopener" target="_blank">Boeing Is Expected to Evade Criminal Charges for Violating Settlement</a>&nbsp;(New York Times)</p>


British Airways Retires First Of Its Last 747 Jumbo Jets

Boeing Will Likely Avoid Criminal Charges After Violating $2.5 Billion Settlement Linked To Fatal Crashes, Report Says


<p><strong>It’s not enough for Boeing to fix the 737 Max program. To remain competitive against Airbus, the planemaker needs to make a big bet on a new jet.</strong></p>



<hr class="wp-block-separator has-alpha-channel-opacity"/>



<p>To Boeing’s<a href="https://www.forbes.com/companies/boeing" target="_blank" rel="noreferrer noopener">Boeing</a> <a href="https://www.forbes.com/companies/boeing">0.0%</a> long list of urgent near-term problems, add one more. It needs a new airplane.</p>



<p>With its best-selling plane, the 737 Max, the subject of public and federal scrutiny after the&nbsp;<a href="https://www.forbes.com/sites/jeremybogaisky/2024/01/09/a-blowout-on-an-alaska-plane-is-the-least-of-boeings-problems/">terrifying midair blowout</a>&nbsp;of a panel on an Alaska Airlines jet in January, the world&#8217;s largest aerospace company is struggling to recover from a nightmare that’s slashed $28 billion from its market cap. And its two decades of procrastinating the launch of another new plane program since development of the 787 formally kicked off in 2003 is increasingly looking costly. Analysts told&nbsp;<em>Forbes</em>&nbsp;the clock is ticking for Boeing to come up with a new narrowbody plane to stem a steep loss in market share to rival Airbus.</p>



<p>In November 2022, CEO David Calhoun ruled out introducing a new plane until the mid-2030s, saying the technology for a step change in fuel efficiency wouldn’t be ready till then. Critics said it was a risk-averse move that would allow Boeing to save billions in the short-term and boost investors’ returns while sabotaging its future. But Boeing is now in the midst of&nbsp;<a href="https://www.forbes.com/sites/jeremybogaisky/2024/03/25/boeing-next-ceo-who-could-succeed-calhoun/?sh=8173af574414">a management shakeup</a>, with a new board chairman who’s aiming to hire a replacement for Calhoun before year-end. Analysts expect the next CEO to take a fresh look at developing a new airplane.</p>



<p>Airbus’ A320neo family has outsold the 737 Max line nearly 2 to 1, largely on the strength of the largest planes, the A321 and A321XLR. They can carry more passengers farther than the 737 Max 10, the biggest Max variant, which Boeing has yet to bring to market. Meanwhile, Airbus has a newer, more efficient small airliner, the A220, that it’s considering stretching into a larger version that would threaten the lower end of the 737 line.</p>



<p>“Boeing&#8217;s in the middle” between the A321 and A220 “with an aircraft that&#8217;s had trouble — not a great place to be,” Robert Spingarn, an analyst at Melius Research, told&nbsp;<em>Forbes</em>. “You&#8217;re getting to the point where your competitive edge is at risk.”</p>



<p>With everything that will be on the new CEO’s plate – including what promise to be difficult contract talks with Boeing’s machinists in Washington state – there’s a risk that person won’t want to touch a new airplane till the near-term problems are solved. That would be a mistake, said Spingarn.</p>



<p>“They should be able to do both of these things simultaneously, get the safety and quality back to where it needs to be, and at the same time figure out what the future is going to hold.”</p>



<p>However, analysts warn that if Boeing moves too soon, Airbus could trump it a year or two later with a plane tailored to beat it, as well as miss out on new technologies under development that promise to lower carbon emissions.</p>



<p>Failing to roll out a new plane before 2035 means Boeing’s share of the narrowbody market could slide under 40%, Ron Epstein of Bank of America has estimated.</p>



<p>That’s a sharp change from the previous generation of both planes, where Boeing had a roughly 52% market share – and commanded higher prices to boot, said Nick Cunningham, an analyst with equity research firm Agency Partners.</p>



<p>Boeing’s market share losses could be hard to reverse given the stickiness of incumbency with airlines, which are reluctant to switch plane types due to the high expense of retraining pilots to fly them, said Ken Herbert, an analyst at RBC Capital Markets.</p>



<p>“Calhoun &#8230; says that it&#8217;s too expensive and too risky and has given all sorts of reasons why they shouldn&#8217;t do it,” said Cunningham. “The problem is if they don&#8217;t do it, then that&#8217;s effectively a counsel of despair. It means that you&#8217;ve accepted that you are now only about a third of the narrowbody market as opposed to half the narrowbody market. And it runs a risk that you end up becoming McDonnell Douglas.” That once-proud American planemaker lost market share for decades as it limited investment to updating older models, and was bought by Boeing in 1997.</p>



<p>Right now, even if management wanted to launch a new plane program, Boeing likely couldn’t afford to, with a cash outflow of $3.9 billion in the first quarter and expectations the bleeding will continue in the second quarter, with 737 assembly rates slowed while the company works through improvements to the manufacturing process. After that, Boeing hopes to unlock a torrent of cash by delivering by the end of the year most of the 170 Max 8s and 60 787s it had piled up in inventory as of March 31. Airlines typically pay 65% to 70% of the purchase price of a plane on delivery. It also aims to raise 737 production to 38 per month in the second half and with a goal of 50 by 2026. But many analysts are skeptical it will come off as promised. “If there has been one thing that has been consistent about Boeing over our many years of covering the company it has been its hopelessly optimistic timetables for improvement,” Robert Stallard of Vertical Research wrote in a note. For example, Boeing had planned at the beginning of 2022 to deliver 500 737s that year. It managed 386.</p>



<h2 class="wp-block-heading" id="h-plane-in-vain">Plane In Vain</h2>



<p>Boeing has prevaricated for two decades on launching a program to replace the 737, an aircraft design that dates back to the 1960s, or to build a plane sized between the 737 and its 787 widebody.</p>



<p>In the early 2000s, a project called Yellowstone sketched out plans for a new narrowbody in tandem with designs that became the 787. The narrowbody would have used many of the same technologies, including a carbon fiber composite body. Boeing executives tentatively discussed bringing it to market<a href="https://www.wsj.com/articles/SB10001424052748703293204576105722792053588" rel="noreferrer noopener" target="_blank">&nbsp;in 2020</a>, but those plans were up-ended in 2011 when American Airlines warned it was considering buying hundreds of an updated A320 with more efficient engines. To prevent American and other customers from defecting to Airbus, Boeing shelved the new plane and took the quicker, cheaper route of re-engining the 737, too.</p>



<p>The difficulties of placing a larger engine on a plane originally designed to be<a href="https://www.forbes.com/sites/jeremybogaisky/2019/03/15/should-boeing-have-replaced-the-737-instead-of-re-engining-it/?sh=1efd59e91061">&nbsp;low to the ground to allow boarding by ladder</a>&nbsp;led to the need for stability augmentation software that malfunctioned in two deadly crashes in 2018 and 2019, throwing the company into crisis.</p>



<p>From 2015 to 2020, Boeing also went back and forth on building a larger jet aimed at replacing the 757 and 767. When Calhoun was made CEO at the beginning of 2020, he sent designers back to the drawing board, saying the playing field had shifted. By 2021, there were reportedly plans for a smaller version to compete with the A321neo.</p>



<p>Calhoun’s decision to punt on a new plane till the 2030s would give Boeing time to stabilize operations, including integrating its 737 fuselage supplier, Spirit AeroSystems<a href="https://www.forbes.com/companies/spirit-aerosystems" target="_blank" rel="noreferrer noopener">Spirit AeroSystems</a>&nbsp;<a href="https://www.forbes.com/companies/spirit-aerosystems">0.0%</a>, which it’s in negotiations to acquire, and harvest cash from its current lineup. That includes raising production rates and bringing to market three long-delayed variants of existing planes — the Max 7, Max 10 and 777X. The company projects that will allow it to raise free cash flow to $10 billion annually by 2026, helping it pay down its net debt of roughly $40 billion – up from about $13 billion at the end of 2019.</p>



<p>But Cunningham thinks Boeing has quietly given itself financial headroom to invest in a new jet through the structuring of $10 billion in debt that the company raised in late April to bolster its depleted cash reserves. Despite high interest rates averaging 6.6%, Boeing has pushed out repayment for a strangely long time, he notes: about 65% of it matures from 2034 to 2064. Cunningham thinks that’s a sign the company plans to direct free cash flow to R&amp;D. “They can build up a cash position which would enable them to develop a new airplane,” he said.</p>



<p>Boeing declined to respond to questions on the company’s plans, but referred&nbsp;<em>Forbes</em>&nbsp;to Calhoun’s statement Friday at the annual shareholders meeting that investments in its factories and R&amp;D would increase in 2024 from nearly $5 billion the year before. “Our mission is to mature the essential technologies that will enable safe and sustainable flight in the years ahead,” he said.</p>



<p>Analysts expect a new plane could cost $20 billion to $30 billion in R&amp;D and capital expenditures over eight to 10 years. If Airbus stretches the A220, Boeing might need to counter with a second, smaller plane as well, some analysts think.</p>



<p>A problem Boeing faces is that with Airbus in a stronger position, the European company could wait for Boeing to show its hand and then counter with something designed to top Boeing’s plane.</p>



<p>“The one thing they don&#8217;t want to do is go too soon and limit themselves to a certain kind of technology … and then discover that Airbus comes out with something that&#8217;s a much bigger evolutionary or revolutionary change in technology two years later,” said Spingarn. “That is largely unrecoverable and both of them are nervous about this.”</p>



<p>But Airbus may be forced to move faster than it would like due to greater pressure in Europe to reduce aviation’s carbon emissions, said Herbert.</p>



<p>It’s pledged to introduce a small, zero-emission aircraft powered by hydrogen in 2035.</p>



<p>It’s unclear what a new Boeing plane could look like, but one potential element it’s experimenting on with NASA is a long, thin wing mounted high on the fuselage that would be braced with diagonal struts. The lighter, more efficient wings could enable a 10% reduction in fuel burn, according to NASA. With $425 million in NASA funding, Boeing is working to mount prototypes of the truss-braced wings on an MD-90 jet for flight-testing that is scheduled to begin in 2028.</p>



<p>To future-proof its next plane, Boeing could develop an airframe with a conventional propulsion system to start but with the capacity to be upgraded to run on hydrogen or hybrid electric power, said Spingarn. The truss-braced wing would have plenty of room to accommodate a large open-rotor engine under development by General Electric<a href="https://www.forbes.com/companies/general-electric" target="_blank" rel="noreferrer noopener">General Electric</a>&nbsp;<a href="https://www.forbes.com/companies/general-electric">0.0%</a>&nbsp;and Safran dubbed Rise that could reduce fuel use and carbon emissions by 20%.</p>



<p>Boeing will likely approach airlines with two designs – a conservative one and a more radical one – and gauge interest before choosing which to go forward with.</p>



<p>With uncertainty about technology readiness and how Airbus could respond, Boeing faces tough decisions, but it has to embrace risks to get back on top, said Cunningham.</p>



<p>“It got to be the great company it was by having very bold, very competent management taking big decisions. And they unavoidably have to get back to that.”</p>


Etihad Boeing 777 with contrails on blue

Why Boeing Needs A New Plane — Soon


<h2 class="wp-block-heading" id="h-topline">TOPLINE</h2>



<p>The Federal Aviation Administration&nbsp;<a href="https://www.faa.gov/newsroom/faa-halts-boeing-max-production-expansion-improve-quality-control-also-lays-out-extensive" target="_blank" rel="noreferrer noopener">announced</a>&nbsp;Wednesday a pathway toward resumed flights for Boeing 737 Max 9 jets, but it won’t allow Boeing to expand production of the planes after a hole was blown into the side of an Alaska Airlines flight using one of the jets earlier this month, prompting temporary groundings and thorough inspections from the FAA.</p>



<h2 class="wp-block-heading" id="h-key-facts">KEY FACTS</h2>



<p>Boeing will be prohibited from expanding production of its Max jets, including the 737-9 Max model, under the order from the FAA on Wednesday.</p>



<p>The FAA also said it approved an inspection and maintenance process that will be performed on all of the 171 grounded Boeing 737-9 Max planes, which if successful, will make the aircraft eligible to return to service.</p>



<p>The inspection and maintenance process was approved after the FAA reviewed data collected from inspections on 40 grounded planes.</p>



<p>Maintenance performed on the aircraft will involve inspection of exit door plugs and parts associated with them, bolts, guide tracks and the correction of damage.</p>



<p>FAA Administrator Mike Whitaker said in a statement that the extensive review of the planes wouldn’t mark a return to “business as usual for Boeing.”</p>



<h2 class="wp-block-heading" id="h-key-background">KEY BACKGROUND</h2>



<p>The National Transportation Safety Board is&nbsp;<a href="https://www.forbes.com/sites/siladityaray/2024/01/09/investigators-will-probe-if-alaska-airlines-737-maxs-door-panel-was-securely-bolted/?sh=1f28f5fd6228">investigating</a>&nbsp;whether or not the door panel that blew off the Alaska Airlines flight was properly bolted before takeoff. Investigators have found the plane’s plug door but have yet to recover the bolts associated with it. The FAA recommended this week that airlines inspect door plugs on Boeing 737-900ER aircraft, a different model from the one involved in the Alaska Airlines incident. The agency, which said the 737-900ER’s door plugs “have an&nbsp;<a href="https://www.forbes.com/sites/siladityaray/2024/01/22/faa-asks-airlines-to-inspect-door-plugs-on-boeing-737-900er-planes/?sh=7222a8fafe91">identical door plug design</a>” to the Max 9, asked airlines to inspect four points where a bolt is used to secure the door to the airframe of the 737-900ER.</p>



<h2 class="wp-block-heading" id="h-further-reading">FURTHER READING</h2>



<p><a href="https://www.forbes.com/sites/siladityaray/2024/01/22/faa-asks-airlines-to-inspect-door-plugs-on-boeing-737-900er-planes/?sh=7222a8fafe91">FAA Asks Airlines To Inspect Door Plugs On Boeing 737-900ER Planes</a>&nbsp;(Forbes)</p>


FAA Clears Way For Boeing 737 Max 9s To Potentially Resume Flying—But Prohibits Increased Production


<h2 class="wp-block-heading" id="h-topline">TOPLINE</h2>



<p>The Federal Aviation Administration announced Thursday it’s investigating whether Boeing failed to ensure its planes were safe for flying after a a “plug” door fell off a 737 Max 9 plane flying from Portland, Oregon.</p>



<h2 class="wp-block-heading">KEY FACTS</h2>



<p>The FAA&nbsp;<a href="https://twitter.com/FAANews/status/1745491519266542047" target="_blank" rel="noreferrer noopener">said</a>&nbsp;it notified Boeing of the investigation, saying it was prompted by the Alaska Airlines 1282 flight, where a “plug” type passenger door blew off the Boeing Model 737 Max 9 plane mid-air, prompting an emergency landing.</p>



<p>Every Boeing 737 Max 9 with a “plug” door has been grounded since Saturday.</p>



<p>The FAA said that the “incident should have never happened and it cannot happen again.”</p>



<p>In a&nbsp;<a href="https://www.boeing.com/737-9-updates/index.page" target="_blank" rel="noreferrer noopener">statement</a>&nbsp;Thursday, Boeing said it would cooperate “fully and transparently” in both the FAA investigation and an ongoing National Transportation Safety Board investigation.</p>



<h2 class="wp-block-heading">KEY BACKGROUND</h2>



<p>Safety concerns regarding Boeing’s 737 Max 9 planes have continued since the Jan. 5 incident. Both Alaska Airlines and United Airlines—the two U.S. airlines that use the 737 Max 9 planes—have&nbsp;<a href="https://www.reuters.com/business/aerospace-defense/no-data-captured-alaska-airlines-737-cockpit-voice-recorder-ntsb-chair-2024-01-08/" target="_blank" rel="noreferrer noopener">reported</a>&nbsp;finding loose parts on grounded Max 9 aircraft. And Wednesday, Alaska Airlines&nbsp;<a href="https://www.forbes.com/sites/tylerroush/2024/01/10/alaska-airlines-cancels-all-boeing-737-max-9-flights-this-week-after-hole-blown-into-plane-during-flight/?sh=6d5a18062273">canceled</a>&nbsp;all flights using Boeing 737 Max 9 planes, awaiting instruction from the FAA. It represents the latest major safety setback for Boeing, which garnered international scrutiny in 2019, two Boeing 737 Max 8 planes were involved in fatal crashes within the span of less than a year. The National Transportation Safety Board is also conducting an investigation into the Alaska Airlines incident, and has since&nbsp;<a href="https://www.forbes.com/sites/roberthart/2024/01/08/jet-door-blown-off-alaska-airlines-plane-is-found-in-oregon-schoolteachers-backyard/?sh=2aa3337e2d43">found</a>&nbsp;the plane door, which landed in an Oregon school teacher’s backyard.</p>



<h2 class="wp-block-heading">TANGENT</h2>



<p>Elon Musk has used the Boeing incident to continue his attacks on diversity, equity and inclusion corporate policies, implying without evidence on X in recent days that the plane-maker’s pursuit of diversity may have made air travel less safe. The posts drew <a href="https://www.nbcnews.com/tech/internet/elon-musk-boeing-dei-diversity-x-posts-pilots-rcna133351" target="_blank" rel="noreferrer noopener">rebuke</a> from civil rights groups.</p>



<h2 class="wp-block-heading">WHAT WE DON’T KNOW</h2>



<p>When the grounding of Boeing planes with “plug” doors may end. The FAA said in its Jan. 9 announcement that “the safety of the flying public, not speed, will determine the timeline for returning the Boeing 737-9 Max to service.”</p>


Boeing Under Investigation For 737 Max 9


<p><a href="https://policies.google.com/privacy" target="_blank" rel="noreferrer noopener"></a>TOPLINE Boeing’s board of directors agreed Friday to pay the company hundreds of millions of dollars and impose new safety measures, closing out a lawsuit brought by Boeing shareholders that began after two crashes of the latest version of its best-selling passenger jet killed hundreds of people and caused regulators to ground the jet worldwide.</p>



<h2 class="wp-block-heading" id="h-key-facts">KEY FACTS</h2>



<p>The proposed settlement — which a Delaware state judge&nbsp;<a href="https://www.wsj.com/articles/boeing-board-to-add-safety-expert-make-other-changes-in-737-max-settlement-11636150675" target="_blank" rel="noreferrer noopener">still needs to approve</a>&nbsp;— comes more than a year after New York State Comptroller Thomas P. DiNapoli and the Fire and Police Pension Association of Colorado&nbsp;<a href="https://www.osc.state.ny.us/press/releases/2020/08/new-york-state-comptroller-dinapoli-fire-and-police-pension-association-colorado-announce-appointment" target="_blank" rel="noreferrer noopener">sued</a>&nbsp;Boeing’s directors.</p>



<p>As part of the settlement, members of Boeing’s board of directors agreed to pay $237.5 million directly to the company — a sum that will come from the directors’ insurers — according to a copy of the&nbsp;<a href="https://www.osc.state.ny.us/files/press/pdf/stipulation-of-settlement-boeing.pdf" target="_blank" rel="noreferrer noopener">agreement</a>&nbsp;released Friday evening by DiNapoli’s office.</p>



<p>Boeing will also hire an ombudsperson to serve as a “neutral third party” to handle any concerns from&nbsp;<a href="https://www.faa.gov/other_visit/aviation_industry/designees_delegations/delegated_organizations/" target="_blank" rel="noreferrer noopener">company employees</a>&nbsp;who work with the Federal Aviation Administration.</p>



<p>The board of directors will add a new member with experience in “aviation/aerospace, engineering, and/or product safety oversight,” and moving forward, it’s expected to ensure at least three board members have a background in those areas.</p>



<p>The settlement agreement noted the defendants “have denied and continue to deny” any allegations of wrongdoing.</p>



<p>Boeing told&nbsp;<em>Forbes&nbsp;</em>in a statement the company has already “taken significant actions to reinforce and strengthen our commitment to aviation safety,” and said the settlement “builds on those actions with additional oversight and governance reforms.”</p>



<h2 class="wp-block-heading" id="h-crucial-quote">CRUCIAL QUOTE</h2>



<p>“This settlement will send an important message that directors cannot shortchange public safety and other mission-critical risks,” DiNapoli, whose office oversees New York’s pension fund for government employees, said in a&nbsp;<a href="https://www.osc.state.ny.us/press/releases/2021/11/nys-comptroller-dinapoli-and-fire-and-police-pension-association-colorado-statements-proposed" target="_blank" rel="noreferrer noopener">statement Friday</a>.</p>



<h2 class="wp-block-heading" id="h-key-background">KEY BACKGROUND</h2>



<p>Boeing’s first 737 MAX entered service in <a href="https://www.boeing.com/company/about-bca/washington/737max-1st-delivery-05-17-17.page" target="_blank" rel="noreferrer noopener">2017</a>, the latest iteration of the company’s best-selling plane, which first flew in 1967. But the new version of the plane was grounded worldwide and deliveries halted after the crash of a MAX jet in Ethiopia in March 2019, which came five months after a crash in Indonesia.The crashes, which killed 346 people, were <a href="https://www.nytimes.com/2019/09/18/magazine/boeing-737-max-crashes.html" target="_blank" rel="noreferrer noopener">blamed on</a> a faulty addition to the flight control system that hinged on a <a href="https://www.nytimes.com/2019/06/01/business/boeing-737-max-crash.html" target="_blank" rel="noreferrer noopener">single sensor</a>, causing the planes to pitch downward if it sensed that the plane’s angle of attack was too high. The FAA eventually cleared the MAX to return to service <a href="https://www.forbes.com/sites/jemimamcevoy/2020/11/18/boeing-737-max-cleared-to-fly-again-after-nearly-two-years/?sh=1ffba36b704e">late last year</a>. But DiNapoli and the Colorado pension plan argued the disaster was linked to a broader lack of attention to safety by board members, who they <a href="https://www.osc.state.ny.us/press/releases/2020/08/new-york-state-comptroller-dinapoli-fire-and-police-pension-association-colorado-announce-appointment" target="_blank" rel="noreferrer noopener">claimed</a> “breached their fiduciary duties to the company by dismantling Boeing’s lauded safety-engineering corporate culture in favor of what became a financial-engineering corporate culture.” The two shareholders <a href="https://www.osc.state.ny.us/press/releases/2020/08/new-york-state-comptroller-dinapoli-fire-and-police-pension-association-colorado-announce-appointment" target="_blank" rel="noreferrer noopener">served as lead plaintiffs</a> in a lawsuit filed against the board <a href="https://www.osc.state.ny.us/files/press/pdf/stipulation-of-settlement-boeing.pdf" target="_blank" rel="noreferrer noopener">on Boeing’s behalf</a>, an arrangement known as a “derivative lawsuit.”</p>



<p><strong><em>By <meta charset="utf-8">Joe Walsh, Forbes Staff</em></strong></p>


Boeing Directors Settle Shareholder Lawsuit Over 737 MAX Crashes For $237.5 Million


<p><strong><span class="has-inline-color has-vivid-red-color">Topline</span></strong>: After 20 long and turbulent months of being grounded, the Boeing 737 MAX is ready to take off into the skies as it gets approval to return to commercial service, says the U.S.  Federal Aviation Administration (FAA) on Wednesday, November 18.  This follows after The Boeing Company had to suspend the services of the airplanes due to the crash of Ethiopian Airline’s Boeing 737 MAX in March 2019.</p>



<h4 class="wp-block-heading"><strong><span class="has-inline-color has-vivid-red-color">Key Facts</span></strong></h4>



<ul class="wp-block-list"><li>The FAA released a<em> </em><a href="https://www.faa.gov/foia/electronic_reading_room/boeing_reading_room/media/737_RTS_Summary.pdf"><em>comprehensive and methodical safety review process</em></a><em> </em>report on Wednesday that took 20 months to complete. The report is to address the safety issues regarding the plane.&nbsp;</li><li>Boeing 737 MAX was grounded in March 2019 when 346 lives were lost within a five-month timeline.&nbsp;</li><li>On October 29, 2018, a Lion Air&nbsp; Boeing 737 MAX crashed after taking off from Jakarta, Indonesia. 13 minutes after takeoff, Flight 610 crashed killing 189 people.</li><li>Five months later, Ethiopian Airlines Flight 302 crashed shortly after take-off on March 10 killing all 149 people on board.&nbsp;</li><li>This led to many big airlines having to ground their Boeing 737 Max planes due to safety concerns. This included the Civil Aviation Administration of China (CAAC) who ordered all Chinese airlines to ground their Boeing 737 MAX 8 jets a day after the fatal Ethiopian crash. American Airlines, Comair Airways, and Ethiopian Airlines are just to name a few that also made the decision to ground their 737s.&nbsp;</li><li>“Throughout our transparent process, we cooperated closely with our foreign counterparts on every aspect of the return to service. Additionally, FAA Administrator Steve Dickson personally took the recommended pilot training and piloted the Boeing 737 MAX, so he could experience the handling of the aircraft firsthand,” the FAA statement read.&nbsp;</li><li>This stamp of approval allows airlines that are under the FAA&#8217;s jurisdiction to take the necessary steps to resume services.&nbsp;</li></ul>



<h4 class="wp-block-heading"><strong><span class="has-inline-color has-vivid-red-color">Crucial Numbers</span></strong></h4>



<p>According to <a href="https://edition.cnn.com/2020/11/17/business/boeing-737-max-grounding-cost/index.html">CNN</a>, Boeing stated that this longest grounding in commercial aviation history has cost the company $20 Billion. This includes $8.6 billion to compensate customers who had their planes grounded, $5 billion for unusual costs of production, and $6.3 billion for increased costs of the 737 Max program.</p>



<h4 class="wp-block-heading"><strong><span class="has-inline-color has-vivid-red-color">Crucial Quote</span></strong></h4>



<p>&#8220;We will never forget the lives lost in the two tragic accidents that led to the decision to suspend operations,&#8221; said David Calhoun, chief executive officer of The Boeing Company. &#8220;These events and the lessons we have learned as a result have reshaped our company and further focused our attention on our core values of safety, quality, and integrity.&#8221;</p>


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