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How much will it cost to Boeing suspending its 737 MAX?

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Several models of aircraft have been disabled by authorities and airlines after concerns about their safety: now it is the turn of the 737 Max 8

How much will it cost to Boeing suspending its 737 MAX?

After the accident of the flight of Ethiopian Airlines, several airlines and European aviation authorities have decided to suspend the use of the Boeing 737 Max 8 aircraft. This misfortune last Sunday, March 10, which caused the death of 157 people on board, is the second accident of this model in six months.

Leer en español: ¿Cuánto le costará a Boeing la suspensión de su 737 MAX?

This suspension, according to the New York Times, occurs when a relevant safety regulator, such as the Federal Aviation Administration (FAA) of the United States or the European Aviation Safety Agency, cancels the navigability certificate for a certain type of aircraft.

This means that the models cannot be used under that jurisdiction, as well as other jurisdictions that have accepted the authority of these regulators.

This type of suspension occurs for different reasons and, in this case, is due to the lack of safety that this model 737 Max 8 has shown in recent years. Airlines and regulators want to wait for the proper inspections and arrangements to be made to the aircraft.

Boeing receives the financial blow

CNN showed that Boeing shares have fallen 11% during the last week. However, according to estimates by Wall Street firms such as Melius Research and Jefferies, the cost of this suspension is $ 1 to $ 5 billion. These predictions were made with previous suspensions of three months.

They also clarify that Boeing can afford this cost since it published its record revenue of $101 million last year and a profit of $ 10.6 billion. They had expected stronger results for this year.

Now, Norwegian Air is seeking compensation from Boeing for 737 Max 8. This is the first airline to say publicly that it will sue Boeing for lost flight time and it is expected that others will also follow suit.

American Airlines (AA) and Southwest didn't want to suspend the plane along with the others, because they had full confidence in the model. However, the BBC announced that on Wednesday, March 13, President Trump took out an emergency measure to immediately suspend all Boeing 737 Max, until the company arrives with a solution. AA has 24 of these aircraft, which are affected by the suspension.

Also read: The Airbus A380: why did it lose the war against Boeing?

About six months ago, there was also a Lion Air accident in Indonesia with this same Boeing. Flight 610 had a fault in the automatic safety system with which the pilots could not fight and ended with the lives of 189 people. Apparently, the system was responding to erroneous data that suggested that the nose of the plane was tilted at a greater angle than it was, causing it to descend repeatedly.

Boeing clarified that he was "deeply saddened" with the loss of Lion Air but that he assured that this 737 MAX 8 is as safe as any other plane and that he would be taking all measures to understand all aspects of the accident.

It is not an atypical case

This is not the first time that a case like this occurs. Throughout history, several aircraft models have had to suspend their use due to technical problems and incidents.

Business Insider posted a brief history of aircraft that have been suspended by the FAA and individual airlines:

In 1979, for example, the DC-10 model of Boeing was suspended after having an accident in Chicago, compromising the lives of 271 people. The suspension lasted a month.

In 2008, American Airlines disabled its MD-80 (McDonnell Douglas) aircraft to fix the wiring. In 2011, Qantas suspended its A380 from Airbus for a month after a mid-engine engine explosion

One of the best-known cases is the Boeing 787 Dreamliner. Several of these airplanes presented failures in their batteries since several were ignited in a fire. According to information from Forbes, this model was suspended for four months by the Federal Aviation Administration after the malfunction in two planes operated by Japan in 2013, with only two weeks apart.

With this model, Boeing disabled an entire fleet of these aircraft. By then, only 50 of these aircraft were in service and, according to Boeing, the costs were 'minimal'.

Forbes also clarified that, when asked if they would be providing a list of battery failures since they resumed their flights, after their first initial suspension, they replied that "the approximately six hundred 787 Dreamliners currently in service have flown more than 2.7 billion miles of income", in 2017.

 

LatinAmerican Post | Valentina Moya

Translated from "¿Cuánto le costará a Boeing la suspensión de su 787 Max?"

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