MAB still reviewing RM23b Boeing 737 Max orders

It is not known whether the agreement between MAB and Boeing provides for cancellation or swap options

by RAHIMI YUNUS / pic by BLOOMBERG

MALAYSIA Airlines Bhd (MAB) is still reviewing the RM23 billion purchase of Boeing Co’s 737 Max as the aircraft maker grabbles to address the engineering and financial fallout of its marquee jetliner.

The US planemaker was dealt a fresh blow after revelations of embarrassing communications among employees who questioned the 737 Max’s airworthiness during the development stage.

Boeing submitted over 100 pages of documents to investigators comprising staff emails and instant messages, which unveiled that employees labelled the aircraft manufacturer’s bestseller as “designed by clowns…supervised by monkeys”.

The documents also showed the company’s attempts to deceive the US Federal Aviation Administration (FAA) and airlines over the safety of the plane.

The 737 Max has been grounded since March last year after two fatal air crashes involving Lion Air flight 610 and Ethiopian Airlines flight 302, killing 346 people on board.

Last week, Boeing recommended that pilots undergo flight simulator training to fly the 737 Max, reversing its previous stance that a computer training would suffice.

MAB said the company’s focus is on safety and it is reviewing the acquisition amid more uncertainties over the possible return to service of the 737 Max.

“Safety is of utmost importance to MAB and we are currently reviewing our B737 Max order while anticipating a decision by the FAA and other global aviation regulators that will determine when the 737 Max will return to service,” the airline told The Malaysian Reserve (TMR) recently.

Carriers are left in limbo on when the aircraft can resume operation. Losses are piling as airlines have to readjust their business model.

MAB ordered 25 737 Max’s with another 25 purchase rights in a deal valued at US$5.5 billion (RM23 billion).

The first delivery had been slated for July 2020. In August last year, MAB group CEO Captain Izham Ismail said talks with the Seattle-based planemaker were ongoing.

“We are still in discussion for options with Boeing on Max 8. It is a long process,” Izham previously told TMR.

It is not known whether the agreement between MAB and Boeing provides for cancellation or swap options. No Malaysian carriers operate the 737 Max.

“MAB continues to be a valued customer and we are sorry for the disruption this situation has caused them.

“We are focused on earning their trust and supporting all of our customers around the world in every way possible to ensure complete confidence in the 737 Max and a safe return to commercial flight,” a Boeing spokesperson previously said to TMR.

The International Air Transport Association (IATA) said safety regulators worldwide need to work together to reinstate public trust in the industry’s aircraft certification.

“The key thing is to restore public confidence in the industry’s aircraft certification and validation processes when the aircraft returns to service, and that requires a harmonised approach among regulators,” IATA corporate communications assistant director (regional office for Asia and Pacific) Albert Tjoeng told TMR.

Boeing had suffered over US$4 billion in losses related to the global grounding of the 737 Max, while it is working around the clock to find a solution to all the technical flaws.