WASHINGTON - US aerospace manufacturer Boeing said Wednesday it was in favor of a tax reform in Washington state that would eliminate a tax break but defuse a long-standing dispute with the European Union.
President Donald Trump's administration imposed punitive tariffs on a record $7.5 billion in EU products in a dispute over government subsidies to Airbus, with authorization of the World Trade Organization.
And Trump on Friday raised the tariff on aircraft to 15 percent from 10 percent as part of those sanctions.
The European Union has threatened to follow through with penalties against the United States for support granted to Boeing, but the American firm said the state tax reform would resolve the issue.
"We fully support and have advocated for this action," Boeing said in a statement.
"When enacted, this legislation will resolve the sole finding against the United States in the long-running trade disputes between Europe and the United States over government support for the production of large commercial airplanes."
The change, which removes a 40 percent tax reduction for aerospace, will demonstrate US commitment "to fair and rules-based trade, and to compliance with the WTO’s rulings," the company said.
Boeing, which has its main manufacturing facilities in the northwestern US state of Washington, saved about $230 million in 2018 from this and other tax breaks.
Meanwhile, Airbus benefited from "billions of dollars of illegal 'launch aid' subsidies ... which the WTO has repeatedly found to violate global trade rules," Boeing said and the issue remains unresolved.
"Now is the time for Airbus and the European Union to finally come into compliance by ending illegal launch aid subsidies once and for all and addressing the harm they have caused the United States aerospace industry and its workers."
The EU also has called for "a negotiated solution to the aircraft disputes on the basis of the concrete EU proposals for existing subsidies and future disciplines in this sector."
The epic legal battle between Airbus and Boeing at the WTO began in 2004 when Washington accused Britain, France, Germany and Spain of providing illegal subsidies and grants to support the production of a range of Airbus products.
A year later, the EU alleged that Boeing had received $19.1 billion worth of prohibited subsidies from 1989 to 2006 from various branches of the US government.
The two cases were then tangled up in a legal quagmire, with each side being given partial vindication after a long series of appeals and counter appeals.
Agence France-Presse
Police officers inspect the Pegasus Airlines Boeing 737-86J plane, that overran the runway during landing and crashed, at Istanbul's Sabiha Gokcen airport, Turkey on Wednesday. At least three people were reported killed and 173 injured.
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WASHINGTON - President Donald Trump is counting on a strong US economy to seal his reelection victory but the Boeing crisis and ongoing trade frictions could undermine that strategy.
Trump on Wednesday criticized Boeing as a "very disappointing company" because of the aerospace giant's recent problems after the worldwide grounding of the 737 MAX plane, which is having knock-on effects for the broader economy.
He also has lashed out at the Federal Reserve for mishandling monetary policy and keeping borrowing costs too high, which he says is likewise holding back the US economy.
Other scapegoats include Europe and China, which he says use trade policies to take advantage of or steal from the United States, and any country with a weak currency against the US dollar.
And as the impeachment trial against him proceeds in the Senate, Trump of course has blamed Democrats for a political attack that is distracting from his policy priorities.
However, no matter whom he chooses to cast as a culprit, the data show it is the trade wars Trump launched against multiple trading partners that are having the biggest effect, causing investment to screech to a halt amid widespread uncertainty.
Still, he is right about the potential damage from the travails at Boeing, which halted production of the top-selling 737 MAX aircraft after it was grounded following a pair of deadly crashes that killed 346 people.
TRADE WARS WEIGH
Heading into the final months before the presidential elections in November, Trump has repeatedly taken credit for record stock exchange levels and cited his partial trade deal with China as proof of the success of his economic policies.
"Nobody has done so much as I've done," Trump said in an interview with Fox Business Network from the economic forum in Davos, Switzerland, where he also floated the possibility of a middle-class tax cut.
But economists warn the partial China trade agreement signed this month is a patch that eases only some of the uncertainty about new tariffs and leaves two-thirds of the products exchanged between the economic powers still subject to punitive duties.
And while in Davos Trump also renewed his attacks on the European Union, again threatening to strike back with crippling tariffs on imported cars.
Continued uncertainty over trade could drag US growth below 2.0 percent, according to many forecasts.
Analysts at Oxford Economics warn "conditions aren't yet in place for an industrial rebound," noting that consumer spending also softened at the end of 2019.
BOEING CUTTING US GROWTH
Boeing on Tuesday officially pushed back the time frame for the 737 MAX to return to the skies, until mid-2020, and Trump lamented that Boeing's woes have "had a tremendous impact" on the economy.
"You know when you talk about growth, it's so big that some people say it's more than a half a point of GDP. So Boeing -- big, big disappointment to me," Trump said in an interview on CNBC."
The aviation giant's newly-installed CEO David Calhoun acknowledged Boeing's importance to the US economy.
The "criticality to the country just speaks for itself," Calhoun said Wednesday in a call with reporters, his first public remarks and the first interaction with reporters by a Boeing executive since the start of the MAX crisis in March 2019.
"Everyone wants Boeing to succeed for the sake of the country and I understand that and I have it on my shoulders."
Oxford Economics last month projected that the MAX production shutdown could slash half a point off the US economy's annual growth rate in the first quarter of 2020 due to slower investments and exports.
And while Boeing has reassigned its own workers during the production halt, one key supplier -- Spirit AeroSystems -- laid off 2,800 employees this month.
Things could get worse if the stoppage drags on -- cutting 0.2 percentage points off growth for the full year, according to IHS Markit.
Agence France-Presse
Boeing Co's ousted chief executive officer Dennis Muilenburg is leaving the company with $62 million in compensation and pension benefits but will receive no severance pay in the wake of the 737 MAX crisis.
Muilenburg was fired from the job in December as Boeing failed to contain the fallout from a pair of fatal crashes that halted output of the company's bestselling 737 MAX jetliner and tarnished its reputation with airlines and regulators.
The compensation figures were disclosed in a regulatory filing late on Friday during a difficult week for Boeing when it also released hundreds of internal messages -- 2 major issues hanging over the company before new CEO David Calhoun starts on Monday.
The messages contained harshly critical comments about the development of the 737 MAX, including one that said the plane was "designed by clowns who in turn are supervised by monkeys."
The 737 MAX has been grounded since March following the second of 2 crashes that together killed 346 people within a span of 5 months.
Lawmakers blasted Boeing on Friday.
"346 people died. And yet, Dennis Muilenburg pressured regulators and put profits ahead of the safety of passengers, pilots, and flight attendants. He'll walk away with an additional $62.2 million. This is corruption, plain and simple," US Senator Elizabeth Warren said on Twitter.
US Rep. Peter DeFazio, who chairs the House Transportation Committee, said minutes of a June 2013 meeting showed that Boeing sought to avoid expensive training and simulator requirements by misleading regulators about an anti-stall system called MCAS that was later tied to the 2 crashes that killed 346 people.
The MAX has been grounded since the second crash in March.
Speculation that Muilenburg would be fired had been circulating in the industry for months, intensifying in October when the board stripped him of his chairman's title - although he had also twice won expressions of confidence from Calhoun, Boeing's board chairman.
A turnaround veteran and former General Electric Co executive who has led several companies in crisis, Calhoun will receive a base salary at an annual rate of $1.4 million and is eligible for $26.5 million in long-term incentive compensation, Boeing said in a filing.
Boeing said in November Muilenburg had volunteered to give up his 2019 bonus and stock awards. For 2018, his bonus and equity awards amounted to some $20 million, according to filings.
In addition to the $62 million in compensation and pension benefits, Muilenburg holds stock options that vested in 2013, Boeing said. They would be worth $18.5 million at the closing price on Friday.
"Upon his departure, Dennis received the benefits to which he was contractually entitled and he did not receive any severance pay or a 2019 annual bonus," Boeing said in a statement.
source: news.abs-cbn
OTTAWA—Canada has intelligence from multiple sources indicating a Ukrainian airliner that crashed on Wednesday near Tehran was shot down by an Iranian surface-to-air missile, Prime Minister Justin Trudeau said on Thursday.
US officials had earlier said the airliner was most likely brought down accidentally by Iranian air defenses. All 176 people on board, including 63 Canadians, were killed.
"We have intelligence from multiple sources, including our allies and our own intelligence. The evidence indicates that the plane was shot down by an Iranian surface-to-air missile," Trudeau told a news conference in Ottawa.
"This may well have been unintentional. This new information reinforces the need for a thorough investigation into this matter," he continued.
Trudeau said his government would not rest until it had obtained closure, transparency, accountability and justice.
He also said he had spoken to Ukrainian President Volodymyr Zelenskiy, who told him that Iran would allow investigators from Kiev into the country.
source: news.abs-cbn.com
Passengers' belongings are collected after a Ukraine International Airlines Boeing 737 crashed shortly after take-off from Iran's Imam Khomeini airport.
The crash on Wednesday, which killed all on board, comes at a tense time for both Iran and Boeing. Iran's top general Qassem Soleimani was killed in a US airstrike last week, while Boeing is still reeling from the crashes of its 737 Max airplanes.
source: news.abs-cbn.com
WASHINGTON -- Boeing Co and the Federal Aviation Administration (FAA) confirmed on Sunday they are reviewing a wiring issue that could potentially cause a short circuit on the grounded 737 MAX.
Boeing spokesman Gordon Johndroe said Sunday the US planemaker "identified this issue as part of that rigorous process, and we are working with the FAA to perform the appropriate analysis. It would be premature to speculate as to whether this analysis will lead to any design changes."
The New York Times reported Boeing is reviewing whether two bundles of wiring are too close together, which could lead to a short circuit and potentially result in a crash if pilots did not respond appropriately.
The FAA said in a statement Sunday the agency and company "are analyzing certain findings from a recent review of the proposed modifications to the Boeing 737 MAX." The agency added it would "ensure that all safety related issues identified during this process are addressed."
Boeing is currently working to design separating the wiring bundles if necessary and conducting extensive analysis to establish if the electrical fault could occur in a real-world scenario, a company official said.
Officials said the FAA had directed Boeing to complete an audit in December. The wiring issue could push back the return of the MAX, the officials added. Reuters has reported previously the FAA is not likely to approve the plane until at least February and might not until March or later.
The FAA flagged the wiring issue as potentially "catastrophic." It is possible other protections like shielding, insulation and circuit breakers could prevent the short circuit, a company official said.
Boeing will halt production of the 737 MAX this month following the grounding in March of its best-selling plane after two fatal crashes in five months killed 346 people.
Last month, Boeing's board fired Chief Executive Dennis Muilenburg after repeatedly failing to contain the fallout from the crashes that tarnished its reputation with airlines and regulators.
The crisis has cost Boeing $9 billion, and has hurt suppliers and airlines.
Boeing is struggling to mend relations with the U.S. and international regulators it needs to win over to get the jet back in the air.
Separately, US and European regulators are expected to return to Iowa this week to review a software documentation audit of the 737 MAX that was not completed last year, officials said Sunday. FAA and the European Union Aviation Safety Agency are scheduled to meet in Seattle this week and then return to Rockwell Collins facility in Cedar Rapids, Iowa next weekend to review the audit.
source: news.abs-cbn.com
NEW YORK — Boeing on Monday pushed out its embattled chief executive, Dennis Muilenburg, as it attempts to pivot from a protracted crisis surrounding the grounding of its top-selling 737 MAX after 2 deadly crashes.
More than nine months after the MAX was grounded and a week after halting production of the aircraft, Boeing named board Chairman David Calhoun as chief executive and president, saying the company needed to "restore confidence" and "repair relationships with regulators, customers and all other stakeholders."
A week ago, Boeing took the monumental step of temporarily shutting down MAX production because of the crisis, which has pushed the aircraft's return to the skies into 2020 and raised the anxiety level among Boeing's workforce and suppliers.
Though coming during the sleepy days ahead of the Christmas holiday, the move was not entirely unexpected after Boeing stripped Muilenburg of his chairman title in October, installing board member Calhoun in that post.
Still, while Boeing watchers had seen Muilenburg's days as numbered, some expected him to stay on until the MAX was returned to service.
But the timing of that landmark event remains unclear and will depend on the Federal Aviation Administration, which has made it clear it is not in a hurry.
An FAA spokesman said the agency does not comment on personnel decisions.
"The FAA continues to follow a thorough process for returning the Boeing 737 MAX to passenger service," the FAA spokesman said. "Our first priority is safety, and we have set no timeframe for when the work will be completed."
Muilenburg repeatedly offered predictions on the 737 MAX return to service that proved overly-optimistic. His prospects further dimmed last week when its Starliner unmanned spacecraft came up short in a NASA mission to reach the International Space Station.
Muilenburg's departure was "long overdue," said former National Transportation Safety Board chief Jim Hall.
"Boeing clearly needs to reset the table and put someone in who puts safety first," Hall told AFP.
ANOTHER INSIDER?
Shares rallied on the announcement of the leadership shakeup, which came after calls in Congress for Muilenburg to go. The stock price jumped 2.9 percent to finish at $337.55.
But Scott Hamilton of Leeham News, an aviation website, noted that Calhoun had roundly praised Muilenburg's performance as CEO in a November television interview.
The executive has been "part of the Board policy-making that led to the cost-cutting some say had deleterious impact on the development of the MAX," Hamilton wrote.
"Calhoun has been on the board 10 years," he said. "Is Calhoun, an insider, the right person to pull Boeing out of its dive?"
Senator Richard Blumenthal, a Democrat from Connecticut, called for a "complete management house cleaning" at Boeing and new leadership "who will take safety seriously."
Calhoun previously served as vice chairman of General Electric, where he had a long career after starting with the company soon after graduating from Virginia Tech. He also currently serves as senior managing director of investment banking firm Blackstone Group.
Following the announcement, Calhoun reached out to lawmakers, airline CEOs, suppliers, regulators and other key stakeholders, a Boeing spokesman said.
Muilenburg will leave the company immediately but Calhoun will not take the CEO post until January 13, 2020, while he exits existing commitments, Boeing said in a news release.
During that period, Chief Financial Officer Greg Smith will serve as interim CEO. Meanwhile, board member Lawrence W. Kellner will become non-executive chairman of the board effective immediately.
AWKWARD RESPONSE TO CRISIS
Muilenburg's response to the crisis was increasingly criticized as the MAX grounding has dragged on far longer than initially expected as more disturbing details have dribbled out about the certification of the aircraft and issues with the flight software implicated in both crashes.
He also was seen as tone deaf and awkward towards families of the 346 people killed in the crashes.
Michael Stumo, whose daughter Samya was killed in the Ethiopian Airlines crash in March, called Muilenburg's departure "a good first step toward restoring Boeing to a company that focuses on safety and innovation."
"The next step is for several Board members who are underperforming or underqualified to resign," Stumo said.
The company resisted grounding the planes even after the second crash when Muilenburg pressed his case in phone calls with President Donald Trump.
Probes of the 2 crashes have focused in particular on the Maneuvering Characteristics Augmentation System, an automated flight control system.
FAA chief Steve Dickson ripped Muilenburg in October for not disclosing communications from a Boeing pilot that raised questions about the MCAS system.
The FAA also called out the company for its overly-optimistic statements about restoring the MAX saying it created the perception Boeing was trying "to force FAA into taking quicker action."
Agence France-Presse
WASHINGTON - Boeing is all set to launch its Starliner spacecraft for the first time to the International Space Station at the end of this week, a key mission as NASA looks to resume crewed flight by 2020.
This time around its sole passenger will be bandana-clad dummy Rosie, named after Rosie the Riveter, a campaign icon used to recruit women to munitions factory jobs during World War II.
"If we're blessed with great weather, I look forward to a mission early Friday morning, and then coming to the International Space Station on Saturday," Kathy Lueders, manager of NASA's Commercial Crew Program told reporters at the Kennedy Space Center in Florida.
"The spacecraft is in really good shape," added John Mulholland, vice president and program manager of the Boeing Commercial Crew Program.
The US has relied on Russia to transport its crews to the ISS since the end of the Space Shuttle program in 2011, but in 2014 hired Boeing and SpaceX under multi-billion dollar contracts, with the two companies already two years behind schedule.
NASA is now targeting next year to start the flights, as long as the tests are completed without a hitch.
The mission that starts Friday will last eight days and serves as a dress rehearsal.
The CST-100 Starliner, to give it its full name, will launch from Cape Canaveral at 6:36 am local time (1136 GMT) on an Atlas V rocket built by the United Launch Alliance, and will reach the station 25 hours later.
Starliner will then remain docked for seven days before detaching and returning home. It will land following a four-hour rapid descent in the New Mexico desert on December 28 at 3:46 am local time (1047 GMT).
SpaceX's capsule, known as Crew Dragon, undertook the same type of mission successfully last March. The main difference is that Crew Dragon lands in the ocean instead of dry land -- but both rely on parachutes to slow their descent.
Unlike in the past, NASA is paying companies for their services rather than owning the hardware, a move decided under former president Barack Obama and meant to save the taxpayer money.
As of May 2019, Boeing and SpaceX's contracts were valued at $4.3 billion and $2.5 billion, with each company awarded six round-trip missions to the ISS.
Assuming four astronauts per flight, NASA's auditor estimated the average cost per seat at $90 million for Boeing and $55 million for SpaceX, compared to the $80 million paid to Russia for the same service.
Since neither company is confirmed as being ready for 2020, NASA has begun negotiating the purchase of another seat with Russia for the fall of 2020, said Joel Montalbano, the agency's deputy ISS program manager. The last confirmed seat for an American on a Russian ship is for April 2020.
source: news.abs-cbn.com
NEW YORK -- United Airlines said Tuesday it had ordered 50 Airbus A321XLR aircraft, worth an estimated $6.5 billion, to replace an existing fleet of aging Boeings.
The new Airbus planes, which will be delivered in 2024, will allow United to retire its Boeing 757-200s, the company said.
The Airbus order is the latest blow to the American manufacturer, already deeply mired in the crisis surrounding its 737 MAX.
Boeing, whose 737 MAX has been grounded worldwide after two crashes that resulted in 346 deaths, currently has no new aircraft to compete with the Airbus A321XLR in the mid-market range.
Airbus launched the A321XLR only this year, at the Paris Air Show in June.
The single-aisle aircraft's range is 15 percent above that of its predecessor model, the A321LR, making it a cost-effective alternative to long-haul wide-body planes.
United said it would use the new aircraft to serve additional European destinations from US East Coast hubs in Newark/New York and Washington.
United turned to Airbus for the purchase due to Boeing's lack of aircraft in the mid-market range, a source close to the matter told AFP on condition of anonymity.
"There are no aircraft currently offered by Boeing that can replace the 757," the source said, adding that negotiations between Airbus and United began several months ago.
Boeing, which is currently focused on returning its MAX aircraft to the sky, has already postponed possible announcement of a new model aircraft (NMA) until next year.
The manufacturer recently presented the design to various airlines, industrial sources told AFP.
Airbus decided to no longer publish the catalog prices for its aircraft beginning in 2019. However, the A321XLR is a long-range version of the A321, whose unit value was $129.5 million in 2018.
United has meanwhile postponed receipt of its first 45 Airbus A350 long-haul aircraft by 5 years.
The company, which ordered the planes in 2017, said it now plans to have them delivered in 2027 instead of 2022.
Agence France-Presse
TBILISI, Georgia - Tired of your ordinary earthly vacations? Some day soon you might be able to board a rocket and get a room with a view - of the whole planet - from a hotel in space.
At least, that is the sales pitch of several companies racing to become the first to host guests in orbit on purpose-built space stations.
"It sounds kind of crazy to us today because it is not a reality yet," said Frank Bunger, founder of US aerospace firm Orion Span, one of the companies vying to take travelers out of this world.
"But that's the nature of these things, it sounds crazy until it is normal."
US multimillionaire Dennis Tito became the world's first paying space tourist in 2001, traveling to the International Space Station (ISS) aboard a Russian Soyuz rocket for a reported $20 million. A few others have followed.
Since then, companies like Boeing, SpaceX and Blue Origin have been working on ways to bring the stars into reach for more people - opening up a new business frontier for would-be space hoteliers.
US space agency NASA announced in June that it plans to allow two private citizens a year to stay at the ISS at a cost of about $35,000 per night for up to a month. The first mission could be as early as 2020.
But the growing movement has raised questions about the adequacy of current space laws, which mainly deal with exploration and keeping space free of weapons, not hotels and holidaymakers.
"It is difficult now to want to do things in space and get a clear answer from (space law)," said Christopher Johnson, a space law adviser at the Secure World Foundation, a space advocacy group.
"For something as advanced as hotels in space there is no clear guidance."
ORBITAL HOLIDAY
Orion Span plans to host the first guests on its Aurora Station - a capsule-shaped spacecraft roughly the size of a private jet - by 2024, said Bunger.
Accompanied by a crew member, up to five travelers at a time would fly up to the station for a 12-day stay costing at least $9.5 million per head, he said.
In orbit, guests would take part in scientific experiments, enjoy some 16 sunrises and sunsets a day and play table tennis in zero gravity, he said, adding about 30 people had already put down a $80,000 deposit to save a seat.
"We haven't seen this kind of excitement about space since the Apollo era," Bunger told the Thomson Reuters Foundation by phone.
Californian company the Gateway Foundation is hoping to build a massive space station able to sleep more than 400 people - including tourists, researchers, doctors and housekeepers.
Solar-powered and shaped like a wheel, the station would spin around its core to create artificial gravity on its perimeter, equal to about one-sixth of that on earth, said its architect Tim Alatorre.
"The problem is that you can only spin so fast before you start feeling sick," he said. "We could easily create earth gravity on the station by spinning it faster but you wouldn't be very comfortable."
The group aims to complete the station, named after Wernher von Braun, the former Nazi rocket scientist who later worked on the US Apollo program, by 2028.
Without disclosing how much a space holiday would cost, Alatorre said the goal was to make the station "accessible to the everyday person".
"So somebody can save up and go on a vacation to the United States or they can save up and go on a vacation to space," he said.
Yet that could take time to become a reality, said Lucy Berthoud, a space engineering professor at Britain's University of Bristol.
"The launch cost is the bottleneck for anyone who is doing this kind of enterprise," she said.
For example, NASA is expected to pay more than $50 million per seat to launch astronauts into space with Boeing and SpaceX rockets.
"It will take an increase in competition between launchers and a jump in technology to significantly lower costs," said Berthoud.
In recent years, several companies - including Spain's Galactic Suite and Russia's Orbital Technologies - have failed to live up to their pledges to host guests on orbiting hotels by now.
LEGAL HURDLES
The law is another hurdle for space hotels to lift off.
The rush of speculation in space has revealed gaps in international laws and treaties governing its use and sparked calls for greater oversight.
Life far from earth is mainly regulated by the 1967 Outer Space Treaty, which bans countries from claiming space and celestial bodies for themselves but allows for their use for peaceful purposes - opening the door to business exploitation.
But firms would need authorization from a state, normally the one where they are incorporated, to launch a hotel in space, said Tanja Masson-Zwaan, space law professor at Leiden University in the Netherlands.
Authorizing governments would also have to continuously supervise each space station's activities, she said.
And all states involved in the creation and launch of a space station are liable in perpetuity for any damage the station might cause - if it were to crash into a satellite, for example.
That responsibility could make governments wary of supporting such ventures in the first place, said Masson-Zwaan.
"I don't think there will be many states that will accept to authorize and supervise this kind of activity as long as it is not super-safe," she said.
The regulations that do exist are outdated and problematic to potential space hoteliers, noted Bunger of Orion Span, pointing to the Aurora Station project as an example.
Because the station will have some thrust capability to help it stay in orbit, it falls under a 40-year-old US set of rules on defense goods conceived mainly to prevent sensitive arms technology being sold to countries deemed to be a risk, he said.
Those rules have requirements on transparency and disclosure that have more to do with ballistic missiles than space holidays, Bunger said.
"Clearly this is not a weapon," he said of the station.
"There is not one government in the world that has caught up to the reality that tourists are trying to go into space," he said.
source: news.abs-cbn.com
DUBAI -- Emirates and Boeing were poised on Wednesday to seal a compromise deal that would see the Dubai carrier order around 30 787 Dreamliners, paving the way for a reduced order for delayed 777X jets, people familiar with the matter said.
Emirates tentatively ordered 40 Dreamliners in 2017 but "tough" last-minute talks to finalize the order this week have hinged on negotiations over the fate of a massive separate order for 150 777X after the latter ran into delays, they said.
A restructuring of the 777X order may, however, not be highlighted officially at the Dubai Airshow, where Emirates plans an announcement for 0700 GMT on Wednesday (3 p.m. in Manila).
Emirates and Boeing declined to comment.
Sources cautioned talks were still going on in Dubai and the number of aircraft ordered could be subject to last-minute adjustments, but said it was unlikely Emirates would take all 40 787 jets announced at the largest Middle East air show in 2017.
One source said the order could involve as many as 35 787s.
Emirates has been looking at reducing part of its 777X order, which the airline's president Tim Clark said on Tuesday could be influenced by the delays and in turn determine whether it went ahead with a 787 deal.
Emirates says it no longer knows when it will receive its first 777X, which was supposed to be delivered next year. Boeing has said the 777X will be delivered in 2021.
Easing an eight-month-old crisis over the grounding of its smaller 737 MAX, Boeing had earlier at the Nov 17-21 show won tentative or firm orders for 60 of the grounded MAX jets.
But industry sources had warned that Boeing had risked leaving Dubai without resolving the critical set of interlocking deals with Emirates, the industry's largest customer for wide-body jets and the backbone for the 777X program.
A high-profile order announcement on Wednesday would also effectively deliver a message of support from Dubai for the troubled US planemaker, whose ongoing MAX crisis has harmed Emirates sister carrier flydubai, analysts said.
The United Arab Emirates, which includes Dubai, is a close ally of the United States, which has poured support into the region amid tensions between Iran and Gulf Arab states that provided a tense backdrop to the Middle East industry event.
source: news.abs-cbn.com
Just weeks after his inauguration, President Donald Trump toured Boeing’s factory in North Charleston, South Carolina, holding a rally with workers, admiring a new 787 Dreamliner and calling on the company to bring down the cost of new Air Force One planes.
But Boeing wanted something from Trump, too.
During a private conversation at the event, Boeing’s chief executive, Dennis A. Muilenburg, talked to Trump about a long-running trade dispute between the United States and the European Union that had its roots in the pitched rivalry between Boeing and Airbus, according to 3 people familiar with the meeting, who spoke on the condition of anonymity to discuss a delicate matter.
The case, which centered on subsidies that Europe provides Airbus, had been working its way through the World Trade Organization for years, but an end was finally in sight. In the event that it was settled on Trump’s watch, Muilenburg urged the president to enforce the ruling, which would mean levying tariffs on European goods.
On Wednesday, Boeing got its wish. After an announcement by the World Trade Organization, the Trump administration said it would tax as much as $7.5 billion of European exports annually.
It was the largest-ever authorized retaliation in the organization’s history, adding another layer of complexity to a global economy already rattled by brewing trade wars and further straining relations between the United States and the EU. And it was the government’s boldest-ever step to protect Boeing, the United States’ largest manufacturing exporter.
“All of those countries were ripping off the United States for many years,” Trump said Wednesday at a news conference with the president of Finland, an EU member. “They know I’m wise to it. We’ve had a lot of wins. This was a $7 billion win. Not bad.”
It was also a win for Boeing, one decades in the making. Boeing has pursued its case against Airbus since the waning days of the Clinton administration, compiling evidence and finally persuading the United States to file a complaint with the WTO in 2004.
Yet this is hardly a clean victory for Boeing. The company is in the midst of the biggest crisis of its 103-year history after the 737 Max was grounded because of two deadly crashes, and has infuriated many of its most important customers with its faltering response. Some of the customers affected by the Max grounding also buy Airbus planes and now face the prospect of higher costs as a result of the tariffs, adding to their frustrations with Boeing.
What’s more, in a case that the WTO is expected to decide next year, Europe accuses the United States of providing illegal subsidies to Boeing. A ruling against the United States could lead to tariffs against Boeing planes sold to European customers. Europe could also find ways to retaliate against the tariffs announced after last week’s ruling.
“It’s a Boeing victory,” said Richard Aboulafia, an aviation analyst at the Teal Group. “But one that may have unintended consequences that are not in Boeing’s interest.”
At issue was the substantial financial support that European countries have given to Airbus in the form of below-market-rate loans that are often forgiven. Without that support, the United States and Boeing argued, Airbus would never have been able to become a true rival to Boeing. With help from those loans, Airbus went from having less than 25 percent of the market share for large commercial airplanes in 1990 to overtaking Boeing in 2003. Today, Airbus and Boeing roughly split the market for commercial jets.
Boeing hopes the new tariffs will reverse some of those gains. Airlines in the United States will now have to pay at least 10 percent more for Airbus jets coming from Europe, potentially steering more orders toward Boeing. And the EU may be forced to reconsider its support for Airbus, with the tariffs in place until the two sides negotiate a settlement or the WTO decides that Europe is in compliance with its rules.
“Europe is facing tariffs today because Airbus has refused for years to comply with WTO rulings,” Boeing said in a statement. “Unfortunately, Airbus’ noncompliance will negatively impact European member states, industries and businesses completely unrelated to Airbus’ actions, as well as Airbus’ airline customers.”
Airbus accepted the ruling, while calling for a settlement. Its chief executive, Guillaume Faury, said tariffs “would be a barrier against free trade and would have a negative impact on not only the US airlines but also US jobs, suppliers and air travelers.”
Airlines expressed their displeasure with the ruling last week, and the stocks of American Airlines, United Airlines and Southwest Airlines, the three domestic carriers that fly Boeing’s Max, all fell as a result of the pending tariffs.
Delta called them “an unfair tax on US consumers and companies.” JetBlue, which flies only Airbus planes, said it was “concerned about the detrimental impact aircraft tariffs will have” and argued they would “harm customers who rely on us to offer competitive, low fares.”
Other major airlines in the United States did not comment on the tariffs, preferring to avoid publicly criticizing Trump, yet were quietly fuming.
The tariff package could have been worse for Europe and its customers. The Office of the US Trade Representative said it planned to start by levying a 10 percent tariff on European aircraft and a 25 percent tariff on agricultural goods, including French wine and Spanish olive oil. Those taxes may be manageable for a time, but leave the United States room to increase pressure in the future.
But no party got everything it wanted. Boeing had hoped the tariffs would tax airplane parts from Europe, a move that would have hurt Airbus, which opened a factory in Mobile, Alabama, in 2015. In the end, the Trump administration declined to do so, believing that such a move might damage manufacturing in a pro-Trump state.
Airlines, meanwhile, had been lobbying for the tariffs to be structured in a way that minimized their pain. Last week, a bipartisan group of 34 lawmakers sent a letter urging Robert Lighthizer, the US trade representative, to avoid levying tariffs and, if he did, to exempt existing aircraft orders. But the tariffs will hit existing orders.
With more rulings from the WTO and the threat of European tariffs targeting US products looming, Boeing may not have long to savor its success. Yet in the midst of a trying year for the company, the decision was a welcome bit of good news.
“The extent to which European member states went to create and sustain Airbus for the purpose of competing with Boeing, an iconic American company, is unprecedented,” said Robert Novick, a partner at the law firm WilmerHale who represented Boeing in the case. “Indeed, the WTO established that, and the level of harm it found to Boeing is unprecedented.”
2019 The New York Times Company
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WASHINGTON -- Boeing Co said on Wednesday it would dedicate half of a $100 million fund it created after two crashes of its 737 MAX planes to provide payments to families of those killed, with veteran US compensation expert Ken Feinberg hired by the world's largest plane maker to oversee the distribution.
The announcement of Feinberg's hiring came minutes before a US House of Representatives hearing featuring dramatic testimony by Paul Njoroge, a father who lost 3 children, his wife and mother-in-law in a 737 MAX Ethiopian Air crash in March.
Feinberg told Reuters his team would "start immediately drafting a claims protocol for those eligible," with the first meeting with officials from Chicago-based Boeing later this week in Washington. Feinberg has administered many compensation funds including for victims of the Sept. 11, 2001, attacks on the United States, the 2010 Deepwater Horizon oil spill, General Motors ignition switch crashes and numerous school shootings.
The 737 MAX, Boeing's best-selling jet, was grounded globally in March following the Ethiopian Airlines crash after a similar Lion Air disaster in Indonesia in October. The 2 crashes killed 346 people.
Njoroge, 35, told reporters after he testified he did not think the public would trust Boeing going forward. "Do you want to fly in those planes? Do you want your children to fly in those planes?" Njoroge asked. "I don't have any more children."
Njoroge told a House subcommittee he still has "nightmares about how (his children) must have clung to their mother crying" during the doomed flight.
Njoroge, who was born in Kenya and lives in Canada, said Boeing has blamed "innocent pilots who had no knowledge and were given no information of the new and flawed MCAS system that could overpower pilots."
Boeing did not address specific questions raised by Njoroge but said in a statement "we truly regret the loss of lives in both of these accidents and we are deeply sorry for the impact to the families and loved ones of those on board."
A Boeing official told Reuters last month that after a new software flaw emerged the company would not submit an MCAS software upgrade and training revision until September, which means the planes will not resume flying until November at the earliest. US airlines have canceled flights through early November as a result of the 737 MAX's grounding.
Boeing shares closed up 1.9 percent Wednesday.
Acting FAA Administrator Dan Elwell told Fox Business Network on Wednesday that the agency has made a lot of progress since the plane's grounding.
"We have discovered some anomalies and then we have directed Boeing to mitigate those anomalies," Elwell said, declining to set any timetable for returning the plane to service.
"The 737 MAX is not going to fly until it passes the most thorough and intense look," said Elwell, adding that he had spent several hours with Njoroge during a recent meeting.
Boeing said on July 3 it would give $100 million over multiple years to local governments and non-profit organizations to help families and communities affected by the crashes in Indonesia and Ethiopia.
Feinberg, who will jointly administer the fund with lawyer Camille Biros, said the other $50 million in the fund was earmarked for government and community projects.
Boeing reiterated on Wednesday that the money distributed through the fund would be independent from the outcome of any lawsuits. The company is facing a slew of litigation from the families of victims of both crashes.
"Through our partnership with Feinberg and Biros, we hope affected families receive needed assistance as quickly and efficiently as possible," Boeing Chief Executive Dennis Muilenburg said in a statement.
Boeing's initial announcement of the $100 million fund was met with anger by some victims' families, who described the offer as a publicity stunt.
At the hearing in Washington, Representative Peter DeFazio, chairman of the House Transportation Committee, said he would call Boeing officials to testify at a hearing. DeFazio said the committee was in the middle of an in-depth investigation and had just received a "trove" of documents that panel investigators were reviewing.
source: news.abs-cbn.com
NAIROBI - The families of victims of an Ethiopian air disaster on Thursday criticized Boeing's plan to donate $100 million to unspecified charities and communities affected by 2 crashes, saying it was too vague and that families should have been consulted first.
Some of the families said Wednesday's announcement from the US planemaker also triggered an avalanche of unwelcome phone calls from relatives and acquaintances who believed they had just received compensation.
"This is unacceptable. They did not consult us, we only learned this morning," said Quindos Karanja, a retired Kenyan teacher whose wife, daughter and 3 grandchildren were killed in the March 10 disaster. "This is not in good faith."
The crash of the Boeing 737 MAX jet came only 5 months after the same model of plane plunged into the sea off Indonesia. The 2 disasters killed a total of 346 people, triggered the global grounding of the aircraft and wiped billions off Boeing's market value.
"It's like adding salt to a wound... They haven't consulted any families," Kenyan lawyer Kabau-Wanyoike, whose younger brother George was aboard the doomed Ethiopian Airlines flight, told Reuters. Her family has lodged a lawsuit against Boeing, and she said they wanted answers on aviation safety.
"My parents are already being disturbed by people calling to ask 'has the money come?'," she added.
Another Kenyan man, who asked not to be identified, said his family was also concerned about security in a nation where kidnappings for ransom occur frequently.
"Boeing also want to show they have a good name, but they could be putting the victims at risk," he said, adding he did not oppose Boeing supporting charities, but that it could be done more discreetly.
Boeing said the multi-year payout was not connected to the lawsuits that more than 100 families have filed against it.
It did not specify how the money would be divided, which organizations would benefit or how it might relate to victims' families.
Nomi Husain, a US lawyer representing 7 families, said his clients, including the Kabau family, had all reacted badly to the announcement.
"They are saying: 'If they want to help us, don't they know who we are? Don't they have our names?'" he said.
"They can’t change the storyline that they put profit over safety."
Asked to comment, a Boeing spokesman said: "All I can add to our release is that the pledge is absolutely independent of the lawsuits filed. This step will support education, hardship and living expenses for affected families, community programs, and economic development in those communities."
source: news.abs-cbn.com
NEW YORK - Boeing acknowledged Saturday it had to correct flaws in its 737 MAX flight simulator software used to train pilots, after two deadly crashes involving the aircraft that killed 346 people.
"Boeing has made corrections to the 737 MAX simulator software and has provided additional information to device operators to ensure that the simulator experience is representative across different flight conditions," it said in a statement.
The company did not indicate when it first became aware of the problem, and whether it informed regulators.
Its statement marked the first time Boeing acknowledged there was a design flaw in software linked to the 737 MAX, whose MCAS anti-stall software has been blamed in large part for the Ethiopian Airlines tragedy.
According to Boeing, the flight simulator software was incapable of reproducing certain flight conditions similar to those at the time of the Ethiopian Airlines crash in March or the Lion Air crash in October.
The company said the latest "changes will improve the simulation of force loads on the manual trim wheel," a rarely used manual wheel to control the plane's angle.
"Boeing is working closely with the device manufacturers and regulators on these changes and improvements, and to ensure that customer training is not disrupted," it added.
Southwest Airlines, a major 737 MAX customer with 34 of the aircraft in its fleet, told AFP it expected to receive the first simulator "late this year."
American Airlines, which has 24 of the aircraft, said it had ordered a 737 MAX simulator that will be delivered and put into operation in December.
"As a result of the continuing investigation into both aircraft accidents, we are looking at the potential for additional training opportunities in coordination with the FAA (Federal Aviation Administration) and Allied Pilots Association," it added.
- Certification process -
The planes have been grounded around the world, awaiting approval from US and international regulators before they can return to service.
Only Air Canada has a MAX simulator, industry sources told AFP.
Currently, there is only one flight simulator specific to the 737 MAX in the United States, and it is owned by Boeing, according to FAA documentation.
US airlines train their pilots flying the MAX on a simulator built for the 737 NG, the version preceding the 737 MAX in the 737 aircraft family.
Southwest said that's because during the certification process for the MAX, Boeing stressed that there were only minor differences with the NG and simple computer and online training could accommodate for the differences.
The FAA, the European Union Aviation Safety Agency and Canadian regulators had approved those recommendations, Boeing stresses.
However, the 737 NG lacks an MCAS, specially designed for the MAX in order to correct an aerodynamic anomaly due to its heavier motor and to prevent the plane from stalling.
Pilot training will likely be at the heart of the meeting of international regulators in Forth Worth, Texas on Thursday when the FAA will try convince its counterparts of the robustness of its certification process for the modified 737 MAX.
The American regulator has maintained that training pilots on a simulator is not essential, a position with which pilots and its Canadian counterpart disagree.
Boeing said Thursday that it completed its software update on the 737 MAX.
The proposed fix, which addresses a problem with a flight handling system thought to be a factor in both crashes, must now win approval from US and international regulators before the planes can return to service.
US airlines have targeted August as the date they expect to resume flying on the 737 MAX.
source: news.abs-cbn.com
MIAMI -- Dozens of shocked passengers were evacuated to safety from the wings of a stricken Boeing 737 on Saturday in Florida after the jet made a rough landing in a lightning storm and skidded off the runway into a river.
The plane carrying 143 people including crew from Guantanamo Bay in Cuba slammed into shallow water next to a naval air station in Jacksonville after a hard landing that saw the plane bounce and swerve down the runway, passengers said.
No fatalities or critical injuries were reported.
"As we went down... the plane bounced and screeched and bounced more and lifted to the right and then it lifted to the left," Cheryl Bormann, a defense attorney who was on board the flight, told CNN.
"And then it sort of swerved and then it came to a complete crash stop."
Some oxygen masks deployed and overhead lockers flew open during the landing, she added.
Twenty-one adults were taken to local hospitals, but none were critically injured, the Jacksonville sheriff's office said on Twitter. Others were treated for minor injuries at the scene.
Captain Michael Connor, commanding officer at Naval Air Station Jacksonville, told reporters it was a "miracle" no more serious injuries or fatalities had occurred.
"We could be talking about a different story this evening, so I think there's a lot to say about, you know, the professionalism of the folks that helped the passengers off the airplane... it very well could be worse," he said.
All 136 passengers and seven aircrew on board had been accounted for, NAS Jacksonville said in a statement.
However, there were fears for a number of pet animals traveling in the plane's luggage compartment.
The pets had "not been retrieved yet due to safety issues with the aircraft," NAS Jacksonville said in an update on Facebook.
The National Transportation Safety Board said a 16-member team had arrived on site to investigate the incident, and would brief the media later in the day.
Boeing said it was aware of the incident was and providing technical assistance to the agency as it conducts its probe.
'LIGHTNING AND THUNDER'
Images showed the Miami Air International plane lying partially submerged in water after the rough landing, with its nose cone missing.
Passengers in life vests were instructed to clamber onto the wings of the jet before being transported to shore aboard inflatable life rafts, Bormann said.
"We couldn't tell where we were, a river or an ocean. There was rain coming down. There was lightning and thunder. We stood on that wing for a significant period of time," she told CNN.
Navy security and emergency response personnel including some 90 firefighters were on the scene.
Jacksonville Mayor Lenny Curry tweeted that the White House had called to offer assistance as the situation was developing.
"All alive and accounted for. Our Fire and Rescue teams are family to all," said Curry.
Teams were working to control jet fuel spilling into the St Johns River, he added.
The "Rotator" flight from the US military base in Cuba carries passengers including military personnel and family members.
The plane involved was a Boeing 737-800, in operation for 18 years, according to the FlightRadar24 website.
US aerospace giant Boeing is under scrutiny following 2 crashes that killed a total of 346 passengers and crew and grounded its newer 737 MAX planes worldwide.
Both a Lion Air crash in Indonesia in October and March's Ethiopian Airlines crash outside Addis Ababa occurred shortly after takeoff.
source: news.abs-cbn.com
CHICAGO, United States - Boeing co-chief executive Dennis Muilenburg will face shareholders on Monday for the first time since 2 fatal crashes that led to the 737 MAX's grounding worldwide and triggered investigations, lawsuits and a sharp loss in share value.
Battling the biggest crisis of his tenure, Muilenburg will try to bolster investor confidence in the manufacturer's future as well as that of its fastest-selling airplane as questions linger over the model's safety.
Family and friends of 24-year-old American Samya Stumo, one of the victims of the crash of an Ethiopian Airlines 737 MAX on March 10, will hold a silent protest outside the meeting site.
That crash, which killed all 157 on board when it plunged to the ground shortly after takeoff, came five months after a similar Lion Air nose-dive that killed all 189 passengers and crew.
Muilenburg will hold his first press conference since the grounding after the general annual shareholder meeting in Chicago, scheduled for (10 p.m. in Manila).
Boeing is under pressure to deliver a software fix and a new pilot training package that will convince global regulators, and the flying public, that the aircraft is safe to fly again.
The US Federal Aviation Administration could clear Boeing the 737 MAX jet to fly in late May or the first part of June, 2 people familiar with the matter said on Friday, though Boeing has yet to submit the updated software and training for review.
Some pilots have warned that draft training proposals do not go far enough to address their concerns.
Meanwhile, deliveries of the 737 MAX, which airlines around the world had been relying on to service a growing air travel industry for years to come, are on hold.
Last week Boeing abandoned its 2019 financial outlook, halted share buybacks and said lowered production due to the 737 MAX grounding had cost it at least $1 billion so far.
Shareholders have filed a lawsuit accusing the company of defrauding them by concealing safety deficiencies in the plane. The model is also the target of investigations by US transportation authorities and the Department of Justice.
Muilenburg is Boeing's chairman and president in addition to CEO, and faces calls that could strip him of one of those titles at Monday's meeting. Boeing has recommended against the move.
Boeing must also contend with lawsuits filed on behalf of dozens of victims of the 2 crashes, including the family of Stumo, who are asking whether the Ethiopian disaster could have been prevented after what happened to Lion Air.
"Those in charge of creating and selling this plane did not treat Samya as they would their own daughters," her mother Nadia Milleron told reporters in early April.
Shares in the company, worth $214 billion, have lost nearly 10 percent of their value since the March 10 crash.
source: news.abs-cbn.com
NEW YORK -- Boeing faces a wave of flight cancellations by US airlines and pressure from President Donald Trump to rebrand its top-selling 737 MAX aircraft, a month after the plane was grounded worldwide in the wake of two deadly crashes.
American and Southwest Airlines say the grounding will disrupt scheduled flights through the summer, during the peak travel season which helps generate corporate profits.
American is canceling all 737 MAX flights through August 19 while Southwest, which owns the largest 737 MAX fleet, with 34 planes, is canceling them until Aug. 5.
United Airlines said it had previously used spare aircraft and "creative solutions" to keep from having to cancel flights but cancellations in the busy summer travel season could no longer be avoided.
"No one knows when the FAA review will be complete, so we've decided to pull MAX flights out of our schedule through early July," a spokesperson told AFP on Monday.
In all, an average of 275 flights a day will be canceled, which are likely to put a dent in airline profits and could cause the companies to raise airfares.
American already cut a key industry revenue metric -- Total Revenue per Available Seat-Mile, or TRASM -- saying it will rise one percent in 2019, down from a prior estimate of two percent.
Southwest is allowing affected passengers to reschedule flights at no additional cost.
"Neither Airbus nor Boeing like cancellations and there are stiff contracts which make this very difficult," said Scott Hamilton, managing editor of the aviation news site Leeham News and Analysis.
"The companies will swap airplane types, however, if it comes to this."
All 737 MAX aircraft have been banned from the world's skies since mid-March after suffering two fatal crashes less than five months apart: a Lion Air flight crashed in the Java Sea in October, leaving 189 dead, and the Ethiopian Airlines crash on March 10, which killed 157 people.
Crash investigators have zeroed in on the planes' anti-stall system, the Maneuvering Characteristics Augmentation System, or MCAS.
And Boeing, which has already ceased 737 MAX deliveries and slowed the pace of production, a buildup of delays could increase the penalties it must pay client airlines, Hamilton said.
Trump tweeted early Monday that Boeing had to give its scandal-stricken aircraft a new image.
REBUILDING TRUST
"What do I know about branding, maybe nothing (but I did become President!), but if I were Boeing, I would FIX the Boeing 737 MAX, add some additional great features, & REBRAND the plane with a new name," he said.
But Hamilton said Trump was right to doubt his own expertise.
"Trump is a boob. Boeing isn't going to rebrand the 737," Hamilton said, pointing to Boeing's log of more than 4,600 backorders, a key sales revenue driver, and adding that the order cancellations so far were "inconsequential."
Aviation analyst Richard Aboulafia of Teal Group agreed.
"Pretty much all of President Trump's pronouncements on aviation are safely and best ignored," he said.
Boeing is finalizing software upgrades for the MCAS, which it has pledged to submit to regulators in the coming weeks so that the 737 MAX grounding order can be lifted.
"We're focused on testing and implementing the software update and rebuilding the trust of our airline customers, pilots and the traveling public," a spokesperson told AFP.
"We know we have a deep responsibility to everyone who flies on our airplanes to ensure that the MAX is one of the safest aircraft ever to fly."
Rebranding the aircraft would impose additional costs on the airlines which would be required to fully retrain pilots, while an updated model involves less intense additional training.
Flight cancellations show the airlines, that had hoped to have the planes back in the air by May, now expect it will be longer before the aircraft can return to service.
Aviation analysts largely agree and expect the grounding to be lifted by the end of August.
In the meantime, the industry is working to regain the trust of the flying public.
The US Federal Aviation Administration, which must certify the 737 MAX's airworthiness, released a video last week in which its interim chief Daniel Elwell said the agency was working to keep pilots informed.
The FAA also said the agency would not rush to get the 737 MAX flying again.
source: news.abs-cbn.com
