Podcast: How Has The Latest MAX Incident Affected Airlines?

Listen in as Aviation Week Network's Karen Walker sits down with editors to discuss how the Alaska Airlines 737 MAX 9 door plug incident has affected airlines globally—and what this means for Boeing.

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Rush Transcript

Karen Walker:

Hello, everyone, and thank you for joining us for Window Seat, our Aviation Week air transport podcast. I'm Air Transport World and Aviation Week Network Air Transport editor-in-chief, Karen Walker. Welcome on board. This week, I am joined by a number of my colleagues across the Aviation Week Network. Routes editor-in-chief, David Casey, Aviation Week Senior Editor Americas, Christine Boynton, and ATW and Routes senior editor, Aaron Karp. So welcome, everyone. Thank you for joining me on what's a very cold and wintry day on both sides of the Atlantic.

What we're going to discuss today is that incident on January 5th when a door plug on an Alaska Airlines 737 MAX 9 blew off seven minutes after takeoff from Portland, Oregon, and that left a large hole in the fuselage and caused a cabin depressurization. It was a terrifying incident for everyone on board and amazingly, and certainly due to the skill of the pilots, the plane was able to land safely and 177 people not only survived, but didn't suffer any serious injury. The U.S. National Transport Safety Board, of course, has launched an investigation, and that will determine the cause of the incident. But in this case, we already know quite a lot. The MAX 9 is the newest of the MAX variants, and this aircraft in particular had only been in service a very short while. The so-called plug only applies to aircraft that are operated by airlines wanting to do that under the MAX's full capacity.

So then in that case, it would provide an additional exit. Where that is not required, as in the Alaska aircraft, it is effectively hidden behind the fuselage wall, so passengers would not be aware it was even there. And not many operators operate this particular version around the world. Nevertheless, the FAA and other regulators have grounded this variant. And during initial inspections, we know that some loose or missing bolts have been found in MAXs. So given the history of the MAX with the two fatal crashes in 2018 and '19, this clearly raises a lot of questions about Boeing and the further supply chain challenges that airlines and lessors face, and that will be the focus of our discussion. Christine, you've been covering this developing story with our Aviation Week editors. Give us a summary of which airlines are affected by the grounding and where things stand right now.

Christine Boynton:

Sure. Thanks, Karen. So Alaska and United Airlines are the two with the most MAX 9s in their fleet. Alaska has 65 and United has 79, and for Alaska, that's about 20% of its fleet. They're also the only two U.S.-based operators. Other airlines with affected aircraft include Copa Airlines and Aeromexico as the third and fourth largest operators of the type, and Turkish Airlines has a few as well. I say affected because overall, the groundings apply to 171 of the 218 MAX 9s delivered by Boeing thus far. Now, those other 47 MAX 9s have exit doors instead of a plug, an active door in case of configurations above 189, or a deactivated one in other cases. Icelandair, for example, has 178-seat MAX 9s with deactivated emergency doors in that spot and are therefore not affected by the groundings. But for affected airlines, those groundings are of course still in place.

And as for impacts on service, even with swapping in other aircraft where possible, Alaska and United have had to cancel between 100 and 200 flights a day. Now, as the investigation you mentioned continues, Alaska's CEO put out an update, and in the update he says the airline's quality and audit teams began a thorough review of Boeing's production quality and control systems last week. Starting this week, the airline will enhance its own quality oversight of Alaska aircraft on the Boeing production line, and those efforts will include hiring to grow its own internal teams to validate work and quality on the production line for the 737. And at this point, both U.S. Airlines, Alaska, and United, have reported finding loose bolts during preliminary inspections of MAX 9 exit door plugs. As for when those aircraft will return to service, that's still an unknown.

Karen Walker:

Right. Thank you, Christine. So yes, while relatively speaking, there's not that many aircraft out there worldwide, the number you just gave about the number of cancellations, daily cancellations that Alaska and United face, that's a big number of cancellations that they're having to deal with. David, you specialize in route networks and planning. So when you've got that sort of cancellations and now uncertainty about deliveries and when aircraft are coming back in service, et cetera, for the airlines and actually for the lessors too, but specifically for the airlines, it's a complicated business handling the whole networks and planning and route situation around that. Airlines were seriously challenged in 2023 by ongoing aircraft and engine delivery and maintenance issues, and now it looks like they've got more uncertainty. Can you talk a little bit about what that means to airlines in terms of route planning?

David Casey:

Yeah, absolutely. As you said, it's a really challenging situation because of delivery delays and maintenance issues are really affecting airlines globally. If you think that carriers a plan in the networks maybe 12, 18 months before a season starts, and the scheduling capacity based on what aircraft they expect to have available at the time, it's a reasonably long time in advance. But as Christine just explained, the MAX 9 issue is the latest of forced groundings at United and Alaska in particular, causing them to cancel between 100 and 200 flights a day. But there's been a whole host of production and supply chain problems that are forcing other carriers around the world to realign their networks and adjust capacity, which has been often many months after those flights were originally planned. Now, on one hand, some of those challenges have helped some airlines financially, because it's been a shortfall in capacity in some markets and it's boosted ticket prices.

But on the other, it's really impeding the growth plans. So we heard from Ryanair recently, which downgraded its passenger forecast for the financial year starting in April 2024 from 205 million passengers to 200 million, and that's because of 737 delays. Group CEO, Michael O'Leary, said that the airline expected to have 57 aircraft delivered by the end of the current financial year to April 2023, but now only expects 50 by the end of June, and this comes after Ryanair had already reduced its schedule this winter because of aircraft delivery delays. So it forced it to cut a number of aircraft based out of Brussels, [inaudible 00:07:15], Dublin, Milan, Bergamo, among others, at pretty short notice. But I suppose perhaps the most maddening thing for carriers is some of the groundings, as you mentioned. So alongside the latest MAX ones, we've seen aircraft being grounded because of supply chain constraints, parts aren't available, but also because of factors like Pratt & Whitney's GTF engine problems that has impacted plenty of A320neo family customers globally.

So I think there's about 40 airlines that have been affected by the GTF issue, including Volaris, Cebu Pacific, Air New Zealand, Wizz, JetBlue. And if you look at, let's say, Volaris, for example, the Mexican ULCC, it's currently got 13 of it's 49 A320neos grounded at the moment, and that has forced it to cut capacity and its growth core forecast. So in 2024, it expects capacity to be lower by between 12 and 18% compared with previous estimates. And this is at a time when Mexico's Category 1 status has been restored by the FAA and it really wants to further expand its network, particularly on some of those lucrative trans-border routes to the U.S.

Other airlines, there's IndiGo has been forced to suspend some domestic services because of limited aircraft availability. Lufthansa is also dropping some regional routes, Frankfurt to Bristol, Liverpool and Paris Orly will all be dropped in February, and that's because of engine issues has left it with fewer aircraft than previously planned. So I think as the year progresses, we're going to see the impact of those groundings on carriers and it's slightly going to result in airlines cutting routes and destinations from the networks, as well as potentially delaying the launch of new routes, and that's to cope with the capacity shortfall as aircraft remain grounded.

Karen Walker:

Right. So we weren't in a particularly good situation in terms of the supply chain in '23, in fact, a pretty poor situation in some respects. This incident just really adds to that pain and to the cost. Aaron, I mean, you and I have been covering this industry for a long while and I know that you're very familiar with Boeing, so I'd really welcome your thoughts here on this incident in particular and where things stand. This is a company with a very strong engineering reputation, and so that really makes it all the more shocking that first of all, you had the two MAX crashes, and now here we are again with something that could have been, this incident could have been a heck of a lot worse. We all know that. One of the things that strikes me is that Dave Calhoun came on as a CEO at Boeing after the MAX crashes and pledged to address so-called cultural issues and engineering types of issues at Boeing. We've now got a relatively new FAA administrator, Mike Whitaker, who is somebody who is very highly respected.

As we all know, the FAA was really delayed grounding the MAX even after that second crash, and long after other regulators around the world had grounded it. This time, FAA came in pretty quick and I quote Whitaker, he said, "It is time to reexamine the delegation of authority and assess any associated safety risks at Boeing." And what he's talking there, of course, is about how Boeing oversees not just its own production quality control, but those of its major suppliers that includes Spirit that makes that particular section. Aaron, what's your thoughts here on how did Boeing get into this and how serious is this for them?

Aaron Karp:

Well, I think as you and David mentioned, the manufacturing supply chain that builds parts for aircraft is stretched extremely thin. And the problem with fixing it is the issues and bottlenecks are widespread and pervasive. Yes, they're slowly getting better, but I would emphasize the word slowly. There are basic material problems that range from the type of equipment being manufactured to where the parts are being built, even raw materials. There are logistics problems with getting parts to Boeing when they need them. And then there are aviation and aviation manufacturing, like all aspects of aviation, has a labor shortage and inexperience issue. A lot of technicians, aviation technicians retired or left during the pandemic, and it's hard to rebuild that workforce. If you're Spirit AeroSystems, which supplied the door plug to Boeing for the MAX 9, you can't just hire someone and then have them out on the line the next day.

Training takes a while. And it's been pointed out to me that there is a certain amount of craftsmanship to building sophisticated aircraft parts, and that can take years for someone to get to. So a lot of the older, wiser heads that can be mentors are not there. You have a system that building aircraft that's highly stressed. Both Boeing and Airbus want to increase production, because demand for commercial aircraft is high, with passenger demand coming back. And the same sub-suppliers making parts for Boeing are also making parts for Airbus, business aircraft, military aircraft, helicopters, et cetera. Boeing CEO Dave Calhoun says that the supply chain needs stability and it needs a lack of surprises, and that's not there right now. And he has conceded that there's no short-term fix. He's expressed optimism that by the end of this year, things will start to look a little normal.

We still need to learn more about the Alaska incident, but missing things and quality control are the kinds of things I think you'd expect with such a strained system. Airlines ultimately suffer because, as David said, Boeing delivers the planes late or the planes get grounded. And of course, as you said, Karen, the MAX accidents linger in the background over all of this. So I think Boeing is struggling because the supply chain is just a mess. And I think everyone could see that it's not going to be fixed soon, and that means these problems of deliveries and groundings don't seem to be alleviating. And now you have the FAA, as you said, really, really, really focused on this, and so they're not going to hesitate to ground aircraft or put out safety alerts. I mean, I think they're going to be super vigilant now, and that is another issue Boeing will have to deal with.

Karen Walker:

So we've now got a situation where there's the NTSB investigation into that incident, of course, but FAA has also begun an audit of Boeing's MAX 9 production line and essentially oversight of its suppliers. So it's evaluating that, so people will need to know what the outcome of that. And then of course, Boeing has gone and appointed its own independent quality review leader, a retired U.S. Navy admiral. So we've got all of that going on. One of the things that occurs to me is if you're looking at this from a airline customer perspective, and again, even a leasing company that's also waiting for these airplanes to come in and get them out into service, what does that do to the trust, if you like, the customer trust, and could there be wider concerns about other things coming up on the 787 Dreamliner, the 777X? What do you think, Aaron?

Aaron Karp:

Yeah, I would say that the airlines have a lot of concerns right now. They'll talk about air traffic control problems, they'll talk about their own staffing shortages, but I think the most persistent complaint from airline CEOs and from network planners is the delivery delays and the grounding of aircraft. Spirit Airlines, based in Florida, has had numerous GTF A320s grounded, and they've said it's just made their network planning really difficult. And they call them, they say they refer to them as gliders, because they're just sitting on the ground without engines. And as you know, the only way a plane makes money is when it's in the air, and that's why airlines are so obsessed with quick turnarounds. And so I think there is persistent fear out there that out of nowhere, something like this could happen. You mentioned some of the airlines affected.

Copa Airlines in Panama, all of their long-haul routes into deep in South America are operated with the MAX 9. And so for them, they've put out statements saying we have no control over it. They've sort of thrown their hands up. But now their ability to fly, use their hub of Americas and fly to deep into South America and that sort of thing is affected. And so I think there's this persistent frustration both that this isn't alleviating, there's continuing delivery problems, continuing maintenance problems, continuing safety inspection problems, and that there are going to be surprises.

I mean, I think everyone is saying next week, we don't know what could happen. And so that lack of stability and that feeling of surprise when you're trying to plan a network three months out, six months out, nine months out, and you don't know if the planes are going to be there, sometimes you'll hear an airline say, "Well, we're going to start this route in three or four months with the caveat if the planes are delivered." And so I think the airlines are exasperated at this point, and with all the other issues they have coming out of the pandemic, this one seems to be something that's not easing up and is causing them all sorts of issues.

Karen Walker:

Absolutely. And I also still feel that airlines around the world will also be looking and thinking, "What else are we going to find out as these deeper inspections of Boeing comes and will that affect other aircraft?" Again, that's an entire unknown at the moment, but there must be that unease. And of course, essentially, it's a duopoly, isn't it? On the aircraft OEM side, there's Airbus and there's Boeing, so airlines are caught. They need Boeing to stay strong, be there. They don't want a monopoly, that's for sure. And Airbus can't supply all the other aircraft. They do need both of those manufacturers.

Christine, I'm just going to ask you a little bit from the passenger side. One of the things that struck me particularly here in the U.S. is that I would say more so than after the MAX crashes, I've seen a lot of headlines in the newspapers and stuff with things like headline, "How do I find out if my flight would be a MAX?" And they're not saying MAX 9, they're just using that term. There was a lot of questions after the crashes about whether the MAX name need to be dropped, et cetera, et cetera. What are your thoughts as you've been covering this? What are your thoughts about the passenger sense of trust now?

Christine Boynton:

Sure. So, I mean, I think the communication, particularly from Alaska, has been pretty transparent and pretty proactive. So I think that helps a little in rebuilding perhaps some trust with its passengers. At the same time, just as you mentioned from the headlines, I think this is the first time, just anecdotally, I've seen friends and family try to figure out how to see which kind of aircraft is serving the route they're flying on an upcoming trip. This past weekend, I flew from Logan to BWI on a Southwest MAX 8 and the aisle across from me, someone took out the aircraft information card from the seat back in front of them and started making comments to their companion. So I do think there is a certain level of trust that will have to be rebuilt, regardless of it being a separate aircraft, just in general.

Karen Walker:

Yeah...Interesting. You raised a point there. I've actually had people ask me, and they didn't ask before, but I'm getting people asking me saying, "Would you fly on a MAX?" I mean, I think there has to be an element of this, and part of it will depend of course on the full outcome of the investigations and audits. One thing I would just like to say before we wrap up is that there was another incident, of course, as well, a very recently, very drastic incident in Tokyo. A Japan Airlines A350, of course, crashed into an aircraft that it looks like it was in the wrong place on the taxiway, and a huge fire. And it was just incredible when you saw that the aircraft stayed together enough before everybody could get off and the orderly way that actually every single person got off.

And while those were two completely different instance, the common factor there both with Alaska and JAL, was the incredible work and professionalism of the pilots and the cabin crew. If there's a good part to take from these sorts of incidents, it's when you see that happen and lives being saved by the crews. So, bravo to them. David, Christine, and Aaron, thank you for the good conversation on a very important topic that is certainly going to be in the news for quite a bit of this year, I expect. And of course, thank you to our listeners. You can subscribe to us each week on Apple Podcasts or wherever you listen. Also, thank you to our producer, Cory Hitt, and until next week, this is Karen Walker, disembarking from Window Seat.