Boeing Co (NYSE:BA) ticked lower on Wednesday morning after a new congressional report condemned both Boeing and the Federal Aviation Administration for shortcomings that contributed to two deadly 737 Max crashes.
What Happened? The House Committee on Transportation and Infrastructure released a 238-page report that highlighted multiple mistakes by both Boeing and the FAA in the development and certification of the 737 Max.
According to the report, Boeing pressured employees to complete the 737 Max to compete with rival Airbus despite flaws in the plane’s design. At the same time, the report suggested the FAA delegated an “excessive” portion of the safety certification process to Boeing itself.
Why It’s Important: The 737 Max has been grounded since March 2019 following two crashes that killed a total of 346 people. The new report places blame on both Boeing and the FAA for the crashes.
“They were the horrific culmination of a series of faulty technical assumptions by Boeing’s engineers, a lack of transparency on the part of Boeing’s management, and grossly insufficient oversight by the FAA,” the report said.
In response to the report, the FAA said it “looks forward to working with the Committee to implement improvements identified in its report.”
Boeing also released a statement in which the company said it is dedicated to working to improve its process to keep passengers safe.
“Once the FAA and other regulators have determined the MAX can safely return to service, it will be one of the most thoroughly scrutinized aircraft in history, and we have full confidence in its safety,” Boeing said.
Benzinga’s Take: The key for Boeing investors moving forward is when exactly the 737 Max will be cleared for takeoff. In the meantime, the company is dealing with newly discovered flaws in some 787 Dreamliners that have delayed deliveries.
Photo by Steve Lynes via Wikimedia.