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Analysts question what Boeing gained from CEO’s press conference

Boeing chief executive Dennis Muilenburg’s public handling of the 737 Max crisis – particularly his comments at a recent press briefing – has left some industry observers questioning the prudence of the chief’s approach.

Questions have also arisen in the broader media about Muilenburg’s job security – though some analysts describe such speculation as unwarranted.

Several analysts interviewed agree the 737 Max’s problems make Muilenburg’s job incredibly difficult, and they suspect Boeing’s corporate lawyers – already facing legal attacks on several fronts – are driving his messages.

But the approach may be causing more harm than good, some say.

“They are talking like a company that’s lawyering up, rather than a company that plays some kind of role,” says Richard Aboulafia, an aerospace analyst and vice-president of consultancy Teal Group. “By not admitting that MCAS design and implementation is flawed, they are letting all sorts of nonsense to prosper out there.”

By “nonsense”, Aboulafia means suggestions swirling on social media and elsewhere that Boeing rushed the 737 Max’s development, and did so on the cheap.

“No one is hearing an alternative narrative from Boeing,” he adds.

Muilenburg’s “press conference, aside from his main speech, was not perceived as positive. He said things that were indeed correct, but it was not needed to further the issue,” aerospace analyst Michel Merluzeau says of Muilenburg’s 29 April appearance before reporters.

“Muilenburg raised issues worthy of discussion, such as whether the pilots correctly followed all checklist procedures, but it did not come across as intended,” Merluzeau adds.

During Muilenburg’s press briefing, held in Chicago immediately after the company’s annual shareholder meeting, reporters peppered Muilenburg with 737 Max questions.

Muilenburg’s responses walked a delicate line. He insisted Boeing has taken responsibility for improving the MCAS flight control software, which played a role in both accidents.

He also defended Boeing’s design work and, when pressed, did not answer when asked pointedly if Boeing designed a faulty system.

Muilenburg also said the pilots of two recent crashed 737 Max aircraft did not “completely” follow cockpit checklists.

Another analyst who spoke on condition of anonymity expressed surprise, even disbelief, at what this person viewed as Muilenburg’s failure to concede Boeing made errors with MCAS development.

Aboulafia credits Muilenburg for finally taking questions from reporters, but views Muilenburg’s comments as short-sighted and scripted by corporate attorneys.

Two days after the press conference, Boeing announced its former general counsel Michael Luttig had taken a new position to focus exclusively on advising Muilenburg and Boeing’s board on “special issues” such as those related to the 737 Max crashes.

“It just seems they are bowing down to short-term level concerns rather than doing what's best for the company in the long run,” says Aboulafia.

Boeing would benefit, Aboulafia thinks, by conceding the role it played, perhaps saying something like: “It wasn’t absolutely necessary, this system, but we inserted it and we made it more aggressive than it needed to be… We regret that, but in hindsight these are easy errors to fix”.

Such an approach might expose Boeing to greater legal risk.

“But it sure is worth it,” Aboulafia says. “It’s the right thing to do.”

Others think Boeing might have been better served to not hold a press conference at all until investigations into the two recent crashes are completed.

“I was surprised Dennis decided to step in the lion’s den,” Merluzeau says. “He had to know this was going to happen. Better not to have had a press conference, perhaps.”

Since the press conference, discussion has also swirled in the broader media about whether Boeing’s challenges might spur a change at the top, possibly leading Muilenburg to resign, or to be forced out.

Boeing declines to comment to FlightGlobal about Muilenburg's future as chief executive. A reporter asked Muilenburg on 29 April if he planned to step down, but Muilenburg did not answer.

In addition to the 737 Max crisis, two other major Boeing aircraft programmes have faced negative press in recent weeks. Boeing has halted deliveries of KC-46 tankers after reports that the US Air Force found production debris inside delivered aircraft. And recent news reports raised allegations of similar problems with 787s produced at Boeing’s North Charleston manufacturing site.

Boeing has defended the quality of North Charleston-produced 787s and says it is addressing KC-46 concerns.

Those challenges aside, Aboulafia thinks Muilenburg’s job remains secure – assuming Boeing gets the 737 Max back into service relatively quickly.

“This is a company driven by share price. As long as the company‘s share price goes up”, Muilenburg’s job is safe, Aboulafia says.

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