Boeing Brand Check-up: A Safety Promise With Missing Bolts
On January 5, 2024, a door plug blew out of an Alaska Airlines 737-9 MAX shortly after takeoff from Portland. No one was seriously injured. For a company still living with two 737 MAX crashes that killed 346 people, the damage landed on the brand. By April 9, Boeing had a regulator capping its output, a departing CEO and a share price down about 32% this year.
Key takeaways
- Boeing sells safety to airlines and, through them, to passengers, so a quality failure on the factory floor is a brand failure.
- Trust fell fast: Morning Consult measured Boeing’s net trust among U.S. adults at 9 points in February 2024, down 16 points since December.
- The FAA refused any expansion of 737 MAX production, and first-quarter deliveries fell to 83 commercial aircraft from 130 a year earlier.
- A change of chief executive has been announced, but trust will return only with visible proof of better quality, not with new faces alone.
Download the full Boeing Brand Check-up (PDF): vital signs, timeline, diagnosis, treatment and sources.
Two crises on one aircraft family
The 737 MAX already carried a heavy history. Lion Air Flight 610 crashed in October 2018 and Ethiopian Airlines Flight 302 in March 2019, killing 346 people. The jet was grounded for 20 months. In January 2021 Boeing agreed to pay over $2.5 billion under a deferred prosecution agreement. The Justice Department said Boeing, through two of its 737 MAX technical pilots, had deceived the FAA about the MCAS flight-control system.
No one died on Flight 1282, but it raised the same question: can Boeing build the aircraft right? The day after, the FAA grounded about 171 737-9 MAX aircraft. The National Transportation Safety Board’s preliminary report said four bolts that stop the door plug moving upward were missing. Chief executive Dave Calhoun said: “Whatever final conclusions are reached, Boeing is accountable for what happened.”
Symptoms: the market, the public and the regulator
Boeing closed at $249.00 on January 5 and at $229.00 on January 8, the first trading day after the grounding, a fall of 8%. On April 9 it closed at $178.12, down about 32% from the 2023 year-end close of $260.66 and about 60% below its close of $440.62 on March 1, 2019, nine days before the Ethiopian crash.
Trust fell before the financial results could show it. Morning Consult found Boeing’s net trust among U.S. adults stood at 9 points in February, down 16 points since December. Kayak reported a 15-fold increase in use of its aircraft filter, which travellers were using to screen out 737 MAX flights. When passengers try to avoid a product by name, the brand is working against the business.
The regulator also reached into production. FAA Administrator Mike Whitaker said: “This won’t be back to business as usual for Boeing.” The FAA refused any expansion of 737 MAX production until quality problems were resolved, and on February 28 gave Boeing 90 days to produce an action plan. First-quarter deliveries fell to 83 commercial aircraft, from 130 a year earlier.
Diagnosis: a promise made on the factory floor
Boeing’s brand rests on one promise: the aircraft is built right. That promise is kept or broken in the factory, not in advertising. An FAA audit of the 737 MAX production line found Boeing failed 33 of 89 product audits, the New York Times reported, and its fuselage supplier Spirit AeroSystems failed seven of 13. The FAA cited non-compliance in manufacturing process control, parts handling and storage, and product control. In our view, output had outrun quality.
Repetition is the second cause. One failure can be read as bad luck. A second on the same aircraft family within five years reads as a pattern, and customers remember patterns.
The third cause is distance. On March 1 Boeing confirmed preliminary talks about making Spirit AeroSystems “a part of Boeing again.” Seeking to bring a supplier back in-house suggests that control of quality had drifted too far from the company whose name is on the aircraft.
The fourth is leadership. On March 25 Boeing said Calhoun would step down at the end of 2024, board chair Larry Kellner would not stand for re-election and Commercial Airplanes head Stan Deal would retire. New faces help only when they come with new evidence.
Treatment: proof before promotion
The most useful sentence came from chief financial officer Brian West in March: “We are deliberately going to slow to get this right.” That is the treatment. We would add three things: publish the FAA action plan in plain language, report quality measures each quarter next to deliveries, and judge the next chief executive by those measures. A marketing audit usually starts with messaging. Boeing’s should start with the gap between what the brand promises and what the factory ships.
What growing companies can learn
Your brand is the promise your operations keep. When growth targets push quality aside, the bill arrives as lost trust, and it costs more than the growth was worth. Measure trust directly; demand signals such as branded search can flatter you. When you apologize, show the fix. A second apology for the same failure buys far less than the first.
This check-up uses public information available on April 9, 2024. It is brand and marketing analysis, not investment advice.
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