Boeing’s ouster of CEO Dennis Muilenburg could help get the beleaguered 737 Max back into service for airlines such as Southwest and American after regulators grew frustrated with the airplane maker. But that doesn’t mean it’ll be flying again any sooner, analysts said.
Muilenburg resigned Monday after a series of missteps nine months after worldwide aviation regulators grounded Boeing’s best-selling plane. Dallas-based Southwest and Fort Worth-based American are among the two largest owners of the 737 Max but have had to wait along with other airlines while the Federal Aviation Administration makes sure it’s safe to fly again.
“At the end of the day, the regulators are in charge and not Boeing,” said Richard Aboulafia, an aviation consultant with the Teal Group, an aerospace and defense market analysis firm. “The most you can say is that a new leader might be able to repair relations with the FAA.”
Replacing Muilenburg is Boeing chairman and Blackstone Group executive David Calhoun, who now must navigate the Chicago-based company through skeptical regulators and angry lawmakers overseeing the 737 Max’s return. Boeing said its board of directors made the change to “repair relationships with regulators, customers, and all other stakeholders.”
Aerospace industry analyst Hunter Keay said new leadership at Boeing may slow down or even reset some of the recertification process.
“But longer term, we believe this reduces the previously minuscule chance that the 737 MAX never returns to service,” Keay said in a research note Monday.
Southwest and American have balanced a need for airplanes with public concerns since the Max was grounded in March after crashes that killed 346 people in Indonesia and Ethiopia.
Southwest owns 34 of the 737 Max planes, more than any other airline. It was supposed to get another 41 this year and was counting on the plane to bolster growth. American had 24 of the grounded jets and was counting on having 40 by the end of 2019.
New FAA Administrator Stephen Dickson has been adamant that the agency won’t rush the recertification of the plane and wants to make certain that fixes to faulty antistall software make the plane safe. He met with Muilenburg two weeks ago to “directly address the perception that some of Boeing’s public statements have been designed to force FAA into taking quicker action,” according to a letter sent to lawmakers.
Boeing has been under pressure after a series of missteps and negative announcements coming with Muilenburg in charge. In November, lawmakers lambasted Boeing leadership for controversial messages between 737 Max test pilots that appear to show internal concerns about the plane’s antistall software.
Muilenburg, 55, had been CEO of Boeing since 2015, after the 737 Max design process started but before the plane was certified.
Then there was the meeting with Dickson and news last week that Boeing would temporarily shut down 737 Max production with 400 planes sitting and waiting to be delivered to customers.
Some analysts have said the 737 Max could be recertified by the end of February at the earliest. But that timeline is guesswork as the FAA has said it will take whatever time it needs.
American and Southwest said they will wait until at least April to put it back on schedules. Chicago-based United is waiting until June.
Leaders at Southwest and American, who have shown increasing frustration with Boeing, said they’re pleased with new leadership at Boeing. Former Continental Airlines CEO Lawrence Kellner is taking Calhoun’s place as Boeing’s board chairman. Kellner also chairs the board of Sabre Corp., a leading technology provider to the travel industry that’s based in Southlake.
“We share a mutual desire with Boeing to safely and confidently return the Max aircraft to service,” Southwest CEO Gary Kelly said in a statement. “Dave Calhoun and Larry Kellner are accomplished and well-regarded leaders, and I have known them both for many years.”
Dennis Tajer, a spokesman from the union representing American Airlines pilots, said it doesn’t matter who is in charge at Boeing.
“We have the utmost confidence because we will not be flying this airplane until it has been fixed, fully vetted and we are fully trained on it,” said Tajer, spokesman for the Allied Pilots Association who has flown the 737 Max. “No matter who is in charge, we are the last line of defense.”
The Southwest Airlines Pilots Association, which is suing Boeing for more than $100 million for 737 Max losses, declined to comment because of the pending lawsuit.
In a statement, the unions representing Southwest and United Airlines flight attendants called Muilenburg’s departure “long overdue.”
“The Boeing 737 Max grounding was the result of not only tragedy but also a loss of public trust,” said a statement from Transport Workers Union Local 556 representing Southwest flight attendants and the Association of Flight Attendants at United. “Safety must always come first."
The 737 Max’s journey
Boeing’s 737 Max is a more fuel-efficient update of the company’s popular 737, the best-selling airliner. Here are important events in the Max’s history:
August 2011: Boeing announces the 737 Max models 7, 8 and 9.
August 2015: The first 737 Max plane rolls off the production line.
January 2016: The 737 Max takes its first test flight.
March 2017: Federal Aviation Administration certifies the 737 Max.
May 2017: Malindo Air, a Malaysian subsidiary of Indonesian budget airline Lion Air, is the first to receive a 737 Max.
May 2017: The 737 Max makes its first commercial flight on May 22 from Kuala Lumpur to Singapore.
Oct. 29, 2018: Lion Air flight 610, a Boeing 737 Max 8, plunges into the Java Sea, killing all 189 on board.
March 10, 2019: Ethiopian Airlines flight 302, a Boeing 737 Max 8, crashes after takeoff from Addis Ababa, Ethiopia, killing all 157 people aboard.
The Associated Press