Aerospace giant Boeing is one of the biggest names in the industry. But its many scandals cast a dark shadow over its reputation, especially after the 2018 Lion Air crash in Indonesia and the 2019 Ethiopian Airlines crash in Ethiopia. A more recent incident involved the door plug of a Boeing 737 Max 9 operated by Alaska Airlines blowing out mid-flight. Combined, these events resulted in the Boeing controversy, raising serious questions about safety and quality control within the company.
Our Business2Community experts have outlined the controversy, namely the Boeing 737 Max scandal of 2018 and 2019, and the Boeing 737 Max 9 incident of 2024, by analyzing reports, news articles, videos, and interviews.
Boeing Controversy – Key Facts
- In 2018 and 2019, two Boeing 737 Max planes crashed due to the aircraft’s design and software faults. A total of 346 people lost their lives.
- In 2024, a Boeing 737 Max 9 operated by Alaska Airlines had its door plug blow out on air.
- As a result, Boeing experienced a significant drop in its shares, fraud charges, leadership changes, and its first net loss.
The Story of the Boeing Controversy
In January 2024, the door plug of a Boeing 737 Max 9 blew out in the middle of the flight. This incident revived memories of the Boeing 737 Max aircraft scandals of 2018 and 2019, which resulted in the loss of 346 passengers’ lives.
Boeing 737 Max Scandals of 2018 and 2019
One of the biggest aerospace companies in the world, Boeing would start 2018 by making history — this was the year it reached a sales volume of $100 billion. However, the same year, the company got involved in a huge scandal that changed its public perception.
In October 2018, a Boeing 737 Max operated by Indonesian airline Lion Air (Flight 610) crashed 13 minutes after taking off from Jakarta. None of the 189 people on board survived. Both the Federal Aviation Administration (FAA) and Boeing started analyzing the need for software or design changes to the Boeing 737 Max jets.
Only five months after the Lion Air crash, Boeing was involved in a similar case, this time with an Ethiopian Airlines flight. In March 2019, an Ethiopian Airlines Boeing 737 Max traveling from Addis Ababa to Nairobi crashed near Bishoftu, 62 kilometers from Addis Ababa.
Before the crashes, several former Boeing employees had filed complaints about the company’s working conditions and safety protocols.
What Happened to the Boeing Whistleblower?
John Barnett, a former Boeing quality inspector who had worked for the company for over thirty years, raised concerns about safety flaws in Boeing aircraft as early as 2017. He warned aviation authorities about potentially “catastrophic” safety issues.
Barnett was found dead in March 2024 from what appeared to be a self-inflicted gunshot wound. According to his family, he was suffering from post-traumatic stress disorder and anxiety attacks due to the work environment at Boeing.
Another whistleblower, Joshua Dean was a quality auditor at Boeing supplier Spirit AeroSystems. He filed a complaint with the Federal Aviation Administration, saying there was “serious and gross misconduct by senior quality management” on the Boeing 737 Max production line.
Dean’s family announced his death on social media in 2024, due to a bacterial infection.
Boeing Door Plug Incident of 2024
The Boeing controversies did not end with the 2019 scandal. In January 2024, an Alaska Airlines Boeing 737 Max 9 door plug blew out mid-flight at 16,000 feet over Oregon. Luckily, no one was seated directly next to the faulty panel, and the plane was at a relatively low altitude, so no one was killed. The door was then found in the backyard of an Oregon schoolteacher.
Alaska Airlines grounded its fleet of Boeing 737 Max 9s and received initial compensation of $160 million from Boeing due to the financial damages of the incident.
More Whistleblower Complaints
Another whistleblower and Boeing engineer Sam Salehpour filed a formal complaint with the FAA in January 2024. Made public in April 2024, his whistleblower complaint alleged that the company took shortcuts when manufacturing its 777 and 787 Dreamliner jets.
Salehpour said he continuously raised concerns but was told to “shut up”.
Investigations into Boeing
Both the Lion Air and Ethiopian Airlines crashes were attributed to a faulty automated flight control system known as MCAS (Maneuvering Characteristics Augmentation System). Boeing implemented this system to counteract the aircraft’s aerodynamic issues.
Notably, this problem all came down to avoiding training costs. Boeing wanted to install new, larger and more efficient engines to match its rival, Airbus’ updated A320 model. The problem is that there wasn’t enough room to place these larger engines under the wings of 737 planes so it had to put them partially in the wing. To help sell its new plane, dubbed the 737 Max, it told airlines that it only needed minimal pilot training because it was so similar to the old models.
The 737 Max immediately became the best-selling airplane of its kind, but there was a major problem waiting in the wings (literally). Because of the awkward placement of the engines, the plane would nose up more than usual at full power (like during takeoff). To fix this, Boeing created the MCAS system which helped push the nose of the plane down to a normal level. Unfortunately, many pilots were never informed of the problem or the MCAS system, leading to the 2 devastating crashes.
Vox made a great explainer video explaining the situation if you want to learn more.
The US National Transportation Safety Board (NTSB) issued seven recommendations to the Federal Aviation Administration in 2019 about the following:
- Aircraft certification process.
- The assumptions that the FAA allows manufacturers to use for pilot responses to flight control failure conditions.
- Standardized methodology to evaluate and validate assumptions about pilot recognition and response to failure conditions.
- The airplane systems that can more clearly and concisely inform pilots of the highest priority actions.
As for the 2024 door plug incident, the National Transportation Safety Board said Boeing “blatantly violated NTSB investigative regulations”. Boeing apologized to both the NTSB and the families of the plane crash victims.
Boeing CEO directly apologizes to families of 737 MAX plane crash victims at Senate hearing.
"I apologize for the grief that we have caused." pic.twitter.com/l6igXFCCqn
— The Daily Signal (@DailySignal) June 18, 2024
The National Transportation Safety Board’s preliminary investigations found that four bolts that were supposed to hold the door plug in place were missing.
In March 2024, a six-week FAA audit found “multiple instances where the companies failed to comply with manufacturing quality control requirements” for Boeing and its supplier Spirit AeroSystems’ production process.
Other Boeing Aircraft Incidents
In March 2024, a United Airlines Boeing 777-200 lost a tire mid-air after taking off from San Francisco. Headed for Japan, the plane landed safely at Los Angeles International Airport.
Four months later in July, a United Airlines Boeing 757-200 lost a landing gear wheel during takeoff from Los Angeles but managed to land at its planned destination in Denver. The airline company initiated an investigation into the incident after recovering the wheel in Los Angeles.
Meanwhile, in May of the same year, a FedEx Boeing 767 cargo plane was forced to make an emergency landing without a front wheel in Istanbul. The plane was en route from Paris Charles De Gaulle and needed to be guided down to land on its back wheels and fuselage.
@abcnewsaus A FedEx Airlines cargo plane landed at Istanbul Airport without the front landing gear deployed and managed to stay on the runway. Plane Boeing AirTraffic Istanbul ABCNews
The Consequences of the Boeing Controversy
The consequences of the Boeing controversies do not end with Boeing losing money — passengers and airline staff lost their lives, thousands of people raised safety issues, and the company continues to face severe regulatory scrutiny.
Here are the key consequences:
Boeing 737 Max and Max 9 Groundings
Following the Ethiopian Airlines crash, the FAA grounded the Boeing 737 Max for 20 months. The decision to ground came after the air safety regulators of 51 countries barred the flights with the 737 Max.
Boeing lost $20 billion in direct costs while reimbursing customers, paying for unusual production costs, and making up for the increased costs of the 737 Max program.
The grounding was rescinded in November 2020 after a detailed safety review.
Boeing 737 Max 9s were grounded after the 2024 Alaska Airlines flight, as the FAA once again investigated Boeing’s manufacturing practices and production lines. In late January, the FAA approved a “thorough inspection and maintenance process” for Max 9 to begin flying again.
“We grounded the Boeing 737-9 Max within hours of the incident over Portland and made clear this aircraft would not go back into service until it was safe,” said FAA administrator Mike Whitaker.
“This won’t be back to business as usual for Boeing. We will not agree to any request from Boeing for an expansion in production or approve additional production lines for the 737 MAX until we are satisfied that the quality control issues uncovered during this process are resolved,” he added.
Drop in Boeing Stocks and Market Value
Boeing’s stocks dropped by 11% four days after the 2019 Ethiopian Airlines flight, and by 10% after the 2024 Alaska Airlines flight.
The screenshot below shows the company’s stocks where there are several declines — in 2018 due to the Lion Air scandal, in 2019 due to the Ethiopian Airlines crash, in 2020 due to the COVID-19 pandemic, and in 2024 due to the Alaska Airlines incident.
Boeing’s First Net Loss
Boeing reported its first net loss in 2019, due to 737 Max order cancellations and the sharp decline in its stock value.
The same year, Boeing’s main competitor Airbus generated $78.9 billion, surpassing Boeing’s revenue.
Leadership Changes
Former CEO Dennis Muilenburg stepped down in December 2019, leaving his place to David Calhoun.
According to the Boeing board, this change was necessary to rebuild trust with regulators and stakeholders, and to regain credibility for the company. Both the Lion Air and Ethiopian Airlines crashes of 2018 and 2019 happened during Muilenburg’s tenure. In total, 346 people died.
Families of the victims said they had been asking for a leadership change for a long time.
“The CEO reluctantly and deliberately kept the aircraft in service after the Lion Air crash. The Ethiopian Airlines crash was a preventable accident,” said Ababu Amha who lost his wife in the Ethiopian Airlines flight, in an interview with PBS News.
In March 2024, two months after the Alaska Airlines flight, Dave Calhoun announced he intended to step down as CEO. He had intended to stay on until the end of 2024, but at the start of August 2024, industry stalwart Kelly Ortberg was confirmed as the new CEO as of August 8, 2024.
Fraud Charges
In January 2021, Boeing entered into a deferred prosecution agreement (DPA) with the US Department of Justice. The aerospace giant admitted to having deceived the FAA about the Maneuvering Characteristics Augmentation System (MCAS), which was a significant factor in the fatal Lion Air and Ethiopian Airlines crashes.
Under the terms of the DPA, Boeing agreed to pay over $2.5 billion, including a criminal monetary penalty, compensation to airline customers, and a fund for the victims’ families. The agreement also required Boeing to enhance its compliance programs and maintain transparency with the FAA.
In July 2024, Boeing agreed to plead guilty to one charge of conspiracy to defraud the United States. The families of the victims were not happy with the deal. “This sweetheart deal fails to recognize that because of Boeing’s conspiracy, 346 people died,” said Paul Cassell, a law professor representing many victim families. It’s important to note that reporting from TheLever uncovered that Lisa Monaco, the Attorney General who presided over the decision to prosecute Boeing or make a deal, was once on the company’s payroll as a consultant. It’s unknown why she did not recuse herself from the case.
Prosecutors have reportedly recommended criminal charges against Boeing.
The decision on whether or not to prosecute is overseen by Deputy AG Lisa Monaco, who was a Boeing consultant & who’s kept corporate prosecutions near a record low.
Let it sink in.https://t.co/aumeYApA2h pic.twitter.com/D2ATdXpS7r
— David Sirota (@davidsirota) June 25, 2024
Loss of Consumer Trust
The safety concerns, fatal crashes, loose bolts, and ignored whistleblowers have led Boeing to lose customer trust. Business intelligence company Morning Consult conducted a survey to assess how much US adults, frequent flyers, and business travelers trusted Boeing before and after the incident.
The survey found that net trust for Boeing dropped by 14 percentage points for all US adults, 16 percentage points for frequent flyers, and 26 percentage points for business travelers between Q4 2023 and Q1 2024.
What Can We Learn From the Boeing Controversy?
According to research analyst and writer Josh Bersin, Boeing shifted its focus from engineering excellence to profit after its 1997 merger with McDonnell Douglas. This cultural shift led to compromises in safety and engineering, with the aim of making more money.
Whistleblower and Boeing engineer Sam Salehpour’s statements support Bersin’s statements:
“I was ignored, I was told not to create delays. This is not a safety culture, where you get threatened [for] bringing issues,” he said according to an article reported by the BBC News, when talking about how he was treated for raising safety concerns.
A shift from safety to profit has serious consequences, especially in industries like aviation, where human lives are directly involved. Now, Boeing is in more trouble than ever, losing both its public trust and profits.
Companies in similar industries must prioritize safety and listen to employees who are directly involved in production.