Enormous loss of confidence

No doubt the Germans have a glorious compound word for the act of “tempting fate by slagging off an aeroplane manufacturer while travelling north at 37,000ft in one of its comfortable 787s”, but sadly I cannot Google it due to the woeful quality of Wi-fi on British Airways.

And at least it is a 787 which boasts an impeccable safety record, rather than the 737 Max whose flightcontrol software appears to have caused two tragic crashes in the past six months with the loss of 346 lives.

Now there are about 350 of these planes grounded around the world, and Boeing is scrambling to provide a software fix for its MCAS system alongside appropriate pilot training on it, but even if it manages to get approval to get the fleet back in the air, passengers are unlikely to be hurrying back on board.

Meanwhile, Boeing will be facing compensation claims from the families of crash victims, the direct costs of fixing the fleet, potential claims from airlines as a result of the grounding, delayed delivery of the aircraft that are still being built and the possibility of airlines cancelling orders.

The 737 Max was the fastest-selling jet in Boeing’s history, contributing to a bumper year in 2018 when revenues topped $100bn for the first time, generating profits of $10bn. It ended the year with $8bn in cash, and may well need every cent of it if it can’t get the problems fixed pronto. Boeing will carry significant insurance coverage which will mitigate the immediate economic downside, but the loss of confidence in its reputation will be enormous.