Boeing remains optimistic the 737 MAX will return to service early in the fourth quarter but has warned it may have to suspend production of the troubled plane if that doesn’t happen.
The US manufacturer this week posted the biggest quarterly loss in its history due to the March global grounding of the 737 MAX fleet after fatal crashes in Indonesia and Ethiopia.
It posted a $US2.94 billion net loss for the quarter ending June 30 — compared to a $US2.2m for the same period in 2018 — as a previously announced charge to cover the MAX problems cut revenue by $US5.6 billion.
The company has been working with the US Federal Aviation Administration and other global regulators to get a software fix and new training approved that will address a flight control issue identified in the two crashes.
The issue involved the interaction between the pilots and software known as the Maneuvring Characteristics Augmentation System (MCAS) that pushed down the nose of the aircraft due to erroneous information from an angle of attack sensor.
Recertification has been complicated by an unforeseen microprocessor issue unrelated to MCAS but which the FAA and Boeing have agreed should be addressed in the software date.
Exactly when the plane will be returned to flight will be determined by the FAA and other regulators but Boeing is trying to cover all bases when it comes to meeting their requirements.
It is now hoping to submit its certification package in September for a return to service sometime in October.
“The process is dynamic and involves constant dialogue on outstanding questions and open issues that will continue in the days and weeks ahead, Boeing chief executive Dennis Muilenburg told analysts in a conference call.
“We are committed to working with these regulators to satisfy all of the requirements and to ensure the 737 MAX’s safe return to service.”
The preparation for return to service has already seen Boeing conduct a dozen conferences with airlines and almost 225 simulator sessions to develop, test and demonstrate the new software.
It has also been conducting weekly technical calls with customers to make sure the fleet is ready to return to service when the green light is finally lit.
Production of 737s at the manufacturer’s plant in Seattle was cut to 42 aircraft per month as a result of the MAX crisis.
Muilenburg said that it could maintain that rate as long as its assumption about an early fourth-quarter return to service remained solid.
It would then incrementally step up production back to 57 aircraft per month during 2020.
But he warned the company would need to consider alternatives if the timeline changed considerably.
“And those alternatives could include different production rates,’’ he said.
“They could include a temporary shutdown of the line, not something we want to do, but an alternative that we have to prepare for.
“I think it’s a smart part of our thorough and disciplined process here to make sure we’re covering all scenarios.”
The Boeing boss said the company was confident that the microprocessor issue could be addressed with a software fix rather than a change in hardware, as some people had speculated.
He said the timeline for approving that update and finishing up certification remained uncertain.
On the question of differing requirements by regulators around the world, he noted the FAA had convened a number of multi-regulator boards that included Europe’s EASA, Air Canada and others.
These sessions were bringing together all of the questions from any of the regulators, including five issues reportedly raised by EASA.
“So all of those inputs have been considered in our current timeline analysis and are all consistent with the timeline that we’ve laid out here for submitting our certification package in the September time frame and a return to service in the October time frame,’’ Muilenburg said.
“Now again, that’s a timeline that we base-lined for the moment, but there’s still uncertainty in the exact process that the regulators will step through.”
One area where there has already been public disagreement between regulators is with revised training requirements for the MAX and whether or not it should involve simulator training.
Boeing favors a computer-based training curriculum but Muilenburg said it was also preparing options that involved simulator training for those airlines that want it or where regulators may require it.
“And we do expect in the end that we’ll have a consistent set of computer-based training that all airline customers will use and there will likely be some selective use of simulator-based training,’’ he said.
“ It depends on the maturity of the fleets and whether they already have MAX aircraft or whether MAXes are new to their fleet. It depends on their pilot training curriculum.
“Some airlines will use simulator training as part of their normal recurrent training. Some may want training upfront before they fully return the fleet to service.”
Muilenburg said this was another of the uncertainties the company was working through along with the software update and preparing customers for a return to service.
“We know the work that has to be done. We are on it on a daily basis,’’ he said.
“But the exact timeline for completing all of that and getting regulatory approval across the board is still uncertain, and that’s why we keep saying we’ve made our best estimate of that timeline, but we’re also protecting for uncertainty of that timeline with our scenario planning.”