Boeing CEO chastised by FAA as tensions risk 737 Max delay

Bloomberg

The US’s top aviation regulator took Boeing Co.’s chief to the woodshed in a sign that relations between the two sides have deteriorated and further delays in the return to service of the planemaker’s best-selling jet are likely.
In an unusual public admonishment, Federal Aviation Administration head Steve Dickson presented Boeing Chief Executive Officer Dennis Muilenburg and Executive Vice President for Commercial Airplanes Stan Deal with a litany of grievances.
“The administrator recommended to Mr. Muilenburg that Boeing’s focus should be on the quality and timeliness of data submittals for FAA review,” the agency said in an email to lawmakers after the meeting. “He made clear that FAA’s certification requirements must be 100% complete before return to service.”
The meeting — called by the FAA to address what it said was Boeing’s unrealistic timetable for returning the 737 Max to service — was a sign of growing rancor between the two sides and came as skepticism grew that the plane would be able to resume flights soon. American Airlines Group announced it’s further delaying a return of planes to its schedule.
Boeing shares fell 1.1% to $346.29 on December 12, and were indicated higher at $348.94 today in pre-market trading ahead of the US open. Delays in winning approval for fixes to the 737 Max have prompted it to slow a planned increase in production.
Dickson was grilled for hours by the House Transportation & Infrastructure Committee over the FAA’s decision to allow the 737 Max to continue flying after the initial fatal crash off the coast of Indonesia involving the aircraft on October 29, 2018. The plane was grounded after a second crash in Ethiopia on March 10. The crashes killed 346 people and have led to the longest US airliner grounding in the jet age.
There have been signs for months that tension is growing between Boeing and the FAA, and in recent days officials hinted they may be eyeing an enforcement action against the Chicago-based planemaker.
The FAA has complained that Boeing’s projections of when it will return its grounded 737 Max to service are too optimistic and are an attempt to put pressure on the agency, according to an email to lawmakers sent Thursday before the meeting.
Afterward, the company said Muilenburg and Deal sought to reassure Dickson and said that they were committed to addressing “all the FAA’s questions.”
“We will work with the FAA to support their requirements and their timeline as we work to safely return the Max to service in 2020,” the company said in the statement.
Boeing is pushing back plans to increase production rates for the Max as the regulatory approval process drags on, according to a person familiar with the matter. The manufacturer, currently building 42 of the planes a month, expects to reach a rate of 57 a month in early 2021, several months beyond its previous plans for the end of 2020, said the person, who asked not to be identified.