What Happens Now, After the Boeing Crashes?

Inevitably, there will be debate about the FAA, expert says

Mar 20, 2019
Technology

SMITH BRAIN TRUST  It took days of pressure from airlines, policymakers and regulators around the world before the Federal Aviation Administration announced the grounding of the Boeing 737 Max-8. "The FAA and the United States came across as being very reactive and lacking leadership. Looking at it objectively, the FAA sought to make an initial assessment before making its decision, which is quite reasonable. However, inevitably there will be debate about whether it acted quickly enough," says Maryland Smith’s Michael Ball.

“The FAA, to its credit, is very conservative about safety. It doesn’t approve something until it has gone through its rigorous and scientific testing,” he says. “However, once an aircraft is in the field, more judgment is involved in reacting to events.”

Ball has a joint appointment within the Institute for Systems Research (ISR) in the Clark School of Engineering and is a member of the Decision, Operations and Information Technologies Department in the University of Maryland's Robert H. Smith School of Business. He also is co-director and principal investigator of NEXTOR-II, an eight-university consortium funded by the FAA to carry out research in aviation operations.

For aircraft manufacturer Boeing, the coming months are likely to bring a reexamination of its processes as well, Ball adds.

After the second Max-8 crash, news emerged that several pilots had expressed concerns to Boeing about insufficient training on new Max-8 control features. “At Boeing, there should be and will be some soul-searching about this process,” Ball says.

Boeing wanted to produce the Max-8, its fastest-selling aircraft, without requiring pilots to spend time training extensively, as is standard with a new model, rather than an update. “That retraining costs the airlines a lot of money,” Ball explains. “Aircraft manufacturers must make such tradeoffs all the time and as the systems become more complex the tradeoffs become more difficult to make.”

Historically, Ball adds, the most common impetus for changes in aviation policy has been aviation disasters. While I don't think the investigation into the relationship between Boeing and the FAA will lead to a smoking gun indicating major malfeasance, it is likely that quite significant changes will be made in the safety oversight process.

Uncharted territory

A pair of deadly crashes, just five months apart, has rattled confidence in a popular line of aircraft, causing countries around the world to ground the planes and leaving airlines scrambling to refund or rebook thousands of customers. “Boeing will get through this,” Ball says. “But it will take time.”

Fixing the Max-8: The aircraft’s problem, Ball says, appears rooted in software. “Not to minimize the issue, but software can be fixed. It’s not a fundamental issue with the aircraft. There is also the possibility of sensor malfunction, which would represent a more significant problem.” A software fix, he says, likely will take months to complete and thoroughly test. The FAA, meanwhile, has said it has grounded the aircraft until at least May.

Reputational damage: The reputational damage for Boeing, the world’s largest aerospace manufacturer, may linger. Days after the Max-8 grounding, flight-booking website Kayak launched a search feature that allows users to exclude specific plane models from search results. “But over time, that reputational damage will go away,” he says.

Financial damage: Globally, there were about 370 of Max-8s in operation and nearly 5,000 more on order when the second crash happened. “That’s a huge backlog of orders, and that’s not just going to go away,” says Ball. When airlines order aircraft, they put down a big deposit – generally 20 percent on an order that’s priced in millions.

Most airlines can’t afford to walk away from that kind of money, nor lose their place in line. However, there’s been talk of airlines suing Boeing for time lost on their grounded planes and other expenses related to the Max-8 issues. “That’s a legitimate thing they can sue for,” Ball says.

Safety picture: The Max-8 crashes, the first in Indonesia and the second in Ethiopia, left 346 people dead. Nonetheless, today’s aviation industry is safer than it’s ever been, Ball notes. Go back 30 years, he says, and there were multiple commercial aircraft crashes every year, in the United States alone. Today, that’s not the case. The most recent crash in the U.S. was a decade ago.

“A lot of that is because of the technology. Even though planes are getting more complex, and there is this debate about how much control pilots should have versus the technology, the fact is the technology has substantially improved the safety of the systems in the past 30 years,” Ball says. “The improvements are dramatic and measurable.”

GET SMITH BRAIN TRUST DELIVERED
TO YOUR INBOX EVERY WEEK

SUBSCRIBE NOW

Tags: 

About the Expert(s)

Michael O. Ball

Michael Ball is the Senior Associate Dean for Faculty and holds the Dean's Chair in Management Science at the Robert H. Smith School of Business at the University of Maryland. He also has a joint appointment within the Institute for Systems Research (ISR) in the Clark School of Engineering and is a member of the Decision, Operations and Information Technologies Department within the Smith School.

More In

Finance

The Central Bank Digital Currency Pivot

How will things change when the banking systems have central bank digital currencies in place? Our experts take a look.

Oct 14, 2020
TikTok’s Ban and What It Means for Chinese Globalization

What are the implications of the recent U.S. pressure on TikTok and WeChat, including what it means for Chinese globalization?

Aug 26, 2020
‘De-Sinicization’ and Manufacturing in China

How will de-sinicization and the new challenges in manufacturing change the world's second-largest economy? 

Jul 28, 2020
Robert H. Smith School of Business
Map of Robert H. Smith School of Business
University of Maryland
Robert H. Smith School of Business
Van Munching Hall
College Park MD 20742