The Memo: Boeing in legal trouble over safety concerns

In January, the aircraft manufacturer Boeing landed in hot water after a section of one of its planes shot off and left a hole in the fuselage. The incident occurred during a routine Alaska Airlines flight between Oregon and California. Thankfully, no one was seriously injured as the seats by the blown off panel were empty, even though there were only seven unoccupied spots on the whole plane. Phones, socks and even a boy’s shirt were sucked out of the cabin, but the passengers closest to the blowout only escaped this fate themselves because they were wearing their seatbelts.  

Evidently, this isn't something that can just fly under the radar. Since this incident, critics have once again accused Boeing of cutting corners on safety procedures to save time and money. A few years ago, Boeing faced questions concerning the safety of their 737 MAX aircraft after two fatal crashes in 2018 and 2019 which resulted in the deaths of everyone on board. The Alaska Airlines plane was also a 737 MAX. In response to fears over the safety of Boeing’s aircraft, the US Federal Aviation Administration has imposed a cap on the number of aircraft Boeing can manufacture and is carrying out stricter factory safety checks. 

Several lawsuits have been filed against Boeing over this latest incident. Shareholders are suing the company, accusing it of misleading them over its commitment to building safe aircraft and prioritising profit over safety. At least three lawsuits have been filed by passengers on the Alaska Airlines flights and, if these lawsuits are successful, Boeing could be paying out billions of dollars. The US Justice Department has also begun a criminal investigation into Boeing over the incident.  

Needless to say, this level of public scrutiny is having a negative impact on how the Boeing brand is perceived by the public. So, regardless of whether its planes are taking off or not, the company’s reputation is up in the air. The aviation industry is dominated by the rival manufacturing companies Boeing and Airbus so, not only could court cases be costly, but reduced confidence in Boeing's brand could create a competitive advantage for Airbus. The impact of the scandal will almost certainly be felt across the world, including in the UK. Quite simply, the cap on Boeing’s aircraft production will mean there are fewer planes to go around. In March, Boeing’s deliveries fell by half, yet demand for air travel is predicted to remain high. As with any other commodity, if demand is high and supply is low, prices are likely to skyrocket.