One year after Lion Air crash, Boeing 737 MAX remains grounded

The crisis has cost Boeing billions of dollars and spawned numerous investigations by US authorities, as well as lawsuits from victims’ families. (AFP)
Updated 30 October 2019

One year after Lion Air crash, Boeing 737 MAX remains grounded

  • The situation plunges the 103-year-old aerospace giant into the biggest crisis of its history

NEW YORK: On March 12, 2019, Dennis Muilenburg phoned US President Donald Trump for support after European and Chinese regulators grounded the Boeing 737 MAX following an Ethiopian Airlines crash that killed 157 people.

When Muilenburg hung up, the Boeing chief executive thought he had the backing of the US leader. But the next day, Trump announced that Boeing’s top-selling plane was “grounded effective immediately.”

Boeing’s entire global fleet of almost 400 MAX planes has stayed out of service ever since, plunging the 103-year-old aerospace giant into the biggest crisis of its history.

The situation has raised questions about Boeing’s commitment to safety and corporate culture while also tarnishing the company’s image as it continues to compete with archrival Airbus.

The crisis has cost Boeing billions of dollars and spawned numerous investigations by US authorities, as well as lawsuits from victims’ families.

The crisis actually began months earlier on October 29, 2018, when a MAX operated by Indonesian carrier Lion Air plunged into the Java Sea.

“Boeing blamed the pilots immediately in Lion Air, and then bungled the response thereafter,” said Scott Hamilton of Leeham News, an aviation publication.

“Boeing’s stubborn resistance to admit its mistakes — even as those mistakes have delayed the return to operation of 737 MAX planes — are turning this into a disaster for the company and its customers,” said Jim Hall, former chairman of the US National Transportation Safety Board (NTSB).

Indonesian investigators last week attributed the crash to nine factors, including inadequate pilot training and a poorly designed flight handling system known as the Maneuvering Characteristics Augmentation System (MCAS) that it said wasn’t properly certified by US regulators.

“These items were connected to each other. If one of them was not occurring on that day, the accident may not have happened,” said Nurcahyo Utomo, an investigator with Indonesia’s National Transportation Safety Committee.

If the investigation showed Lion Air’s pilots to be young and untested, it also revealed them to be in the dark about the MCAS, which was not mentioned in Boeing’s flight manual.

The system has also been implicated in the Ethiopian Airlines crash.

The MCAS was developed specifically for the MAX to guard against stalling that could be caused by the plane’s heavier engines.

The system was activated shortly after takeoff in both flights based on an incorrect sensor reading. The error stemmed from an angle of attack sensor that was approved for service by Xtra Aerospace, a Florida company that had its repair station certificate revoked by the FAA last week.

The pilots in two crashes were unable to regain control of the plane from MCAS, in part because the system was designed with no redundancy to that single sensor.

A report last month from the NTSB said Boeing and the FAA misjudged how pilots would respond to multiple alerts and alarms as they encountered trouble when flying the 737 MAX.

Another report earlier this month from a panel of global regulators concluded the FAA lacked the manpower and expertise to evaluate the MCAS.

A few days after the Lion Air crash, the FAA sent a directive to MAX operators about the risk of a faulty angle of attack sensor while Boeing developed an upgrade to the MCAS.

However, Boeing was still working on the correction at the time of the Ethiopian Airlines crash five months later.


Egypt’s sovereign wealth fund to raise authorized capital five-fold up to $62.15 billion

Updated 12 November 2019

Egypt’s sovereign wealth fund to raise authorized capital five-fold up to $62.15 billion

  • Egypt’s parliament passed a law allotting 5 billion Egyptian pounds of start-up capital for the fund last year
  • Abdel-Fattah El-Sisi: Egypt could dramatically expand the size of its new sovereign wealth fund to ‘more than several trillion pounds’

CAIRO: Egypt’s sovereign wealth fund is expected to increase its authorized capital to up to a trillion Egyptian pounds ($62.15 billion) from 200 billion pounds within three years, depending on investors’ appetite, the fund’s executive director said.
Last year, Egypt’s parliament passed a law allotting 5 billion Egyptian pounds of start-up capital for the fund, called the Egypt Fund, with 1 billion pounds to be transferred immediately from the treasury.
The law also allows the president, who picks the board of directors, to transfer the ownership of any unused state assists to the fund or to any of the fund’s assists or companies.
“We expect to increase our licensed capital within three years to a trillion pounds or less ... it all depends on the investors’ response and investment appetite,” said Ayman Soliman, the fund’s chief executive.
“The sectors we will work in include industry, traditional and renewable energy, tourism and archaeology,” Soliman said.
President Abdel-Fattah El-Sisi said last month that Egypt could dramatically expand the size of its new sovereign wealth fund to “more than several trillion pounds,” and that it “aims to contribute to sustainable economic development through management of its funds and assets.”
The fund plans to buy a stake of about 30 percent in power plants built by Siemens, Soliman said, adding that six international investors have expressed interest.
“So far, six companies submitted offers to the Electricity Holding company to buy shares in the Siemens power plant,” Soliman said.
The plants, billed at the time as the world’s biggest, were built by Siemens in a €6 billion ($6.61 billion) deal signed in 2015. El-Sisi inaugurated them last year.
In May, Electricity Minister Mohamed Shaker said that the government is considering selling the power plants to private investors, but talks were still at an early stage.