Business
Boeing CEO Defends His Safety Record, Spars With Senators And Apologizes To Crash Victims’ Relatives
During a bruising Senate hearing on Tuesday, Boeing CEO David Calhoun defended the company’s safety record while members accused him of prioritizing profits over safety, failing to protect whistleblowers, and even receiving excessive pay.
Relatives of victims killed in two Boeing 737 Max plane tragedies were in the room, some holding photos of their loved ones to remind the CEO of the dangers. Calhoun began his speech by standing, turning to face the families, and apologizing “for the grief that we have caused,” pledging to prioritize safety.
Calhoun’s testimony before Congress was the first by a high-ranking Boeing official since a panel blew off a 737 Max on an Alaska Airlines flight in January. The event did not result in significant injuries but aroused new concerns about the company’s best-selling commercial aircraft.
The tone of the hearing before the Senate investigations subcommittee was established hours earlier when the panel released a 204-page report containing additional charges from a whistleblower who expressed concern that defective parts were being used in 737s. The whistleblower is the latest in a long line of current and former Boeing employees who have expressed concerns about the company’s manufacturing practices, which federal regulators are investigating.
Boeing | AP News Image
Boeing CEO Defends His Safety Record, Spars With Senators And Apologizes To Crash Victims’ Relatives
“This hearing is a moment of reckoning,” subcommittee chairman Richard Blumenthal, D-Conn., declared. “It’s about a company, a once iconic company, that somehow lost its way.”
Sen. Josh Hawley, R-Mo., blamed Calhoun, claiming that the man who became CEO in January 2020 was too focused on the bottom line.
“You are cutting corners, you are eliminating safety procedures, you are sticking it to your employees, you are cutting back jobs because you are trying to squeeze very piece of profit you can out of this company,” Hawley stated in a higher tone. “You are strip-mining Boeing.”
Hawley repeatedly cited Calhoun’s $32.8 million salary from last year and questioned why the CEO had not resigned.
“Senator, I’m going to see this through. I’m proud to have taken this position. I’m pleased of our safety record, and I’m proud of our Boeing employees,” said Calhoun, who has announced his resignation by the end of the year.
Hawley interrupted. “You’re proud of the safety record?” he asked, perplexed.
“I am proud of every action we have taken,” Calhoun said.
Senators grilled Calhoun on allegations that Boeing managers penalized employees who raised safety concerns. They asked the CEO if he had ever spoken with any whistleblowers. He said he hadn’t but agreed it was a nice idea.
The latest whistleblower, Sam Mohawk, a quality assurance investigator at Boeing’s 737 assembly facility outside Seattle, told the subcommittee that “nonconforming” parts — those that could be defective or not properly documented — could end up in 737 Max aircraft.
Mohawk alleged that Boeing suppressed evidence after the Federal Aviation Administration informed the business that it planned to inspect the factory in June 2023.
“Once Boeing received such a notice, it ordered the majority of the (nonconforming) parts that were being stored outside to be moved to another location,” Mohawk stated in the report. “Approximately 80% of the parts were moved to avoid the watchful eyes of the FAA inspectors.”
Mohawk stated that the parts, which included rudders, wing flaps, and other components necessary for aircraft control, were later returned or lost.
A Boeing spokeswoman stated that the firm received the subcommittee report late Monday night and is evaluating the claims.
The FAA stated that it would “thoroughly investigate” the allegations. A spokeswoman stated that the government has received more reports of safety issues from Boeing personnel since the January 5 rupture on the Alaska Airlines Max.
The 737 Max has a troublesome history. After Max jets crashed in Indonesia in 2018 and Ethiopia in 2019, killing 346 people each, the FAA and other agencies grounded the aircraft for more than a year and a half. The Justice Department is considering prosecuting Boeing for breaking the terms of a 2021 settlement over charges that the corporation misled regulators who authorized the plane.
Mohawk told the Senate hearing that the quantity of problematic parts has increased dramatically since production of the Max resumed following the incidents. He claimed that the increase prompted superiors to instruct him and other employees to “cancel” documents indicating that the parts were unsuitable for plane installation.
Following the mid-air burst of a plug covering an emergency exit on an Alaska Airlines plane in January, the FAA temporarily grounded certain Max flights. The agency and the National Transportation Safety Board began separate investigations into Boeing, which are still ongoing.
Boeing | AP News Image
Boeing CEO Defends His Safety Record, Spars With Senators And Apologizes To Crash Victims’ Relatives
Calhoun stated that Boeing has responded to the Alaska tragedy by reducing production, encouraging employees to raise safety problems, shutting down assembly lines daily to allow workers to discuss safety, and appointing a former Navy admiral to conduct a quality review. Late last month, Boeing delivered an improvement plan requested by the FAA.
Calhoun defended the company’s safety culture, admitting it “is far from perfect.”
The drumbeat of bad news for Boeing has continued throughout the last week. The FAA said it was looking into how falsely documented titanium parts ended up in Boeing’s supply chain; the company revealed that fasteners were incorrectly installed on the fuselages of some jets, and federal officials examined “substantial” damage to a Southwest Airlines 737 Max following an unusual mid-flight control issue.
During the hearing, Howard McKenzie, Boeing’s top engineer, stated that the problem with the Southwest airliner, which he did not describe in detail, was limited to that plane.
Blumenthal first requested Calhoun’s appearance before the Senate subcommittee when another whistleblower, a Boeing quality engineer, claimed that manufacturing flaws were posing safety hazards on two of Boeing’s largest jets, the 787 Dreamliner and the 777. He stated that the corporation needed to explain why the public should believe in Boeing’s work.
Boeing denied the whistleblower’s assertions, claiming that comprehensive testing and inspections revealed none of the issues the engineer had foreseen.
Boeing | AP News Image
Boeing CEO Defends His Safety Record, Spars With Senators And Apologizes To Crash Victims’ Relatives
Last month, the Justice Department found that Boeing breached a 2021 settlement that protected the firm from fraud charges for allegedly deceiving regulators who approved the 737 Max. According to a senior department official, Boeing failed to implement steps to detect and prevent future infractions of anti-fraud rules.
Prosecutors have until July 7 to decide what they will do next. Blumenthal claimed that there is “mounting evidence” that the firm should be penalized.
Families of the victims of the Max crashes have frequently urged the Justice Department to punish the business and its leaders. They want a federal judge in Texas to overturn the 2021 deferred-prosecution agreement or DPA — effectively a plea deal — that allowed Boeing to escape prosecution for fraud in connection with the Max.
Catherine Berthet, whose daughter Camille perished in the second disaster, stated outside the Capitol on Tuesday that despite having three years to improve their safety process, they failed to do so. “Now they have to be made accountable.”
SOURCE – (AP)
(VOR News) – The Alibaba Cloud (or Aliyun) data facilities in Australia and India will soon be shutting down.
The business issued a statement on its website that read, “As part of Alibaba Cloud’s infrastructure strategy update, we have decided to cease operations at our data centers in Australia and India while enhancing our investment in Southeast Asia and Mexico after careful assessment.”
The two countries’ data centers, in Mumbai and Sydney, are expected to close in July and September, respectively. Data centers in Mumbai will be shut down by July 15th, and those in Australia will be shut down by September 30th.
The corporation had “issued multiple rounds of notifications and technical migration plans to affected customers” since December 2023, according to the notice.
Alibaba has also asked impacted customers to move their data to the Singapore area or another appropriate location as quickly as possible. Analysts believe that customers will not be charged for the move, even though Alibaba did not answer to an email asking for clarification on whether or not these migrations will be paid.
Also, I sent an email asking why the data centers in those two nations shut down, but nobody answered.
Concerns about growth and geopolitical tensions
Possible influences on the decision to shut down operations in both nations include geopolitical tensions and Alibaba’s struggles with the expansion of its cloud business in those two nations.
“Alibaba is closing its operations in these two countries due to the limited business opportunities in these markets,” expressed Rajiv Ranjan, associate research director at IDC.
According to Ranjan, there are a number of factors, including the level of market maturity, that contribute to the limited opportunities for business expansion in these countries.
When it comes to cloud computing, Australia is well-established and has major providers like AWS, Google, and Azure. According to Ranjan, Alibaba’s data center size betrays its restricted operations, and the company’s small client base and lack of operations make it difficult to build a respectable market position.
Contrary to the company’s tradition of building huge data centers, Ranjan explained that the data center in Australia is a colocation facility. This, he added, is also true in India, where the business has two small availability zones in Mumbai. While Google and Oracle are quickly increasing their footprint in the Indian public cloud industry, Azure and AWS remain dominant. This creates problems for Alibaba, says Ranjan.
According to Jain, the use of Chinese brands is not well-received in both markets, but more so in India due to the stagnation of diplomatic relations between the two countries.
Mexico and Southeast Asia are on Alibaba’s expansion list.
Analysts agree that Mexico and Southeast Asia should be Alibaba Cloud’s primary investment targets.
A stronger brand presence in Southeast Asia has been achieved through Alibaba’s e-commerce operation. Their decision to focus on that sector is a direct result of that, Ranjan noted. To elaborate, Ranjan said that the data localization policy was the impetus for Alibaba to build a second availability zone in India’s data centers in 2022.
The goal of the firm, as Ranjan explained, was to get the most clients possible by using the investment.
In addition to their main client, Paytm, they have clients including Oppo, Vivo, DLF, and Reliance Entertainment in India. But according to Ranjan, their plans for expansion were thwarted since hyperscalers existed.
Alibaba’s public cloud products were on sale for up to 59% off in April.
It was seen by analysts as a move to lessen the impact of competition from bigger hyperscalers in nations including the US, UK, UAE, SK, IL, SG, MM, PH, and TT.
The growth of Azure and AWS is expected. Businesses leaving Alibaba Cloud will face higher costs associated with switching to a new cloud provider, says Charlie Dai, a principal analyst at Forrester.
Despite this, analysts said that customers may choose other cloud service providers since they are uncomfortable sending their data abroad. Most of the customers that are going to leave Alibaba Cloud will probably go to Azure or AWS. Ranjan claims that AWS might gain from its Infrastructure as a Service (IaaS) status because it controls 60% of the Indian IaaS market.
Some budget-conscious customers may be interested in Alibaba Cloud because its costs are more in line with those of Google and Oracle, according to the analyst.
Azure and AWS could seem pricey to certain customers. But Azure has raised prices for the first six months of 2024,” Ranjan went on to say.
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Under Pressure On Plane Safety, Boeing Is Buying Stressed Supplier Spirit For $4.7 Billion
Arlington, Virginia – Boeing has announced plans to acquire crucial supplier Spirit AeroSystems for $4.7 billion, claiming that the acquisition will boost jet quality and safety in the face of increased scrutiny from Congress, airlines, and the Department of Justice.
Boeing formerly controlled Spirit, and the acquisition would reverse a long-standing Boeing strategy of outsourcing critical work on its passenger jets. This technique has been criticized after problems at Spirit hampered the manufacturing and delivery of major Boeing jetliners such as the 737 and 787.
Boeing |Ap News Image
Under Pressure On Plane Safety, Boeing Is Buying Stressed Supplier Spirit For $4.7 Billion
“We believe this transaction is in the best interests of the flying public, our airline customers, the employees of Spirit and Boeing, our shareholders, and the country as a whole,” Boeing President and CEO Dave Calhoun said in a statement late Sunday.
Safety concerns arose following the January 5 burst of a panel on an Alaska Airlines 737 Max 9 at 16,000 feet (4,876 meters) over Oregon. The Federal Aviation Administration soon announced greater oversight of Boeing and Spirit, which supplied the plane’s fuselage.
There were no significant injuries in the Alaska Airlines door incident, which startled passengers, but the US Justice Department is pressuring Boeing to plead guilty to criminal fraud in connection with two catastrophic airline disasters involving its 737 Max jetliners more than five years ago.
According to three people who heard federal prosecutors outline a planned offer on Sunday, Boeing has until the end of the week to accept or reject the offer. The offer includes the major aerospace corporation agreeing to an independent monitor to oversee its compliance with anti-fraud rules.
In a May court filing, the Justice Department stated that Boeing breached the conditions of a 2021 settlement that allowed the corporation to avoid prosecution for its activities leading up to the Ethiopia and Indonesia crashes, which killed 346 people.
These crashes were caused by a defective sensor in a flight-control system, and the investigation is different from the one into the more recent Alaska Airlines blowout, which involved Spirit.
In 2005, Boeing spun off Spirit, a company based in Wichita, Kansas, unrelated to Spirit Airlines. In recent years, quality issues have arisen, such as fuselage panels that needed to fit together precisely enough and holes that were incorrectly drilled.
Boeing | AP News Image
Under Pressure On Plane Safety, Boeing Is Buying Stressed Supplier Spirit For $4.7 Billion
Spirit fired its CEO in October and replaced him with Patrick Shanahan, a former Boeing executive who served as temporary defense secretary during the Trump administration.
Things appeared to be going more smoothly until the Alaska Airlines incident. Investigators said a panel used to replace an extra emergency door was removed at a Boeing factory to allow Spirit workers to repair broken rivets, and bolts that keep the panel in place were missing following the repair. It is unclear who removed the bolts and neglected to reinstall them.
Spirit announced in May that it was cutting off approximately 450 workers at its Wichita factory due to a production slowdown following the January event. Its overall workforce numbered just over 13,000.
“Bringing Spirit and Boeing together will enable greater integration of both companies’ manufacturing and engineering capabilities, including safety and quality systems,” Shanahan told the media.
According to the aerospace business, the stock value of the acquisition is $4.7 billion, or $37.25 per share, while the total value of the transaction is roughly $8.3 billion, including Spirit’s most recent declared net debt.
Boeing said its common stock will be exchanged for Spirit shares using a variable formula based on a weighted average of the share price during a 15-day trading period that concludes on the second day before the transaction closes.
The businesses also announced a deal with Airbus to pursue the purchase of Spirit assets associated with the European aerospace firm’s programs. The Airbus agreement will take effect after Boeing’s acquisition of Spirit is completed, according to the two US businesses.
SOURCE – (AP)
WestJet, Canada’s second-largest airline, said it had to cancel at least 235 flights on Saturday because the maintenance workers’ union went on strike. This affected 33,000 people. The Aircraft Mechanics Fraternal Association said that its members went on strike on Friday night because the airline was “unwilling to negotiate with the union.”
Thursday, the federal government sent an executive order for binding arbitration, which led to the strike. That came after two weeks of rough talks with the union about a new deal.
Leaders from WestJet said at a news conference in Calgary that 150 more flights could be canceled by the end of the day if the strike wasn’t stopped. When asked what caused the problem, Alexis von Hoensbroech, CEO of the airline, said it was a “rogue union from the U.S.” trying to make gains in Canada.
From the airline’s point of view, Von Hoensbroech said that talks with the union were over once the government sent the case to formal arbitration.
WestJet Strike Called Pointless
“This makes a strike completely pointless, because the whole point of a strike is to put pressure on the other side of the bargaining table,” he said. It doesn’t make sense to go on strike if there isn’t a talking table.
Plus, the union turned down a deal that would have made the mechanics at the plane the “best paid in the country.”
During the Canada Day long weekend, there is a surprise strike that is affecting both domestic and foreign flights.
The union negotiating committee told its members about an order from the Canada Industrial Relations Board that doesn’t directly say that there can’t be any strikes or lockouts while the tribunal does its arbitration work.
The WestJet aircraft repair engineer Sean McVeigh who was picketing at Toronto Pearson International Airport Terminal 3 on Saturday said that the strike is an effort to get the airline to return to a “respectful negotiation.”
McVeigh said that the union is sorry for any trouble this has caused for travelers.
“However, the reason they (passengers) may have missed a flight or had to cancel is because WestJet is not respectfully sitting down at the table and negotiating,” he said on the picket line with about 20 other people. “We work hard and deserve some money for all the work we do,” he said.
Samantha Sahan and Samee Jan, two WestJet passengers at Pearson, said they were going to leave on Saturday with extended family for a trip to Calgary that they had been planning for six to eight months.
They got texts earlier in the day telling them their flight had been rescheduled for Monday, but Sahan said they still went to the terminal. They were trying to get more information and the strike made it hard to plan their trip, he said.
“Their inaction hurts a lot of people, including their own business and customers who probably won’t buy from them again,” Sahan said.
Jan said it was “sad” what was going on.
Canada’s WestJet has been around since 1996 and is known for having nice staff and low prices. It began small but quickly grew. Now, it flies to more than 100 places in Europe, North America, Central America, and the Caribbean.
They use new planes and put a lot of thought into making them comfortable and reliable. WestJet Rewards is an easy-to-use reward program that gives you points you can use. They have a good app that makes booking flights and checking in easy.
WestJet has great customer service. They’re friendly and willing to help, so your trip goes smoothly from beginning to end. Plus, they have lounges and seats for business visitors who want more comfort. Overall, WestJet does a good job of adapting to market changes and maintaining its high level of service without going over budget.
Source: AP
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