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Emergency Order: Trump Grounds Boeing MAX Airplanes

Summary:
Following 2 recent crashes of Boeing's newest aircraft, countries started banning flights. Today, the US followed. Ethiopian Airlines Flight 302 crashed on March 10, 2019, killing all 157 on board. Lion Air Flight 610 from Indonesia crashed into the Java Sea on Oct. 29, 2018 killing 189 people. Both planes crashed shortly after takeoff. The EU, UK, Mexico, Canada, Australia, Bermuda, Cayman Islands, Ethiopia, Fiji, Hong Kong, India, Norway, New Zealand, Russia, Singapore, Switzerland, Turkey, Vietnam, and a number of smaller countries all banned 737 MAX 9 and/or 737 MAX 8 aircraft. Not only did those countries ban their use, most of them will not even allow flyovers. T Trump Grounds all Boeing 737 MAX Planes As I was typing this article, I had to start over. In remarks at the White

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Following 2 recent crashes of Boeing's newest aircraft, countries started banning flights. Today, the US followed.

Ethiopian Airlines Flight 302 crashed on March 10, 2019, killing all 157 on board. Lion Air Flight 610 from Indonesia crashed into the Java Sea on Oct. 29, 2018 killing 189 people. Both planes crashed shortly after takeoff.

The EU, UK, Mexico, Canada, Australia, Bermuda, Cayman Islands, Ethiopia, Fiji, Hong Kong, India, Norway, New Zealand, Russia, Singapore, Switzerland, Turkey, Vietnam, and a number of smaller countries all banned 737 MAX 9 and/or 737 MAX 8 aircraft.

Not only did those countries ban their use, most of them will not even allow flyovers. T

Trump Grounds all Boeing 737 MAX Planes

As I was typing this article, I had to start over.

In remarks at the White House, Mr. Trump called Boeing an “incredible company” and said it is that is working hard to find the cause of the crash of an Ethiopian Airlines flight. Mr. Trump said until the cause is determined, “the planes are grounded” He added: “All of those planes are grounded effective immediately.”

Earlier, Canada’s transport minister said Wednesday that satellite-tracking data indicated “a possible, although unproven, similarity” between the Ethiopian Airlines jet that crashed last weekend and an October crash involving the same type of Boeing Co. 737 MAX aircraft, the first time a regulator has cited data suggesting a potential link between the problems that doomed the two jetliners.

The pilot of the Ethiopian Airlines jet that crashed Sunday reported that he was having flight-control problems and wanted to return to the airport, but didn’t indicate any other technical faults or other difficulties during the jet’s short ascent, according to the carrier’s chief executive.

The general similarities between the two crashes—both involved brand new MAX 8s that went down shortly after takeoff—have prompted increased scrutiny of the jet. Mr. Gebremariam, the Ethiopian Airlines CEO, said those black boxes would be sent to Europe for analysis, although a final determination as to which country hasn’t been made.

Norwegian Air Shuttle ASA, one of the biggest 737 MAX customers, with 110 on order, said Wednesday it expects Boeing to compensate it for the financial impact of the suspension. Norwegian Air has had to cancel 19 flights, including trans-Atlantic services to the U.S. that use the 737 MAX 8. Norwegian grounded its 18 737 MAX 8 aircraft Tuesday.

While bigger airlines, with large fleets, have more flexibility to swap out aircraft, smaller carriers are more limited. Compensation from equipment makers for such service disruptions are common in the industry.

Bernstein Research analyst Daniel Roeska said Norwegian may lose as much as $46,000 per 737 MAX a day because of the groundings.

New Software Controversy

At the heart of the controversy is new software.

Following the Lion Air crash, observers and pilots suggested that new software may be to blame, prompting the Federal Aviation Administration to issue a directive requiring American air carriers to update their flight manuals accordingly so pilots would be made aware of the issue. Questions regarding the aircraft and its software were raised again following Sunday’s crash of Ethiopian Airlines Flight 302.

The consumer advocacy organization FlyersRights.org called on the Federal Aviation Administration to ground the Boeing 737 Max 8 aircraft, arguing that the FAA should re-certify the plane as airworthy before it flies again.

"The FAA’s ‘wait and see’ attitude risks lives as well as the safety reputation of the U.S. aviation industry," said Paul Hudson, president of FlyersRights.org

Former managing director of the National Transportation Safety Board Peter Goelz meanwhile told CNN that he wasn’t sure if he would let his family fly on a 737 Max aircraft. “

Emergence Order

Boeing Asked Trump to Not Ground the Planes

Profits First!

Too Complex To Fly

Yesterday, Trump made a pair on incredibly silly Tweets.

Automation Improves Safety

Trump's Tweets are obviously silly, so lets look for supporting data.

According to Boeing, close to 80 percent of commercial airline accidents are caused by pilot error. Automation of airplanes has correlated with more safety, not less

According to data compiled each year by the Aviation Safety Network (ASN), the number of international commercial airline accidents has been steadily declining for the past 45 years, down to 18 last year from 73 in 1972.

Commercial Airline Deaths

Zero Deaths

While we may not want Einstein himself flying planes, it's clear that software designed by airline Einsteins has been a huge boon to safety.

Trump will bend, to the point of absurdity, any bit of news that fosters his ego or goals.

I'm not sure which of those comes first.

That said, I believe grounding the planes was justified. But note the US followed, it did not lead this effort.

Mike "Mish" Shedlock

Mike Shedlock
Mike Shedlock (Mish) is a registered investment advisor representative for SitkaPacific Capital Management (http://www.sitkapacific.com/). Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

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