Boeing
Boeing accepts plea deal to avoid criminal trial over 737 Max crashes
Boeing will plead guilty to a criminal fraud charge stemming from two crashes of 737 Max jetliners that killed 346 people after the government determined the company violated an agreement that had protected it from prosecution for more than three years, the Justice Department said Sunday night.
Federal prosecutors gave Boeing the choice last week of entering a guilty plea and paying a fine as part of its sentence or facing a trial on the felony criminal charge of conspiracy to defraud the United States.
Prosecutors accused the American aerospace giant of deceiving regulators who approved the airplane and pilot-training requirements for it.
The plea deal, which still must receive the approval of a federal judge to take effect, calls for Boeing to pay an additional $243.6 million fine. That was the same amount it paid under the 2021 settlement that the Justice Department said the company breached. An independent monitor would be named to oversee Boeing's safety and quality procedures for three years. The deal also requires Boeing to invest at least $455 million in its compliance and safety programs.
The plea deal covers only wrongdoing by Boeing before the crashes, which killed all 346 passengers and crew members aboard two new Max jets. It does not give Boeing immunity for other incidents, including a panel that blew off a Max jetliner during an Alaska Airlines flight in January, a Justice Department official said.
The deal also does not cover any current or former Boeing officials, only the corporation. In a statement, Boeing confirmed it had reached the deal with the Justice Department but had no further comment.
In a court filing Sunday night, the Justice Department said it expected to file the written plea agreement with the court by July 19. Lawyers for some of the relatives of those who died in the two crashes have said they will ask the judge to reject the agreement.
“This sweetheart deal fails to recognize that because of Boeing’s conspiracy, 346 people died. Through crafty lawyering between Boeing and DOJ, the deadly consequences of Boeing’s crime are being hidden,” said Paul Cassell, a lawyer for some of the families.
Federal prosecutors alleged Boeing committed conspiracy to defraud the government by misleading regulators about a flight-control system that was implicated in the crashes, which took place in Indonesia in October 2018 and in Ethiopia less five months later.
As part of the January 2021 settlement, the Justice Department said it would not prosecute Boeing on the charge if the company complied with certain conditions for three years. Prosecutors last month alleged Boeing had breached the terms of that agreement.
The company’s guilty plea will be entered in U.S. District Court in Texas. The judge overseeing the case, who has criticized what he called “Boeing’s egregious criminal conduct,” could accept the plea and the sentence that prosecutors offered with it or he could reject the agreement, likely leading to new negotiations between the Justice Department and Boeing.
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Relatives of the people who died in the crashes were briefed on the plea offer a week ago and at the time said they would ask the judge to reject it.
U.S. agencies can use a criminal conviction as grounds to exclude companies from doing business with the government for a set amount of time. Boeing is an important contractor of the Defense Department and NASA.
The case goes back to the crashes in Indonesia and in Ethiopia. The Lion Air pilots in the first crash did not know about flight-control software that could push the nose of the plane down without their input. The pilots for Ethiopian Airlines knew about it but were unable to control the plane when the software activated based on information from a faulty sensor.
The Justice Department charged Boeing in 2021 with deceiving FAA regulators about the software, which did not exist in older 737s, and about how much training pilots would need to fly the plane safely. The department agreed not to prosecute Boeing at the time, however, if the company paid a $2.5 billion settlement, including the $243.6 million fine, and took steps to comply with anti-fraud laws for three years.
Boeing, which blamed two low-level employees for misleading the regulators, tried to put the crashes behind it. After grounding Max jets for 20 months, regulators let them fly again after the Boeing reduced the power of the flight software. Max jets logged thousands of safe flights and orders from airlines picked up, increasing to about 750 in 2021, about 700 more in 2022 and nearly 1,000 in 2023.
The company based in Arlington, Virginia, has dozens of airline customers spanning the globe. The best customers for the 737 Max include Southwest, United, American, Alaska, Ryanair and flydubai.
That changed in January, when a panel covering an unused emergency exit blew off a Max during the Alaska Airlines flight over Oregon.
Pilots landed the 737 Max safely and no one was seriously injured, but the incident led to closer scrutiny of the company. The Justice Department opened a new investigation, the FBI told passengers on the Alaska plane that they might be victims of a crime and the FAA said it was stepping up oversight of Boeing.
A criminal conviction could jeopardize Boeing’s status as a federal contractor, according to some legal experts. The plea announced Sunday does not address that question, leaving it to each government agency whether to bar Boeing.
The Air Force cited “compelling national interest” in letting Boeing continue competing for contracts after the company paid a $615 million fine in 2006 to settle criminal and civil charges, including that it used information stolen from a rival to win a space-launch contract.
The company has 170,000 employees and 37% of its revenue last year came from U.S. government contracts. Most of it was defense work, including military sales that Washington arranged for other countries.
Even some Boeing critics have worried about crippling a key defense contractor.
“We want Boeing to succeed,” Richard Blumenthal, a Connecticut Democrat, said during a Senate hearing last month on what he termed the company’s broken safety culture. “Boeing needs to succeed for the sake of the jobs it provides, for the sake of local economies it supports, for the sake of the American traveling public, for the sake of our military.”
Relatives of the Indonesia and Ethiopia crash victims have pushed for a criminal trial that might illuminate what people inside Boeing knew about deceiving the FAA. They also wanted the Justice Department to prosecute top Boeing officials, not just the company.
“Boeing has paid fines many a time, and it doesn’t seem to make any change,” said Ike Riffel of Redding, California, whose sons Melvin and Bennett died in the Ethiopian Airlines crash. “When people start going to prison, that’s when you are going to see a change.”
Read more: A military training plane crashes in central Turkey, killing its 2 pilots
At a recent Senate hearing, Boeing CEO David Calhoun defended the company’s safety record after turning and apologizing to Max crash victims’ relatives seated in the rows behind him “for the grief that we have caused.”
Hours before the hearing, the Senate investigations subcommittee released a 204-page report with new allegations from a whistleblower who said he worried that defective parts could be going into 737s. The whistleblower was the latest in a string of current and former Boeing employees who have raised safety concerns about the company and claimed they faced retaliation as a result.
4 months ago
Considering Airbus’s offer of passenger planes seriously, Biman’s outgoing MD says
Biman Bangladesh Airlines could be expanding its fleet with new aircraft from Airbus. Outgoing Managing Director and CEO of the national flag carrier, Shafiul Azim, made the indication during a views exchange meeting with the Aviation and Tourism Journalists’ Forum of Bangladesh (ATJFB) today (May 29, 2024).
The meeting, held in Dhaka, saw the participation of ATJFB members led by their president, Tanzim Anwar. Addressing the forum, the outgoing Biman MD said that Airbus had proposed two offers to Biman for aircraft procurement.
“Initially, Airbus offered us two cargo planes, but we decided we do not need them at the moment. Instead, we expressed our interest in expanding our passenger fleet. Subsequently, Airbus proposed four passenger aircraft, which was a better offer. This proposal has been evaluated by the committee and forwarded to the board for approval,” Azim explained.
He emphasized the importance of diversifying their fleet, noting that currently, 16 out of 21 large aircraft in Biman’s fleet are from Boeing. “We are considering Airbus’s offers seriously. Diversifying our aircraft will not only mitigate risk but also appeal to passengers who appreciate newer models,” Azim said.
Airbus leading in Bangladesh’s aircraft purchase consideration over Boeing?
Regarding Boeing, Azim mentioned that they also received an offer from Boeing, which will be evaluated. “We have a longstanding relationship with Boeing, not just in terms of aircraft procurement but also their technical support and credit facilities. We are working well together,” he added.
Azim highlighted Biman’s advantageous position due to the competitive proposals from both Airbus and Boeing. He assured that regardless of the manufacturer chosen, Biman stands to benefit as a customer.
When asked about the financial status of Biman, Azim confidently stated that Biman has been “profitable for eight out of the last ten years.” The two years of losses included one year heavily impacted by the COVID-19 pandemic and another due to significant payment obligations. “Despite challenges such as dollar shortages and ongoing global conflicts, we have remained profitable,” the Biman MD said.
He further defended Biman’s financial health, pointing out that regular audits have confirmed their profitability. “We continue to hire, pay salaries and bonuses, including profit bonuses. If Biman wasn’t profitable, where would this money come from? To those who doubt our success, I pray they find guidance,” he remarked.
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Reflecting on his tenure, Azim expressed satisfaction with his management approach. “During my time, I never hesitated to reward deserving employees or to impose necessary disciplinary actions. I have used my authority to the fullest and believe that with effort, Biman can compete with the world’s leading airlines,” he stated.
Addressing the frequent changes in Biman’s leadership, Azim underscored the need for a stable management system. “Our human and technical resources are competent. If systems and structures are in place, the organization won’t rely on any single individual. I have focused on establishing these systems,” he noted.
He also recommended retaining experienced personnel in technical fields, regardless of age, as experience grows with time. “Biman should not function with the mindset of a government office; it is a commercial entity and should be managed commercially,” Azim advised.
He expressed a slight regret, wishing that four new aircraft could have been added to Biman’s fleet during his tenure.
Read more: Jahidul Islam Bhuiyan appointed as MD of Biman
On May 26, the Ministry of Public Administration announced Md. Jahidul Islam Bhuiyan as the new Managing Director and CEO of Biman Bangladesh Airlines. In a separate announcement, Shafiul Azim was promoted to Secretary of the Election Commission.
5 months ago
Boeing predicts air travel in Bangladesh will double in next 10 years
US aircraft manufacturer giant Boeing has predicted that air travel in Bangladesh will double in the next decade – driven by the country’s growing population, expanding economy and the middleclass.
Boeing provided details about the increasing demand and capacity for air travel in Bangladesh in a briefing today in Dhaka, on its Commercial Market Outlook (CMO), a yearly forecast of global and regional demand for aircraft.
Through 2032, Bangladesh is expected to achieve an annual economic growth rate of more than 5% -- double the global average, supporting air traffic growth at nearly 8.5% annually, according to Boeing.
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“As travel restrictions were relaxed over the past year, capacity growth in Bangladesh has increased by 11% year-over-year,” said Dave Schulte, Boeing Commercial Marketing Managing Director for Asia Pacific and India, on Wednesday (May 10, 2023).
Led by regional traffic to the Middle East and India, Bangladesh’s air travel could double over the next 10 years, he said.
To meet strong demands in passenger travel and air cargo, Boeing anticipates South Asia’s carriers will need more than 2,300 new commercial airplanes over the next 20 years, more than tripling South Asia’s current in-service fleet of 700 airplanes.
Read: US-Bangla Airlines to operate Boeing 737 Max 8
“We see tremendous opportunity in South Asia, with more than 80% of new deliveries supporting air travel growth and 20% replacing older, less fuel-efficient airplanes,” said Schulte.
Single-aisle airplanes like the Boeing 737 family will make up nearly 90% of South Asia’s future fleet, while 10% of the regional fleet will be widebody airplanes like the Boeing 787 Dreamliner. Both airplane models are currently in operation with Biman Bangladesh Airlines and US-Bangla Airlines.
“Boeing airplanes have played a tremendous role in the rapid growth of commercial aviation in Bangladesh. Commonality across the fleet will continue to play a major role in furthering growth, especially as it enables our airline customers to reduce operating costs and expenditures associated with training and maintenance,” added the Boeing Commercial Marketing Managing Director for Asia Pacific and India.
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1 year ago
Collision between aircraft: 5 Biman officials, including principal engineer, suspended
Biman Bangladesh Airlines has suspended its principal engineer and four other officials as two of the carrier's Boeing aircraft recently suffered damage after a collision in a Dhaka airport hangar.
The decision was taken based on the report of the investigation committee formed by the civil aviation and tourism ministry, said Dr Abu Saleh Mostafa Kamal, Biman's managing director and CEO.
The five officials include Principal Engineer Mohammad Badrul Islam, three engineer officers, and a ground support equipment operator.
They were held responsible for violating section 55 of the service rules of Bangladesh Biman Corporation Employees (1979) Regulations, a punishable offence, according to the report.
On April 10, a Boeing 737 collided with Boeing 777 while exiting the hangar.
The radome and front bulkhead of the 777 aircraft and the horizontal stabiliser on the left of the 737 aircraft were partially damaged.
This was the third accident to befall the Biman fleet since mid-February this year.
After undergoing repairs, both aircraft returned to service.
Clashes like this usually occur due to the carelessness of tow truck operators or ground teams.
Also read: Collision between two Biman planes at Shahjalal Int’l Airport
2 years ago
US-Bangla Airlines includes two more aircraft to its fleet
US-Bangla Airlines has included two Boeing 737-800 aircraft to its fleet.
With the inclusion of two Boeing 737s, the number of US-Bangla aircraft rose to 16.
Two Boeing 737-800 aircraft reached Dhaka’s Hazrat Shahjalal International Airport at 11:00 PM and 11:30 PM on Friday.
Also read: US Bangla launches Dhaka-Male-Dhaka direct flights
These two aircraft from Jordan has 189 economy class seats. US-Bangla is also going to start flights from Dhaka to Colombo, Sharjah, and Delhi route with this aircraft, said a media release.
Business development director of US-Bangla Airlines Capt. Lutfor Rahman and other officials of Civil Aviation Authority and US-Bangla Airlines were present at the at Hazrat Shahjalal International Airport while receiving the aircraft.
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2 years ago
Boeing says pandemic will cut demand for planes for a decade
Boeing is lowering its expectations around demand for new planes over the next decade as the coronavirus pandemic continues to undercut air travel.
4 years ago
Virus outbreak in China poses a new problem for Boeing
Boeing sold no new airline jets in January, and now the company is worried that the virus outbreak in China could hurt airplane deliveries in the first quarter.
4 years ago
PM to inaugurate construction of Dhaka airport’s 3rd terminal Saturday
Prime Minister Sheikh Hasina will inaugurate the construction of the third terminal of Hazrat Shahjalal International Airport (HSIA) on Saturday.
4 years ago
Boeing's Starliner capsule makes launch debut, but hits snag
Boeing's new Starliner capsule ran into trouble and went off course in orbit minutes after blasting off Friday on its first test flight, a crucial dress rehearsal for next year's inaugural launch with astronauts.
4 years ago
Boeing gets FAA message, will halt Max production in January
The message to Boeing Co. from the Federal Aviation Administration was clear: The grounded 737 Max won't get approval to fly again anytime soon. So the company had little choice but to idle the giant factory where the plane is made.
4 years ago