Boeing crisis grows as 737 Max blocked from Singapore, Australia

SINGAPORE • Boeing Co is facing a growing crisis of confidence over its 737 Max jet, as airlines and regulators from Singapore to Australia move to ground or block the plane following two deadly crashes in five months.

A day after US regulators stood by the jet’s airworthiness, airlines and aviation authorities in South America and Asia are instead opting for a zero-risk approach. Australia followed Singapore in temporarily barring the 737 Max from its airspace, meaning the newest version of Boeing’s best-selling model is now blocked from a key long-distance travel destination as well as Changi, Asia’s second-busiest international airport and a popular transit hub.

The Civil Aviation Authority of Singapore barred any Boeing 737 Max flight in and out of the city-state, dragging airlines including Singapore Airlines Ltd’s SilkAir, China Southern Airlines Co, PT Garuda Indonesia and Shandong Airlines Co into a standoff with the Chicago-based planemaker and the US regulator. While no Australian airlines operate the 737 Max, two foreign carriers currently fly them into the country, its aviation watchdog said.

The similarities between Sunday’s crash of an Ethiopian Airlines jet and the Lion Air disaster in October in Indonesia — both involving the Boeing 737 Max 8 aircraft — have spooked travellers and sparked worries that the jet is fatally flawed.

Despite the US Federal Aviation Administration’s (FAA) verdict that the plane remains safe to fly, Boeing has been hit with a wave of 737 Max groundings that could potentially snowball into lost aircraft sales. Lion Air is said to be considering a switch to Airbus SE planes, a person familiar with the discussions said, with the carrier suspending further 737 Max deliveries this year.

Singapore’s aviation regulator will “gather more information and review the safety risk associated with the continued operation of the Boeing 737 Max aircraft into and out of Singapore”, according to a statement.

Changi Airport declined to comment on the potential impact of the move, saying carriers will likely use spare aircraft or switch planes around to make up for the loss of the 737 Max. Flights to Changi on 737 Max aircraft accounted for 2% of seat capacity this year, said Rahul Kapoor, an analyst at Bloomberg Intelligence, citing data from FlightGlobal.

SilkAir, which runs six 737 Max, said the blockade will have an effect on its flight schedules, while Shandong Airlines cancelled a flight to Singapore yesterday from the Chinese city of Jinan, according to Changi.

China was the first aviation market to move on the 737 Max following the Ethiopian Airlines crash, which killed all 157 people on board the flight from Addis Ababa to Nairobi, Kenya. The regulator grounded all 96 of China’s 737 Max planes early on Monday until their safety can be assured.

A swathe of airlines and aviation markets followed suit, with South Korea’s Eastar Jet Co announcing the suspension of its two 737 Max 8 planes yesterday. It followed Max jet groundings by low-cost Brazilian carrier Gol Linhas Aereas Inteligentes SA and Grupo Aeromexico SAB. Hours earlier, the Mexican carrier had said its Max aircraft were in perfect condition.

The spreading cautionary moves are a reaction to the two deadly catastrophes that have eroded faith in the world’s most widely flown jetliner, even after the FAA said there isn’t conclusive evidence so far to link the crashes. Boeing shares fell more than 2.5% on Germany’s Tradegate exchange as of 9:55am local time yesterday, after its US stock ended on Monday down 5.3%. — Bloomberg