Boeing CEO on 737 crash: “We created the problem”

(CNN) — Boeing CEO Dave Calhoun said the company is responsible for an incident in which a 737 Max 9 door flap blew off during a flight earlier this month, and he said Boeing should have done a better job than it did in that case. should do.

“We created the problem and we understand it,” he told investors during a call after the company reported its latest quarterly loss. “Whatever the findings, Boeing is responsible for what happened. Whatever the specific cause of the accident, this type of incident should not happen on an airplane coming out of one of our factories. We just need to be on top of that.”

Boeing did not provide the financial guidance it typically gives investors, nor say when it would deliver two new versions of the 737 Max that it has promised to airlines but which have not yet been approved by the Federal Aviation Administration (FAA). Has not been certified by. ,

“Although we often use this time of year to share or update our financial and operational goals, now is not the time for that,” Calhoun said in comments to Boeing employees released by the company.

The January 5 incident in which a door plug broke on an Alaska Airlines flight has once again put the company on the defensive. Fortunately, no one died, as the crew was able to make an emergency landing within minutes of the hole opening, but the short flight terrified passengers, who saw their cell phones and laptops torn from the plane. This led to the grounding of Boeing 737 Max 9 models for three weeks as inspections revealed problems with the installation of other door plugs.

“I have had tough, direct conversations with our customers, regulators and legislators,” he said. “They are disappointed and we have a lot to prove to earn the trust of our shareholders.”

Calhoun’s comments came as the manufacturer reported another loss for 2023, without providing a financial outlook for 2024 that includes expectations of Federal Aviation Administration approval for two new versions of the plane, the 737 MAX 10, longer, and the 737 MAX 7. Were involved. Small.

In the wake of the door plug incident, the FAA said it would not allow the company to proceed with a planned increase in production of existing models. And two major customers, United Airlines and Southwest Airlines, said last week they were indefinitely delaying delivery plans for both models.

“Our people at the factory know better than anyone what we need to do to improve,” Calhoun said. “We will move slow, we will not rush the system and we will take our time to get it right.”

“More scrutiny, whether from us, our regulator or others, will make us better,” he said.

In an interview Wednesday on CNBC, Calhoun said he would not speculate on what the National Transportation Safety Board, which is investigating the incident, would define as the cause of the incident. But he said he is “confident” that the (door) plug is “completely under control.”

He also defended the company’s decision not to provide new financial guidance.

“Our entire focus, our entire focus as a company is to make sure we never have a safety (incident) again, learn everything we can from the accident, learn everything we can from the FAA audit.” Learn everything we can, learn everything we can from the ideas that our own people have given us,” he said.

When asked if Boeing had lost the trust of its airline customers, he said that customers have so far told the company that they will remain with Boeing.

He said, “Did it hurt them? Absolutely. As I said, these moments shake all of us to our core: Boeing, our people, our customers, everybody.” “Our job is to restore confidence at all levels. They want Boeing to win. They want us to succeed.”

The good news for the troubled company is that Boeing reported an adjusted loss of 47 cents per share, or about $285 million, in the fourth quarter, much better than the loss of $1.75 per share. The stock and losses last year were estimated at 78 cents a share, estimated by analysts surveyed by Refinitiv.

Not only has the company posted losses in every quarter except one since the end of 2019, but it has almost always posted larger-than-expected losses.

Shares of Boeing, which have lost about 20% of their value since the Alaska Airlines incident, rose slightly in premarket trading Wednesday on Calhoun’s comments and the quarterly report.