In the wake of the disastrous Air India plane crash in Ahmedabad, Boeing has reached an important crossroads. This tragic incident casts great doubt on the company’s safety protocols. It further challenges the agency’s operational integrity, in light of the agency’s troubled history in recent years. Boeing cannot sidestep or dilute the culture and systemic challenges created by the accident. Simultaneously, it has to operate under a microscope of increasingly blistering scrutiny from regulators, shareholders, and the public.
Back in April, Boeing had the gall to declare its own “improved operational performance” a result of its “ongoing focus on safety and quality.” With the recent crash, that narrative has really been tested. The 787 Dreamliner welcomed its billionth passenger on board. This milestone victory is increasingly overshadowed by growing concerns over the company’s safety record. In pre-market trading Boeing’s shares were down 5% as of market opening in New York on Thursday morning.
This latest incident has sent the company reeling, which has faced a tumultuous couple of years. The company had to ground its 737 Max model worldwide for 18 months due to a software flaw. This turn almost singularly crushed its fiscal state. Last year, the aerospace behemoth was burning cash at an eye-popping rate of almost a billion dollars per month. This crisis was the result of apparent safety lapses, quality control failures, and a lengthy workers’ strike. In an attempt to mitigate these challenges, Boeing reached a $428 million settlement with Southwest Airlines for financial damages caused by the long-term grounding of its 737 Max fleet.
Boeing’s new ceo, Kelly Ortberg, only recently re-emerged from retirement himself, a little more than a year ago. His mission, to be clear, is to reverse the company’s fortunes. His leadership is under increasing pressure from a wide variety of stakeholders. This pressure was compounded after a recent Deferred Prosecution Agreement with the US Department of Justice (DoJ) that allowed Boeing to narrowly avoid criminal prosecution for acts of “conspiracy to obstruct and impede.” This settlement agreement highlights the sad and dangerous state of play that Boeing has placed itself in.
On top of that, the company is dealing with explosive allegations from ex-employees about its workplace culture and treatment of women. It’s a very scary thing.” — John Barnett, former Boeing quality control manager John Barnett spent more than 30 years building airplanes. Tragically, he died by suicide in March of 2022. Additionally, engineer Sam Salehpour has publicly shared his experiences of harassment and threats after raising safety concerns regarding Boeing’s aircraft. These new incidents add even more to Boeing’s growing reputation nightmare as it continues its effort to regain trust from the flying public.
Most recently, Boeing has been under scrutiny due to reports of the company’s workers forced to fit sub-standard parts on the production line. Such revelations, including those at the Kennedy Space Center, have raised red flags over manufacture practices that may jeopardize safety. Last year, Boeing had a near catastrophe after one of its doors flew off during active flight on an Alaska Airlines aircraft. As a result, the company owed $160 million in damages.
While inquiries into the Air India crash are ongoing, Boeing is realizing their moral obligation to work directly with the airline and share additional information. The company is under tremendous pressure to show that safety and quality are its top priorities following this horrific incident.