FAA Finds Boeing Fails Quality-Control Standards

Terry Bingman
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FAA Audit of Boeing and Supplier Finds Multiple Instances of Non-Compliance

The Federal Aviation Administration (FAA) announced on Monday that its audit of Boeing and its key supplier, Spirit AeroSystems, revealed “multiple instances” of non-compliance with manufacturing quality standards for the 737 Max aircraft. The audit uncovered issues related to Boeing’s manufacturing-process control, as well as parts handling and storage.

The FAA did not provide specific details of the non-compliance issues but stated that it has shared a summary of findings from its six-week audit with Boeing and Spirit AeroSystems. However, the summary has not been made public as the FAA’s investigation into Boeing is still ongoing.

In response to the audit findings, a spokesperson for Spirit AeroSystems, Joe Buccino, stated that the company welcomes the FAA’s audit and will be reviewing the findings. He also mentioned that they are in communication with Boeing and the FAA to determine appropriate corrective actions.

Boeing, on the other hand, referred to a statement made by CEO David Calhoun last week, where he expressed the company’s commitment to addressing the issues. Calhoun stated that Boeing now has a “clear picture of what needs to be done” and is fully dedicated to meeting this challenge.

The FAA has been increasing its scrutiny of Boeing following an incident on January 5, when a panel detached from a Boeing 737 Max 9 aircraft while flying over Oregon. Despite the incident, the pilots of the Alaska Airlines jet were able to safely land the plane.

Since then, Boeing has replaced the executive in charge of the 737 Max program, and last week, the FAA gave the company a 90-day deadline to develop a plan for addressing safety concerns raised by both the FAA and an independent panel of experts from industry, government, and academia.

Analyst comment

Negative news. The FAA audit revealing non-compliance with manufacturing quality standards for the 737 Max raises concerns about Boeing’s processes and parts handling. Market may see a decline in Boeing’s stock value as the company faces potential fines and corrective actions to address safety concerns.

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Terry Bingman is a financial analyst and writer with over 20 years of experience in the finance industry. A graduate of Harvard Business School, Terry specializes in market analysis, investment strategies, and economic trends. His work has been featured in leading financial publications such as The Financial Times, Bloomberg, and CNBC. Terry’s articles are celebrated for their rigorous research, clear presentation, and actionable insights, providing readers with reliable financial advice. He keeps abreast of the latest developments in finance by regularly attending industry conferences and participating in professional workshops. With a reputation for expertise, authoritativeness, and trustworthiness, Terry Bingman continues to deliver high-quality content that aids individuals and businesses in making informed financial decisions.